cooperative purchasing | The Contracting Education Academy

November 13, 2018 By AMK

PA bill would open door to competitive school construction bids, away from cooperative purchasing

Pennsylvania state representative Jesse Topper has introduced a bill that would open major construction projects to competitive bidding, reports The Inquirer of Philadelphia.

The bill, which is with the State Government Committee, was precipitated by a study from research firm Ducker Worldwide that found from 2005 to 2010, schools across the state wasted more than $100 million in taxpayer money on roofing by using cooperative purchasing rather than competitive bidding.

The proposed bill would outlaw cooperative purchases for construction projects, which the bill’s backers say will save money, especially for public schools having financial troubles. One school district received a roofing bid from a cooperative for $2.4 million, whereas an open bid for the same project totaled $1.4 million.

Still, many Pennsylvania school officials say cooperative purchasing agreements have merit, offering quality assurance, consistency and reduced maintenance, reported The Inquirer. They also say that open bids, unlike cooperatives, don’t take design costs or project monitoring into account.

Keep reading this article at: https://www.constructiondive.com/news/pennsylvania-bill-would-open-door-to-competitive-school-construction-bids/541536/

June 26, 2017 By AMK

Report shows procurement staffs overworked, impacting competition

“With a noticeable decline in performance since the last survey, state and local government procurement is facing some difficult challenges that may result in unwanted consequences for both buyers and sellers.”

That’s a conclusion drawn from a survey conducted by government business intelligence company Onvia, in a report released last week.

The report shows a 5% decline in performance on the part of procurement officials working for state, local and educational (SLED) institutions of government. And the decline in performance is occurring in spite of 40% of the survey respondents stating that they are working longer hours than ever.

In the report SLED buyers complain that they:

Do not have adequate time to conduct market research and prepare adequate bid invitations and requests for proposals.
Lack staffing resources in the procurement function, and
Face challenges working with end-users and stakeholders.

To better understand the government contracting environment, Onvia surveyed 668 procurement professionals and key decision-makers from state, county and city agencies, plus school and special districts nationwide. 59% of the survey respondents said they operate in a decentralized acquisition environment.

Another report – conducted by IHS Global Insight – documents a 3.4% increase in state and local agency current spending levels. That’s consistent with what 39% of procurement staff surveyed by Onvia said. They predict 4% growth in bid volume in the next 12 months. There’s little doubt this is linked to the recent surge in demand for infrastructure bids stemming from the $200 billion in tax initiatives for these projects approved by voters nationwide last November.

In addition to 24.8% of the respondents saying that they are challenged by conducting pre-bid research and planning, SLED procurement personnel say their top challenges are:

Meeting regulatory, contracting guidelines and rules (18.1%),
Dealing with workload and staffing limitations (17.8%), and
Working with stakeholders and end-users (15.8%).

Given these conditions, it’s no surprise that the next top-ranked challenge faced by buyers (14.9%) is “getting enough participation from vendors.” Four out of ten agency respondents indicate that they are failing to attract enough interest among vendors and contractors to their competitive solicitations. The frustration and inefficiencies within agencies, the report notes, “have negative impacts on the experience of bidders as they compete for work and interact with those involved in the purchase decision.”

The report also documents an 8% decline in the agility of purchasing organizations in the last 12 months. Agility is measured in terms of factors such as wait times for processing bids and making award decisions.

In addition, only 69% of agency staff rate themselves as high or above average in friendly, responsive customer service – down 9% from last year.

Perhaps most troubling, over the last year there was a 6% decline in the percentage of procurement staff reporting above-average or high levels of integrity and transparency (83% down to 77%).

Among the conclusions and observations offered by Onvia are:

“Attracting attention from bidders is not simply a function of agency and contract size. [There is] a strong case for investing in the procurement function itself within an agency, with the goal of providing the most effective buying services.
“Government that provides a more fair, consistent, timely and smooth buying process can attract attention from established bidders that have options on where to focus their marketing efforts and may not have time to bid on every deal.”

The report also contains information about the use of purchasing co-ops and the use of e-procurement systems. To download a copy of the full report, free of charge, visit: https://www.onvia.com/market-research/surveys/survey-government-procurement-professionals-2017

March 17, 2011 By AMK

Corporate leaders advise government on personnel, contracting issues

President Obama’s Management Advisory Board, an independent panel of corporate leaders, suggested on Friday that the government must do more to incentivize its leadership and improve its operational management.

At its first meeting, the new board that was established to provide the White House with strategic advice on government management and operations, heard from administration officials on a range of topics, including the salaries of senior executives and the consolidated procurement efforts of federal agencies. Presentations also were delivered on information technology and federal customer service initiatives — each of which the group will tackle.

For example, John Berry, director of the Office of Personnel Management, explained how the difficulties of attracting — and then retaining — the best and brightest to work in the government instead of taking more lucrative private sector positions are exacerbated by charges that federal employees are overpaid.

Berry said the board could help dispel this notion because of its credibility in the business world. “When you carry that mission, it carries some weight,” he said.

The panel likely will focus on ways to better train and develop senior government leadership, recruit candidates from outside of government, improve the federal performance management system and reward high-performing employees.

There are limits to what the group can address, however. The administration does not have much flexibility in its compensation scale for its Senior Executive Service, with salaries generally ranging from $120,000 to $180,000, said W. Scott Gould, deputy secretary of the Veterans Affairs Department.

Removing poor-performing senior executives is on the table, but Gould, who has eliminated 20 such positions at VA in the past two years, suggested reform will not be easy. “It’s hard to do and takes a long time to go through the process,” he said.

The board also heard about the government’s efforts to improve its strategic sourcing of common commodities. The General Services Administration, which has developed blanket purchasing agreements that all agencies can use for the procurement of office supplies, plans to expand the practice in the future.

“Budget pressures are forcing agencies into these cooperative purchases,” GSA Administrator Martha Johnson said.

Dan Gordon, administrator of the Office of Federal Procurement Policy, said the government “struggles mightily” to define its acquisition requirements and is too dependent on contractors for core services. “We use contractors to write contracts for other contractors,” Gordon said.

Obama established the advisory board last April through an executive order to provide advice on how to implement best business practices on issues such as productivity, the application of technology and customer service.

The order called for the board, which is chaired by Jeffrey Zients, deputy director of management for the Office of Management and Budget, to include no more than 17 leaders from the private sector. On Thursday, Obama appointed 10 members to the board. An OMB spokeswoman said it’s possible that more board members will be named.

The board members are Greg Brown, president and chief executive officer of Motorola Solutions Inc.; Sam Gilliland, chairman and CEO of Sabre Holdings, a travel technology company; Jeffrey Kindler, former chairman and CEO of Pfizer Inc.; Debra Lee, chairwoman and CEO of BET Networks; Gail McGovern, president and CEO of the American Red Cross; Shantanu Narayen, president and CEO of Adobe Systems Inc.; Enrique Salem, president and CEO of Symantec Corp.; Elizabeth Smith, CEO of OSI Restaurant Partners LLC; Tim Solso, chairman and CEO of Cummins Inc.; and Ronald Williams, chairman of Aetna Inc.

The board, which is purely advisory, will operate for two years, unless the White House extends it.

– by Robert Brodsky – GovExec.com – March 11, 2011

Pennsylvania state representative Jesse Topper has introduced a bill that would open major construction projects to competitive bidding, reports The Inquirer of Philadelphia.

“With a noticeable decline in performance since the last survey, state and local government procurement is facing some difficult challenges that may result in unwanted consequences for both buyers and sellers.”

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