“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