Electronic Markeplace for Italian Public Sector

Published on: 28/02/2008
Document
The PA Electronic Market (MEPA) is a public eProcurement tool managed by Consip on behalf of the Italian Ministry of Economy and Finance (MEF). It is a dynamic tool in which products and services are presented in structured catalogues and described according to standard formats. The purchasers are registered Authorities that may implement purchases directly through orders from the catalogues, or by requesting preliminary offers. An identical product/service may be sold by various suppliers at different conditions (as in the real market) and there is no pre-negotiation on the part of Consip. MEPA is part of the wider Program for the Rationalization of Public Spending on Goods and Services that was launched in 2000 by the MEF in the wake of the introduction of a new model for the optimization of public provisioning in Italy. As is common with many innovative and relatively new projects, apart from the benefits it provides, MEPA also has some critical elements that slow its dissemination. Specifically, these have been highlighted as a) from the demand side, the problem of digital divide and the inertia of users from the point of view or organizational and cultural change management, and b) from the supply side, a reluctance, especially at the local level, to join the game and play by rules that are more competitive, with the risk of losing some traditional “market niches”, as well as the aversion to investing in eCommerce without a clear vision of its long-term returns. Among the advantages provided by the MEPA one should highlight process savings in terms of man/hours compared to traditional contracting methods and the possibility of a detailed and constant monitoring of public expenditure.

Policy Context

MEPA has been implemented according to a national decree in 2002 (DPR 101/2002) ruling electronic procurement in the Public Sector, limiting the use of MEPA to purchases below the EU threshold. In compliance with Italian Budget Law for 2007, the adoption of MEPA has become compulsory for Central Administrations, while all other Administrations are allowed to use it. With a particular regard to digital tools, MEPA is fully compliant with the EU Directive 18/2004 CE.

Description of target users and groups

1) All public officials and Authorities, previously registered to the Italian Public Procurement Portal (www.acquistinretepa.it), are entitled to access to a web-based marketplace, where they can search, analyze, compare and buy (below the European thesholds) goods and services. The service is mandatory for Central Administrations. 2) Compliant to minimal requirements, registred suppliers can submit their offers, described through a defined set of attributes in a form of an e-catalogue. In 2007 about 6.000 Public officials and more than 1.200 suppliers (80% SME) have used the service with more than 28.000 e-orders, choosing among more than 350.000 items.

Description of the way to implement the initiative

MEPA is now an effective and fully operating virtual market in which any P.A. can select goods and services offered by several suppliers, for purchases below EU threshold The entire process is digital, using digital signature in order to ensure legal compliance and overall trasparency of process. Public users may buy in 2 different ways: - making a direct purchase selecting goods and services from the catalogue; - negotiating the product quality, price and service levels with qualified suppliers (Request for Quotation), handling on-line the entire purchasing process and digitally signing the order; An exstensive training program is developed to support Public Officials and Suppliers. In particular, in partnership with Entrepreneurs Associations more than 120 "training" desks have been set up to support SME all over Italy to join and partecipate in the MEPA

Technology solution

The approach consists in outsourcing the SW development and infrastructure management. Core activities such as requirement definition are fully defined internally by Consip. The platform is a market-based product, with several customizations in order to make it compliant with Italian Accessability Laws and the European Directive regarding public procurement. Technology choice: Proprietary technology, Standards-based technology, Accessibility-compliant (minimum WAI AA)

Main results, benefits and impacts

The advantages brought by the use of the MEPA include not only cost and time savings in the provisioning cycle, but also processes and organization optimization. Many Officials that have used the MEPA confirm the existence of an economic advantage in terms of price reduction, as well as process savings. The full deployment and final assessment on the benefits requires a medium-long term. Nevertheless, the first years of MEPA adoption have clearly shown significant benefits in terms of transparency, change management and process savings not only for Public Administrations, but also for the enterprises participating in the program. Undoubtedly, the supplier participations in the MEPA amounts to: - the activation of a new channel of commercial relations with the PA; - participation free of charge; - nation-wide visibility of their offers; - greater penetration in their local territory, without requiring further commercial investments. A particular issue is related to the great transparency in tender procedures, a spontaneous self-regulation of the bids based on ecatalogues, since “all see and compare themselves to all”, making for a greater fairness in competition. Another benefit is given by the lower marketing and sales costs, deriving from wider visibility in the entire public market. Significant results in 2007: - 84 million euros of transacted volume - Over 332,000 offered goods - 28,173 transactions, meaning contracts processed through the system. - 2,750 active Ordering Points, meaning public buyers that have used the tool. - 1.156 enterprises registered with the MEPA. - 1,809 catalogues published. - 90% of registered suppliers are small or medium-sized enterprises.

Return on investment

Return on investment: Not applicable / Not available

Track record of sharing

This case has been presented in several international events and workshop in order to show the lesson learned and the successful experience of implementig such a complex system in terms of organization, technology, legal framework and marketing skills.

Lessons learnt

- Eprocurement is not only a techological issue, but is based on a deep cultural and process change. - Due to the significant required efforts, a large (almost national) scale economy is a key success factor. - A continous and large involvement of public administrations and suppliers is necessary, by means of training, comunication and support, to reach the widest consensus. Scope: Local (city or municipality), National, Regional (sub-national)