The eSourcing Managed Service in the UK (eMS in UK)

UK Public sector procurement professionals are targeted to achieve one third of the Government’s target of £21.5 billion of efficiency gains a year by 2007/8. Responding to these targets, OGCbuying.solutions (the procurement arm of HM Treasury) was tasked with implementing an eSourcing managed service that was efficient, secure, transparent and operates in accordance with procurement best practice. The service supports procurement professionals by offering tools that: - improve efficiency by reducing tender cycle times - reduce sourcing costs by eliminating the need for paper, print and distribution - improve the quality of sourcing decisions - comply with EU Procurement Directives

Policy Context

The OGCbuying.solutions eSourcing managed service was implemented in response to the i2010 eGovernment action plan and to support this plan to make Europe the most dynamic and competitive, knowledge-based economy by 2010. The service is committed to meeting i2010’s target of 50% of public procurement above the EU public procurement threshold to be carried out electronically. The project operates under UK and EU procurement legislation.

Description of target users and groups

The eSourcing managed service supports the business transactions between UK public sector procurement professionals and all private sector suppliers to government. There are currently 1,500 buyer end-users trained and actively using the service from the following sectors: - Central Civil Government - Devolved Government - Public corporations - Education - Local Government - Emergency - Health Sector Some of the organisations currently using the service are: - British Broadcasting Corporation (BBC) - Crown Prosecution Service - Department for Communities and Local Government - Department for Constitutional Affairs - Department for Transport - Department for Work & Pensions - East of England Regional Development Agency - Kings College London - Glasgow City Council (Scottish devolved parliament) - Her Majesty’s Prison Service - National Health Service Purchasing and Supply Agency - Metropolitan Police - Office of Government Commerce - Olympic Delivery Authority - The Home Office - Transport for London - Welsh Assembly Government - West Midlands Regional Centre of Excellence Responding to online tenders created by these buyers are the private sector supplier communities. 30,000 supplier organisations participated in electronic tenders worth over £15 billion in contract value. These include suppliers from the following sectors: - SME’s - Large corporations - Sole traders - Voluntary and community sector - Not for profit organisations Business sectors currently supplying the UK Government via the eSourcing managed service include: - Construction - Digital Content - Electronics and IT Services - Environmental Industries - Information Security - Manufacturing - Materials and Engineering - Service based industry - Publishing - Retail - Telecommunications The service enables any supplier, based anywhere in the world, the opportunity of winning a supply contract with the UK Government.

Description of the way to implement the initiative

The service is fully managed by a team of skilled procurement professionals within OGCbuying.solutions. The team offer change management support to ensure effective adoption throughout government organisations subscribed to the service. http://www.ogcbuyingsolutions.gov.uk/esourcing/esourcing.asp The technology provider BravoSolution is responsible for setup, configuration, system administration, maintenance, security, data backup, disaster recover and software upgrades and hosting of each customised eSourcing portal. BravoSolution also provide a helpdesk to address queries and requests for support from buyers and suppliers. www.bravosolution.co.uk Each customer is encouraged to continually feedback their experiences of the solution via an online eSourcing support portal and regular service development workshops conducted by OGCbuying.solutions. Multi-channel issues: The service is delivered solely via an online and customer specific eSourcing portal that is designed to fully represent each individual organisation’s own unique branding and is used as a single point of reference for buyers and suppliers to engage in contracting activities (see https://bbc.bravosolution.com ) Implementation of the platform for each customer requires no internal IT investment or IT maintenance. Organisations are able to go-live with their customised eSourcing portals within 3 weeks from project initiation. The OGCbuying.solutions eSourcing Managed Service is delivered in partnership with BravoSolution, Europe’s leading provider of eSourcing solutions. Organisations joining the service are offered: - Setup, configuration and hosting of a customised eSourcing portal - System administration, maintenance, security, data backup, disaster recover and software upgrades - Helpdesk to address queries and requests for support from buyers and suppliers - Training and change management support to ensure effective adoption

Main results, benefits and impacts

SOME HEADLINE STATISTICS - £15 billion worth contracts awarded electronically - 120,000 tender response documents submitted online (22 million pages if printed saving 2,300 trees) - £1 million reduction in overhead costs (printing, copying, postage, stationery and storage). - £300 million saved on the cost of goods and services sourced through the use of electronic reverse Auctions - £10 million in process efficiencies through elimination of the labour intensive administrative tasks (a detailed study by the Home Office Commercial Directorate concluded that average 25%-30% reduction in staff effort through online tools) - TANGIBLE AND INTANGIBLE BENEFITS Process efficiencies - eSourcing solutions automate or eliminate some of the labour intensive and repetitive administrative tasks and frees up time for existing staff to focus on more strategic activities. Improved negotiations - Included with the eSourcing toolkit is a full suite of reverse auction functionality. OGCbuying.solutions have recorded an average saving of 23% across a number of diverse categories. Reduced EU Procurement Timescale - The Consolidated Procurement Directive (Legislation in the UK from Jan 31st 2006) allows for the reduction of the EU timescales when conducted via eSourcing/eTendering solutions. Reduction in overhead costs: printing, copying, paper, postage, carriage and stationery costs are reduced or removed when using an eTendering system. Knowledge management & collaboration - Having one system shared across all buyers and evaluators within the authority ensures that decentralised procurement staff can operate within the authority’s policies and procedures. Suppliers can also benefit from having the full history of their responses online and accessible at any time in the future. Response evaluation - eSourcing solutions provides comparable data in spreadsheet format and supports the creation, distribution and collation of evaluator scorecards, and evaluation reports. Increased transparency - eSourcing solutions provide a secure history of each tender from advert and tender creation to contract award. This audit trail encourages openness and integrity in all contractual decisions. Reduced potential for disputes - In cases where eSourcing is implemented any complaints from bidders may be addressed rapidly and with highly robust audit information from the eSourcing toolkit. Improved communication - Through the service, suppliers are able to see contract renewal dates, tender deadlines, status and the rationale for the eventual award of the contract. The site can be accessed 24 hours a day, 7 days a week. Flexibility and efficiency - Suppliers can download and submit electronic tender documents using the time that would have otherwise been spent on print and postal delivery to complete the response. Improved access to opportunities - As eSourcing solutions are Internet-based, suppliers can easily view and engage in tendering opportunities without being constrained by location. No client technology investment required: the hosted managed service means that the customers can be trained and provide access their portal via the internet in just six weeks from subscribing to the service Innovation: Public sector contracting carries burdensome administrative overhead with buyers and suppliers involved in an intense paper-based exchange throughout the tendering lifecycle which begins with calls for tender and ends with awarding of a contract. Each year tens of thousands of buyers and suppliers engage in this costly, inefficient and inherently primitive set of activities for the award of over £100 billion of public sector contracts. The objectives of the eSourcing Managed Service is to modernise public sector contracting through innovative web-based technologies which enable buyers and suppliers to securely manage their interactions online. The eSourcing managed service has delivered exceptional results for the UK public sector after basing the solution on the ‘Software as a service’ IT model. A single remotely hosted multi-tenant architecture was setup to be jointly used by all UK public sector organisations. A highly innovative approach was adopted offering the benefits of a shared hardware/software infrastructure while allowing each public sector organisation to customise aspects of the solution to its own specific needs. This was achieved by embedding mass-parameterisation in the software architecture enabling: - full configuration of each customer’s user interface (to address specific branding and terminology preferences) - distinct setup of over 100 elements of functionality to address differences in each customer’s internal workflows or procedures This pan-government shared IT solution effectively guarantees: - efficiencies through use of single shared IT infrastructure and unified security, maintenance, data backup and disaster recovery - “on-demand” availability over the Internet requiring no hardware/software installation by public sector organizations The 2006 National Audit Office report on “Delivering Successful IT-enabled Business Change” cited the project among 20 UK and global, public and private sector success case studies and praised for its effectiveness in modernising UK government procurement and in delivering substantial savings to the UK taxpayer.

Return on investment

Return on investment: Not applicable / Not available

Track record of sharing

The eSourcing managed service is offered to UK central and local government organisations through a framework agreement and managed by a skilled team of procurement professionals within OGCbuying.solutions who promote and support adoption amongst UK public sector. The service is available in 14 languages and fully complies with European procurement directives.

Lessons learnt

1) Successful implementation of the solution can only be achieved by fully supporting the change management process within the public sector organisation 2) A fully effective service can only be developed, maintained and updated with the help of extensive customer feedback, support and service improvement suggestions. 3) It is important to capture the benefits of the service as a common methodology across all users and to share best practices in implementation

Scope: National