National Procurement Assistance and Development (NPAD)

Published on: 03/02/2010
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The National Procurement Assistance and Development is a newly established initiative by the Swedish Government, entrusted with the task of promoting and developing electronic procurement for the public sector in Sweden.

The development of Swedish pre award electronic procurement has previously been largely attributed to private sector procurement platform/system suppliers and individual initiatives by public authorities or groups of such. This renders the Swedish case interesting from many perspectives, as a national initiative is introduced in the playing field to try to coordinate and guide the development in a certain direction. Questions such as how to balance the development in terms of interference with the free market and how to accomplish a seamless public procurement process with a free and unbroken flow of information between different platforms and systems are just examples of what needs to be answered in the years ahead.

This case will thus not revolve around a specific technical national procurement platform, but rather give an insight into the political, technical and market specific circumstances we are facing, our analysis and reflections so far and our first steps in terms of actual action in some direction.

Policy Context

The initiative falls within the scope of the strategic framework laid down in the EU eGovernment Action Plan for eProcurement and the ambition to reach the set  goals of 100% eProcurement capability and 50% of all procurement above the EC threshold carried out electronically by 2010.

On a national level, the initiative is part of the Swedish Government's National Action Plan for eGovernment presented in 2008. The action plan splits the implementation of electronic public procurement into three steps.

  1. The first step involves the introduction of electronic invoicing for the Swedish public sector. The introduction of eInvoicing was coordinated by the Swedish National Financial Management Authority and electronic handling of all ingoing and outgoing invoices by public authorities under the state was made mandatory as of the 1st of July 2008.
  2. The second step involves the introduction of electronic ordering for the Swedish public sector. This step is also lead and coordinated by the Swedish National Financial Management Authority and was launched in 2008. The introduction of eOrdering for public authorities is to be finished by the 1st of January 2013.
  3. The third step, which is the step that sets the framework for this particular case, is the introduction of IT support for the procurement process, in this context referring mainly to the pre award process, thus ensuring that the procurement process can be conducted electronically from identified need to invoice and payment. This is the task that has been entrusted to the National Procurement Assistance and Development in 2009. For this final phase there is as of yet no final date set.

Together with the proposed strategy from the newly established Swedish eGovernment Delegation, which is currently on remit, this sets the strategic framework for the initiative described in the case.

Description of target users and groups

The scope of the initiative is very broad, targeting both public sector and suppliers.

On the public sector side, the initiative targets not only public authorities of the state, but also municipalities, county councils and regions, thus involving a total of over 700 different contracting authorities, ranging from low to extremely high procurement levels in terms of total contract value. Within the contracting authority, the initiative shall offer support not only to more experienced procurement officers dealing with large contracts, but also to more inexperienced staff being involved with for instance direct procurement or call-offs from framework agreements.

On the supplier side, the initiative shall especially take into consideration the specific needs of SMEs in the procurement process and how eProcurement can help to remove barriers and resource-consuming elements.

A final important target group is the private market suppliers of eProcurement platforms in various forms and sizes. This target group plays a key role in the development of eProcurement and offers interesting considerations in terms of balancing the private market against a national and centralised initiative.

Description of the way to implement the initiative

As the initiative is still fairly young, we are still trying to find our ways in terms of what is the most successful implementation approach. The Swedish National Financial Management Authority has successfully adopted an approach for the introduction of eInvoicing, which is now being refined in the process of introducing eOrdering. This approach will naturally serve as an important framework also for this final step of the electronic procurement process. There are also valuable lessons to be learned from other EU countries which have launched similar initiatives, although they cannot apply without consideration to the specific Swedish circumstances at hand.

There are however a few key components that can be identified, which are critical to a successful development of eProcurement in Sweden and to the introduction of a full electronic support for the procurement process.  

  • The issue of private market platforms vs. "a national platform"

One of the main critical components of a successful implementation of electronic support for the procurement process is the issue of how to balance the existence of a strong private market of eProcurement platforms/systems and the desire to have an increased control and supervision over the general development of eProcurement in Sweden. For eInvoicing and eOrdering, this issue has been partly solved through placing demands on system suppliers in framework agreements (on eInovicing/eOrdering platforms/systems), which are mandatory for public authorities but not for municipalities, county councils or regions. Whether this is a suitable approach for this third step remains to be seen, but the key to success here is clearly to find a solution which allows for a continued development and competition between private market platform suppliers, while still retaining the possibility to influence national development, placing demands on interoperability and accessibility, thus creating a sense of "a national eProcurement platform".   

  • Decentralised procurement vs. a national government initiative

Public procurement in Sweden is a highly decentralised structure, which also offers some interesting questions for a successful implementation and management approach. A certain centralisation is offered through a number of coordinated framework agreements, available for public authorities under the state, and through various joint initiatives between municipalities and county councils, but the majority of public procurement is still decentralised and conducted within the individual contracting authority. This means that a successful implementation in many ways must take a softer approach, communicating the possibilities and benefits of following the development of eProcurement on a national level, rather than introducing regulations and policies guiding the development.

  • Puzzling the pieces together - pre award meets post award

The Swedish model of a three step introduction of eProcurement also offers its specific consequences for implementation and management. Separating pre award and post award has its benefits, as they in many ways engage different parties, systems and processes, but at some point they also need to meet in order to achieve a seamless and unbroken flow of electronic information throughout the procurement process. The new electronic procurement procedures also tend to even more question the natural barrier between pre and post award processes. Addressing the various interoperability issues in this interesting border area is thus also a key component in a successful implementation of this third step, attempting to complete the puzzle as laid down in the Swedish action plan.

Return on investment

Return on investment: Not applicable / Not available

Lessons learnt

So far, the main lessons learnt from the initiative are:

  • It's an almost impossible task to keep all stakeholder groups satisfied with each project or strategic development decision, especially when dealing with a highly decentralised public procurement structure and a strong private market of platform suppliers.

 

  • The importance of coordination and cooperation between public authorities involved in the strategic development of eGovernment cannot be stressed enough. eProcurement can often be utilised as a catalyst for other eGovernment areas, and it is important that it does not develop in the direction of specialised solutions suitable only for procurement purposes or solutions only applicable within a strict national context.

 

  • The importance of the chosen technical solution is minimal in comparison with the importance of adequate policy change and a solid political will to develop eProcurement on a national level. Communicating the benefits of a conversion to electronic procurement and raising awareness and a real understanding is a task that can never be underestimated.  
Scope: National