NIGP 2014 Public Procurement Benchmark Survey Daniel G. Bauer, Managing Director Public Procurement Research Center Florida Atlantic University ©NIGP 2013

Today’s Agenda Executive Summary Overview and Background Why Benchmark at all? Q&A Session ©NIGP 2013

What We Will be Discussing Today Findings Implications Recommendations ©NIGP 2013

Agenda Items – Executive Summary Overall Trend Line indicative of increasing importance and visibility associated with Public Procurement Public Agencies are increasing time, human resources, financial resources, and public relations Varied Complexity of the Profession ©NIGP 2013

Overview and Background - Generalizability of Survey Data Limitations surrounding Methodology Multiple Lessons and Courses of Action ©NIGP 2013

Overview and Background Post Great Recession of 2008-2009 Fiscal and Economic Readiness Criticality compelling Procurement to Lead From the Front Increasing Financial Performance (38% Survey) Stakeholder Customer Satisfaction Rates (75%+) Public Procurement and the Five Factor Analysis ©NIGP 2013

Why Benchmark at All? Obtaining efficiency, effectiveness, excellence necessitates continuous reform Reform is contextual demanding benchmarking (a point in time & place) Too Tedious – here are your challenges ©NIGP 2013

Why Benchmark at All? The Challenges of Complexity Proliferation of Public Organizations Increasing Volume and Types of Transactions leading to: Innovative Technology Delivery Systems Methodological Scorecard denoting Performance

Survey Findings Categories (45 Questions) General Demographics 1-7 Entity’s General Procurement Parameters 8-15 Contract Award Authority 16-18 Protests 19-20 Estimated Savings and Revenues 21-23 ©NIGP 2013

Survey Findings Categories Positions, Training, and Certifications 24-27 Organizational Structure 28-29 Thresholds 30-32 Performance and Practice Indicators 33-41 e-Procurement 42-45

Survey Data Findings Major Points General Demographics Level of Government Worked Regional/State 43.56% Local municipal/township 33.66% Other: special district authority 19.80% Total Expenditures during Fiscal Year Of 38 respondents, 68.4% indicate between US$1M-500M 62.38% of total respondents unable to provide this information

Survey Data Findings Entity’s General Procurement Parameters Use of numerous cooperative procurement solutions and Programs (all >50% use) Piggy Back Contracts Multiple Award Schedule Contracts Joint Solicitation Third-Party Managed

Survey Data Findings Contract Award Authority Client Departments 32.73% do not delegate authority to client departments Unlimited Authority 3.64% 64.63% possess delegation of authority levels tied to dollar value

Survey Data Findings Protests How many during last fiscal year? 39.28% either do not track or prefer not to answer

Survey Data Findings Revenue Sources Surplus property disposal Rebates from P-Card Programs Administrative Fee use of procurement contracts Estimated Cash Savings and Revenues 71.70% (36) do NOT track this information

Survey Data Findings Positions, Training and Certifications Dollars Spent on Staff Professional Development (18/42) 42.85% do not know Organizational Structure Centralized with Delegated Authority 36.73%; Centralized for ALL 26.53% Thresholds 22.45% do NOT use minimum amount required for multiple informal quotes

Survey Data Findings Performance and Practice Indicators eProcurement Entity does NOT report savings and/or cost avoidance on competitive sealed bid/tenders (21/39) 53.85% eProcurement 30.43% of entities do NOT use any procurement software.

Implications Critical Thinking Steps Overcoming Inefficiencies Consequences Intended Unintended Outcomes ©NIGP 2013

Recommendations Contract Authority Cooperative Procurement Increase the level of authority under the purview of a procurement officer Cooperative Procurement Increase both percentage of dollar amount spent as well as percent of budget spent to 10% threshold leading to greater efficiency Increase efforts to emphasize cooperative networks while still performing due diligence in contracting Spend Management Tracking of Spend Management by type of purchase and dollar amount transforming into a management tool ©NIGP 2013

Recommendations Use of Technology and eProcurement Increase spend/transaction (eventually to a point where small transactions are done electronically and you can spend time managing outcomes) Implement a program leading to greater total cash savings and lower opportunity costs

Recommendations Training and Professionalization Increase the percentage of FTEs holding appropriate certification Target annual professional development spend as a minimum percent of total spend per procurement FTE Maintain and/or increase annual number of training hours per FTE to a minimum of 40 hours across all procurement related FTE positions

Recommendations Other Recommendations Implement Tracking Program for monitoring and performance of Protests Cash Savings Opportunity Costs Revenues Thresholds

Questions/Comments: dbauer9@fau.edu Thank You! Questions/Comments: dbauer9@fau.edu ©NIGP 2013