Opportunities and Challenges
One of the most significant investments in our nation’s infrastructure, the $550 billion Infrastructure Investment and Jobs Act (IIJA), has begun to release its first waves of funding. While this bill is transformative for states, cities, counties, utilities, and education, there are massive hurdles that must be addressed before any initiatives are implemented. There will be unique challenges public procurement teams will need to address to ensure the bill delivers on its full promise. Chief among these challenges is the need to modernize procurement processes and tools.
Why is modernizing these processes and tools so important?
This bill sends plenty of money to the state and local governments–but along with these allocations comes solicitations, procurements, contracts, deadlines, reporting requirements, and other overhead. The bill will begin to usher in an immense need for experienced public sector procurement professionals to develop new vendors, conduct solicitations, execute contracts, manage performance, and report progress.
This additional workload could be a generational challenge by itself, but when adding this to the general hiring crisis spurred by the pandemic and the “silver tsunami”–the risk increases exponentially. To avoid burning out our existing professionals and attract new experts, Procurement teams will need to reevaluate their processes to ensure professionals can improve their output, satisfy requirements, and meet their goals.
Los Angeles Department of Water and Power (LADWP) Transformation Story (Real Example)
I know what you are thinking–making the needed changes to Public Procurement Processes will seem like a Sisyphean task. After all, Public Sector Procurement does not have a reputation for embracing changes or being quick to improve processes. Right? Well, I acknowledge the concern, but I also consider there is evidence to the contrary that makes me feel optimistic about their ability to adapt. Specifically, the Los Angeles Department of Water and Power (LADWP), is an example where a committed team of professionals were able to make significant changes to process quickly and effectively.
In 2020, LADWP, the largest municipal water and power utility in the United States, was facing a crisis. COVID-19 had closed their vendor liaison office and vendors were no longer able to drop off physical bids in person, nor could they conduct bid opening per their established process. This problem required a fast solution and was not something that would tolerate a multi-phase / multi-year program. They needed a solution quickly. In a matter of days, LADWP worked with a solution provider to establish a portal where vendors could register and submit their bids electronically and then automatically open bids at closing to meet the requirements of their charter with the city.
In two weeks, the LADWP was able to stand-up a solicitations solution with a bid drop-box and a vendor self-service portal. After they designed, built, and deployed the solution, they could register hundreds of suppliers within hours of launching. Not only did they address an emergent operational issue, but they also took the first step toward the digitization of vendor management and purchase order placement processes.
A Path Forward
It is safe to say that opportunities like the Infrastructure Bill come along once in a generation with the potential to improve the lives of many Americans. Public Procurement teams and their partners are entering unfamiliar territory; we have an obligation to capitalize on this immediate opportunity and use this platform to launch sustained change across public procurement.
As a community, we must recognize the ever-growing limitations of our Public Procurement workforces and ensure we arm these workers with the tools they need to be efficient and effective. We need to mobilize and challenge traditional processes and look for areas where we can change, innovate, or automate.
Most importantly–we have to believe that our collective workforce is capable of generating value by managing strategic processes instead of executing manual tasks. We also need to access the power of the Public Procurement community by collaborating with other public entities to leverage cooperatives, pool resources, and learn from the experiences and leadership from stories like LADWP.
Ready to arm your Public Procurement Professionals with the tools they need for modern challenges? Discover Ivalua’s Public Sector Procurement solutions.
Ivalua for Public Sector Procurement Datasheet: Building Procurement Solutions for Modern Government
Jarrod McAdoo brings over 26 years of procurement experience to Ivalua as a product expert for the Analytics & Insights, Supplier Management, Spend Analysis, and Environmental Impact Center Solutions. A frequent thought leadership contributor for the Ivalua Blog, Jarrod has worked across multiple industries, including higher education, public sector, retail, manufacturing, and engineered products. Prior to his time at Ivalua, Jarrod held various roles in category and supplier management—including strategic sourcing and procurement team management where he led teams to implement shared service procurement models and Source-to-Pay systems. Jarrod holds a Masters in Business Administration (MBA) from Duquesne University and a Bachelor of Science degree from Carnegie Mellon University.