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\central government procurement

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Practice: A procurement skills exercise OGC Procurement Cycle An Effective Procurement Strategy why important in the Public Sector? Annual ... – PowerPoint PPT presentation

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Title: \central government procurement


1
\central government procurement
2
Objectives
  • To understand
  • Procurement what is it?
  • What makes procurement a topical issue in central
    government?
  • What is the Office of Government Commerce (OGC)
    and its role?
  • What is the OGC Procurement Cycle?
  • Practice A procurement skills exercise

3
OGC Procurement Cycle
4
An Effective Procurement Strategy why important
in the Public Sector?
  • Annual procurement spend
  • Public sector 125 billion
  • Central Govt Agencies 15 billion
  • Management of procurement and commercial
    activities -gt savings
  • Programmes and projects (e.g. OGC Gateway method
    for scrutinising project progress largely
    involves assessing procurement processes)

5
What is Procurement Good Practice?
  • Economy
  • Get the price down
  • Savings for front-line services
  • Efficiency
  • Balance whole life cost fitness for purpose
  • Embed efficient ways of working
  • Coordinate public sector procurement

6
What is Procurement Good Practice Contd
  • Effectiveness
  • Procure fit-for-purpose goods/services
  • Public/ private partnerships
  • Treat suppliers fairly
  • Open government markets to competition

Other Sustainable procurement practices (e.g.
carbon neutral government estate by 2012) Meet
EU rules
7
The OGC
  • Established post Gershon Review (1991)
  • A one stop shop central procurement
    organization
  • Powers to set high performance standards on
    procurement/project management
  • Monitor Departmental performance
  • Facilitate inter-departmental collaboration
  • Develops relations between public sector buyers
    and suppliers
  • Government Procurement Service (GPS) represents
    and supports procurement professionals across
    government.

8
OGC Procurement Cycle
9
Relationship Management
  • Adequate resources required
  • Overhead' in-house resource (estimated 2
    contract value)
  • Aspects of contract and relationship management
    include

10
Relationship Management
  • Planning
  • Resource considerations (for goods/services) to
    achieve completion within timescale
  • Procurement plan
  • Effective lines of communications
  • Contract manager
  • Methods of contract monitoring and reporting

11
\the red and blue exercise
  • A Procurement Skills Exercise

12
Objective
  • The objective of the exercise is for your group
    to end up with a positive score

13
Procedure
  • Each team plays either a red or a blue card in
    each round by giving it to their team rep (Nicola
    or Amana)
  • The choice will not be announced until both teams
    have played
  • There will be TEN rounds
  • After the FOURTH round possible conference
  • After the EIGHT round possible conference
  • The NINTH and TENTH rounds score double points

14
Remember
Scoring
Group 1 plays Group 2 plays The score is Group 1 Group 2
RED RED 3 3
RED BLUE -6 6
BLUE RED 6 -6
BLUE BLUE -3 -3
  • The objective of the exercise is for your group
    to end up with a positive score.

15
Conclusion
  • Decisions that were dominated by competitive
    winning psychologies were counter productive
  • Aggressive and competitive negotiations were
    experienced within and between the teams
  • Its very easy to be led astray

16
Conclusion
  • Maximum score 72 points
  • Minimum score -72 points
  • Total points in game is zero
  • Lowest risk strategy 36 points each
  • Total points in game is 72
  • Successful negotiation should end in a win-win
    situation
  • Too aggressive - the negotiation could fail
  • Too passive does not achieve best value

17
\negotiation skills
18
Goals
  • What do you want to get out of the negotiation?
  • What do you think the other person wants?

19
Relationships
  • What is the history of the relationship?
  • Could or should this history impact the
    negotiation?
  • Will there be any hidden issues that may
    influence the negotiation?
  • How will you handle these?

20
Trades
  • What do you and the other person have that you
    can trade?
  • What do you each have that the other wants?
  • What are you each comfortable giving away?

21
Alternatives
  • If you dont reach agreement with the other
    person, what alternatives do you have?
  • Are these good or bad?
  • How much does it matter if you do not reach
    agreement?
  • Does failure to reach an agreement cut you out of
    future opportunities? And what alternatives might
    the other person have?

22
Style is key
  • For a negotiation to be 'win-win', both parties
    should feel positive about the negotiation once
    it's over.
  • Displays of emotion are inappropriate because
    they undermine the rational basis of the
    negotiation and because they bring a manipulative
    aspect to them.

23
Successful negotiation
  • The negotiation itself is a careful exploration
    of your position and the other persons position.
  • The goal is finding a mutually acceptable
    compromise that gives you both as much of what
    you want as possible.
  • In an ideal situation, you will find that the
    other person wants what you are prepared to
    trade, and that you are prepared to give what the
    other person wants.

24
Successful negotiation
  • If this is not the case and one person must give
    way
  • It is fair for this person to try to negotiate
    some form of compensation for doing so the
    scale of this compensation will often depend on
    the many of the factors we discussed above.
  • Ultimately, both sides should feel comfortable
    with the final solution if the agreement is to be
    considered win-win.

25
Successful negotiation
  • Only consider win-lose negotiation if you don't
    need to have an ongoing relationship with the
    other party
  • Having lost, they are unlikely to want to work
    with you again.
  • Equally, you should expect that if they need to
    fulfill some part of a deal in which you have
    "won," they may be uncooperative and legalistic
    about the way they do this.
  • Reputation is at risk
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