The Procurement Process Should be Fit For Purpose

The New York Times recently publish an interesting article on the difficulties in running a 21st century procurement process to support the growth of wind power in Chicago.

They describe the procurement process as “byzantine” explaining that  “an obscure state agency decides where that wind power comes from has stalled development of new wind farms and threatens to curtail Illinois’s wind generation for years to come”.

They go on: “A number of companies have new farms sited, permitted and ready to be constructed, but a complicated bidding process playing out through December could determine whether any of them are actually built. Companies say they are caught in a vise. In order to get bank financing to build a wind farm, companies usually need a promise from the Illinois Power Agency — a long-term power purchase agreement — that their electricity will actually be bought for years to come.”

It goes to show that the metrics by which we measure relative strength of bidders need to be in line with what we are actually trying to do. Old fashioned economic metrics in the procurement process that ignore the green agenda will no longer suffice

At a recent Purchase to Pay conference in Amsterdam, representatives from a wide range of industries got together to compare notes – warts and all – on their P2P programmes

It is really interesting when a diverse group of Purchase to Pay professionals from different organizations get together to compare notes. Despite working in isolation, there is a great deal in common in terms of the challenges faced and the approaches adopted to overcome those challenges. But there’s also a healthy variation in approach and below is a short list of some of the best takeaways from the conference. continue reading…