Neil MacKenzie - Partner, Procurement
Simon Culliford – Senior Consultant, Procurement

The content of the Green review in Central Government comes as no surprise. Sir Philip Green's blunt criticism of procurement in Central Government may seem harsh, but it rightly confirms the need for fundamental change.

Like a private sector organisation with different operating divisions, Central Government needs to face the market as one entity.  This requires more than just a mandate for central contracts.  It needs a new operating model with three important building blocks.

Governance

Central Government should mirror Private Sector best practice, ratify the role of Chief Government Procurement Officer (CGPO) and create a Procurement Board with total accountability. They also need the authority to make things happen. The Commercial Directors’ group is effective and with real authority and a Cabinet Office appointed CGPO it can drive the change.

Structure

Central category teams, with talented specialists and the remit to make real commitments, are laudable and long overdue. The parallel how multi-division companies organise for indirects is clear. The target of £400 million pa over four years on £12 billion is challenging and doable but, perhaps, not ambitious.

As Nick Clegg supposed during the election, making a difference will mean focusing away from “pot plants and paper-clips” and looking at programme expenditure. Much is unique to Departments but some is common and will derive cost reduction if corralled. The DWP’s shared service centre works with other Departments and this cooperation might be extended to lead buying for such as environmental services, occupational health and security services.
 

Information

It is recognised that better information will derive better contracts, drive compliance and performance management and enable process improvement. It is also recognised that a fragmented systems landscape is a problem. It is possible to establish an architecture that will deliver interoperability and provide information in consistent format. The required information is held within Departmental systems; getting at it and presenting it in a usable format is about specifying and building an architecture using off-the-shelf specialist applications, such as, spend, content and contract management.
 

Conclusions

The ERG has made an excellent start. Ministerial support and involvement has been achieved – perhaps for the first time. Francis Maude has proved that improved supplier management be a benefit! Centralisation is on its way and resources are being put in place to make things happen. The right governance, structure and systems architecture are absolutely critical to the success of both Central Government making savings and WPS participation later.

Atos can provide support and help make a difference. With our award-winning combination of procurement and technology skills and our experience bring private sector approaches to the Public Sector; no-one is better placed to help join it all together!
 
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