JAGGAER Whitepaper: Best Public Sector Procurement Practices
We’re taking a look at JAGGAER’s whitepaper, which reveals how national and regional authorities can catch up with the best global procurement practices.
The whitepaper, which can be downloaded here, explores how central and local governments around the world have been having to “do more with less” whilst meeting increasingly stringent directives and regulatory frameworks. Technology can be the key to answering these challenges in front-line delivery.
Electoral cycles, bad publicity concerns, a lack of clear criteria for evaluations and a lack of digital skills tend to be the biggest limiters to governments, both on a national and regional scale. To keep up with best practices in procurement, organisations must invest in procurement skills, centralise purchasing where possible, consolidate spend data, transition to digital supplier and contract management, and implement a risk management strategy.
Spend visibility is essential, but very difficult to provide when working in the public sector. A lack of visibility will result in a lack of leverage over spend. There is often very little information that is detailed enough to provide governments with an insight into procurement, even in major spend categories. This leaves them without the data needed to quantify spend with any individual supplier.
Integrating public sector procurement bodies with national and multinational systems is also essential to ensuring source-to-pay success. Within the European Union (EU), tenders above a certain level must be submitted through the Official Journal of the European Union (OJEU), and supplier information is kept within a single procurement document. This ensures a single version of the truth, and greatly improves transparency.
Sustainability, local employment issues and other corporate social responsibility (CSR) challenges must also be addressed by governments. The UK’s Public Services (Social Value) Act 2012 means all public sector organisations must consider economic, social and environmental wellbeing. All UK-based public bodies must think about how the services commissioned might improve social, economic and environmental wellbeing in the area.
This Act ensures that public spending can be leveraged in all three recognised pillars of sustainable development - social, economic and environmental.
Ethical and moral behaviour should uphold every value of a public service, ensuring impartiality, accountability and transparency. Procurement professionals need to ensure they are always working to regulatory frameworks.
One of the biggest things limiting public sector organisations from overcoming these challenges is the lack of investment in procurement skillsets. The US-based Public Spend Forum recently stated: “The role of procurement in the government space is overlooked and thought of as a clerical role. But when you consider these individuals are responsible for purchasing goods and services that total $2 trillion a year in government dollars, the importance of the role becomes much more obvious.”
It is essential to ensure that the people supporting public policies, from infrastructure improvements through to national security, are properly supported, trained and educated to ensure all decisions made are correct.
Pandora and IBM digitise jewellery supply chain
Pandora has overhauled its global supply chain in partnership with IBM amid an ecommerce sales boom for its hand-finished jewellery.
The company found international success offering customisable charm bracelets and other personalised jewellery though its chain of bricks and mortar retail destinations. But in 2020, as the COVID-19 outbreak forced physical stores to close, Pandora strengthened its omnichannel operations and doubled online sales.
A focus on customer experience included deploying IBM’s Sterling Order Management, increasing supply chain resiliency and safeguarding against disruption across the global value chain.
Pandora leverages IBM Sterling Order Management as the backbone it its omnichannel fulfilment, with Salesforce Commerce Cloud powering its ecommerce. Greater automation across its channels has boosted the jeweller’s sustainability credentials, IBM said, streamlining processes for more efficient delivery. It has also given in-store staff and virtual customer service representatives superior end-to-end visibility to better meet consumer needs.
Jim Cruickshank, VP of Digital Development & Retail Technology, Pandora, said the digital transformation journey has brought “digital and store technology closer together and closer to the customer”, highlighting how important the customer journey remains, even during unprecedented disruption.
"Our mission is about creating a personal experience and we've instituted massive platform changes with IBM Sterling and Salesforce to enable new digital-first capabilities that are much more individualised, localised and connected across channels and markets,” he added.
Pandora’s pivot to digital
The pandemic forced the doors closed at most of Pandora’s 2,700 retail locations. To remain competitive, it pivoted to online retail. Virtual queuing for stores and virtual product trials via augmented reality (AR) technology went someway to emulating the in-store experience and retail theatre that is the brand’s hallmark. Meanwhile digital investments in supply chain efficiency was central to delivering on consumer demand.
“Consumer behaviour has significantly shifted and will continue to evolve with businesses needing to quickly adapt to new preferences and needs,” said Kareem Yusuf, General Manager, AI Applications and Blockchain, IBM. “To address this shift, leading retailers like Pandora rely on innovation to increase their business agility by enabling and scaling sustainable supply chain operations using AI and cloud.”
Yusuf said Pandora’s success was indicative of how to remain competitive by “finding new ways to create differentiated customer experiences that protect their enterprises from disruptions to help mitigate risk and accelerate growth”.