Earlier this month, the Federal Times outlined “The 5 trends likely to shape federal contracting in 2020.” But what you may not have heard as much about are the top 10 action items that state government procurement officials will be prioritizing this year. That doesn’t mean they are any less important, though.
In fact, we would argue that it’s more important for companies such as yours (who want to boost your revenue from the public sector) to pay closer attention to what’s happening at the state government level versus the federal level.
- Unlike the federal government, state governments have the freedom to define and execute their own procurement policies and procedures. They don’t have to follow the Federal Acquisition Regulations (FAR) if they don’t want to, which means there isn’t a single standardized procurement framework utilized from state to state. So, you may be well-versed in the procurement processes, policies and procedures of Oregon but find (at an inconvenient time) that its neighbor Nevada doesn’t do things exactly the same way.
- Local governments often follow the lead of state governments when it comes to procurement. (Though, they don’t have to, which opens up a whole other can of worms.) There’s a good chance that if you understand how the Commonwealth of Massachusetts handles its procure-to-pay processes, then you will have a strong understanding of how several local agencies in the state might also operate. (But, again, the best thing is to always verify processes, requirements, etc. with each agency with which you want to do business. State and local government agencies technically can manage procurements however they deem best for their individual entity. But that’s even more reason to pay attention to what’s happening at these levels.)
- Because state and local governments (and non-profits, K-12 school districts, higher education entities and all other public sector agencies outside the federal government) do run their own independent operations, they are constantly re-assessing what’s working and what’s not. As a result, procurement policies, processes and procedures are always changing – and many directly impact suppliers. There are more than 90,000 state and local government agencies alone in North America, which means there could technically be more than 90,000 sets of procurement rules by which you have to play. There aren’t that many variances, thank goodness, but there are 50 different states – each of which is paving its own path to procurement modernization. Therefore, you need to do your research every time you bid to make sure you clearly understand their current procure-to-pay processes. This includes everything from vendor registration requirements to disadvantaged business entity certification processes as well as solicitation, contract award, contract management and payment procedures.
If keeping tabs on each state and local government seems daunting, know that they do share common goals. For example, it was clear from 2020 Top 10 Priority List published by the National Association of State Procurement Officials (NASPO) that there are three potentially widespread changes coming that could impact your bidding experience, contractual obligations and performance rating:
- “Innovative, Solution-Based Solicitation Methods”
- “Analytics for Data-driven Enterprise Decision-Making”
- “Continuous Process Improvement”
Though technically #9 on the NASPO Top 10 priority list, we thought it was important to put this at the top of our notable changes list because your public sector sales, marketing and bidding strategies will need to evolve as states “add other sourcing methods to their portfolio to increase value creation and maximize savings.”
We’ve spoken before about how more governments are starting prefer “best-in-class” solutions over “best price” offerings in many categories, so if you missed that blog post, it’s worth the quick read now. You may also want to check out the post about state and local governments’ increased utilization of “open contracts” and how securing one could benefit you. But one more dramatic change to note is the increased use of “agile procurements.” Though proposal turnaround times are pretty tight already, agile projects could call for shorter lead times – and shorter contract terms. (Get the full scoop in this blog post.)
NASPO reports that “acquiring robust data analytics tools will be paramount to state procurement offices for tracking and better measuring success” this year and beyond. As such tools are implemented, you might find audits and accountability increase. Considering how critical your performance ratings can be to future contract awards, it is imperative that you meet deadlines, exceed quality expectations and prioritize customer service, as we discussed in these two blogs posts:
Why Customer Satisfaction Needs to Be a Bigger Priority for Government Suppliers: Part I
Why Customer Satisfaction Needs to Be a Bigger Priority for Government Suppliers: Part II
You will also want to ensure you have the proper business systems in place to generate the operational data required of government suppliers and contractors, as we talk about here:
Want to Do Business with the Government? Be Ready for Audits
- “Continuous Process Improvement”
While not a catch-all line item, this one does have widespread implications as it confirms that state procurement offices will focus on “continuous assessment of existing processes and policies, leading to process improvement and added value to the procurement process.” In short, this reinforces what we said in the third item of our first list above: things are always changing, and you need to do your due diligence every time you bid. Processes can literally evolve from one day to the next – and not just during periods of government leadership changeover.