Public & private sector procurement – what do you think of the differences?
We published the results of the survey on the differences between public and private sector procurement a while back. The survey was carried out in conjunction with the organisers of the eWorld conference. We intended to publish the results of the final question, which was a free text “Please add any comments you have about the differences between procurement in the commercial and public sectors”.
But we forgot! So here is a selection of the comments – you can see the whole selection here...
While a few believed that the two sectors really aren’t that different at all, others disagreed; we found a few opinions that trended throughout the answers. The first of which was about how the Public sector is “too routine” and not flexible enough due to regulations and having to meet certain targets:
“The EU regulations and the effect they have on the whole process reduces the flexibility that public sector buyers have.”
“I see the main difference being the recognised value and strategic benefits that procurement can bring to the organisation; in private, it is seen as integral to the organisation, however in public its merely routine /operational / transactional...almost a means to an end”
“Private sector are more flexible and open to innovations; they are profit and people driven. Public sector is highly regulated and sometime can be seen as inflexible.”
“Procurement in the public sector (local government) is mechanically driven to meet procedures/regulations and often interfered with politically. Risk of challenge is not seen as a serious concern.”
“Because of the Public Contracts Regulations most of the public sector is too risk averse to procure effectively”
“One significant difference is that the public sector seems frightened to talk to suppliers, relying too much on the use of formal processes & arms length negotiations.”
“Public sector procurement is too rules based (for very understandable reasons) to allow for much innovative procurement and to take advantage of shifts in the market.”
Others believe one of the main differences lies within the skills of each sector.
“The profession is under skilled and complacent. We need to recruit young professionals with university degrees, give them massive drinks from firehoses in training, and manage their careers with balanced assignments in numerous ‘Specialties’.”
“The general perception is if you work in the public sector you are lazy with poor skills and wouldn't last five minutes in the private sector where the real work gets done.”
“For all the grandstanding announcements of this government's focus on driving up standards the standard of basic skills has deteriorated over the few years, an issue that is not truly addressed”
“The standard of central government procurement delivery skills is lower than any time I can remember over the past 25 years”
“Whilst the private sector inevitably has more commercial focus, the public sector often underestimates its own skills, particularly given the very different legislative environment that we work within.“
Some believe this is down to lack of communication and leadership skills.
“Procurement lacks leaderships skills and teeth, is too easily told what to do and does not have sufficient support at Exec Director level. In the commercial sector you have the full range of capability from well run, well resourced, appropriately governed procurement units running efficiently and effectively whilst maintaining a suitably risk controlled environment.”
“My department (Public sector) is so huge that communication from senior levels often seems diluted or ineffective and doesn't drive performance or change among the staff delivering procurement.”
Others believe it’s down to the Public sector having to take much more into account when going through the procurement process.
“Public sector procurers have to put up with more - adverse headlines,constant government interference, competing priorities (aggregation for savings v disaggregation for SME involvement), more legal uncertainty, the constant pressure of challenges etc.”
“Public sector procurement has to juggle so many more objectives, outcomes and stakeholders than the private sector than just looking to provide an improved service or margin. It is also still seen as a functional service and therefore under-resourced and not seen as a key player in delivering corporate objectives”
“Propriety, transparency and compliance place greater demands on public sector people and processes.”
Moving away from the more popular opinions, a few of our survey participants made some interesting opinions about what differences they think lie between the private and public sectors in procurement, including:
“The profession must be larger: Acquisition. Not just purchasing or procurement. CIPS must move up the food chain and produce acquisition professionals who can operate equally well in public or private sector. They really are not that different.”
“The differences are always down to the quality of procurement leadership and the level of top level support the function attracts”
“My concern is that we are experiencing too much central control at the moment and this could leave a a pool of talent on the fringes being neglected and and forgotten.”
“Biggest difference I have seen to date has been the value the organisations place on procurement - public sector pretty much still sees procurement as a means to place orders and have goods delivered - they do not understand the potential value add at this time and look to procurement to just make baseline savings”
What do you think are the differences, if any, between procurement in the private and public sectors? We’d love to hear your opinions!
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