Open standards in public procurement stimulating innovative business solutions

1. Open standards in public procurementstimulating innovative business solutions Steppin Expert Meeting ‘Best Practice‘ Aachen, Germany, 10 July 2007

2. Agenda 10.00Opening of meeting 10.10 Introduction STEPPIN project 10.30 Best Theory in the light of reality, first results of a qualitative survey of European procurement organisations 11.00 Interesting Practices and example cases 12.30 Lunch 13.15 The use of performance based standards 13.45 Point of View of a purchaser.  14.15 Thee/coffee break 14.30 Discussion, Central conclusions / consensus 15.30 Next steps 16.00 End of meeting

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4. This is innovation!

5. Overview Steppin Project • Context • Ambitions and Objectives • Methodology • Red issues and Challenges • Results

6. Context • Public administrations are the largest consumers of goods and services: > 15% GNP • Impact of public procurement on economy is huge • Open standards contribute to innovation, therefore to economic growth • Public tenders offer formalised process where reference to standards often are made So EU concluded: • More insight is needed into the potential to improve innovation performance through reference to standards in public tenders.

7. Does it work? • Can standards really stimulate innovation? • Yes, our presence here today proves it • Some of you booked your trip via the internet • W can use our phones here • We can access our email • We can collaborate with our team members • Couldn’t have done this 10 years ago in the FP4 • Some ICT standards: • GSM • W3C • XML • …

8. Ambitions and Objectives • Stimulate innovation by improving the way existing standards are used in European public procurement processes • What do we need to find out: • How is the current situation, how are standards used. • Which standards do stimulate innovation and which not • How to improve the way standards are used in public procurement ( process, people, organisations) • What do we need to do: • Propose practical guidelines for making reference to innovative standards • Organise workshops in the member states to disseminate and validate the contents of the handbook • Prepare policy recommendations

9. How do we do it Three “STEPPIN Stones”: • STEPPIN stone 1 • create the tools: the proper information has to be made available, useful for all stakeholders • STEPPIN stone 2 • Involve the individuals: all concerned procurement officers should be put in the position to use the tools • STEPPIN stone 3 • Involve the organisations: procurement officers can only change their procurement process when they have backing from their organisation

10. Approach

11. From theory to practice • “Theory” and “good practices” are used for making guidelines and policy recommendations • Analysis of 500 tenders • Interviews with purchasers • Discussions with experts in 2 workshops • 2 stakeholder workshops è Get consensus • 15 dissemination workshops in 15 countries (2008) è Hundreds of purchasers and organisations get involved • Handbook, policy recommendations, database etc available on the Europe Innova website • Create network of procurement professionals è Community

12. Framework Market side Public side Procurement tender Lead Industries standards stimulate innovation user needs User products/services/works Focus of the project is innovation on the market side

13. Standards in the tender process • Position in the tender: • Part of the functional/technical specifications • Selection criteria ( technical capabilities) • Award criteria • Contract • In the RFI document • Outside the tender process: • Internal pre-tender phases (e.g definition of business case, user needs and specifications) • Technical dialogue/market consultation • Market intelligence phase

14. Issues & Challenges • Issues requiring special attention: • Objective: Innovation in the market and not the innovation of the procurement process • Which markets do we focus on? • What makes a purchaser tick? He/she doesn’t buy innovation, but goods or services for a low price, fulfilling the user needs, specifications and quality, delivered on the right moment • Why would a user need innovation: translate innovation into user benefits • How can we measure Innovation using tender results • Challenges: • How to discover Standards that matter • Resolve “friction” between “theory” and “practice” • Keep focus on dissemination! • How to “seduce” purchasers to start doing it

15. Content Group Fraunhofer ISI (D) FIR (D) Corvers (NL) NEN (NL) AENOR (ES) DIN (D) DS (DK) Dissemination Group Virage (NL) PLEON (UK) CEN (BE) CONSIP (IT) BME (D) CIPS (UK) APASP (FR) Partners

16. “Best Theory” workshop • The current situation has been analysed: how standards are being applied in public procurement, what their role is in innovation in this respect and what alternatives experts in this area see for the application of standards. • Definition of the desired/advised role of standards in the process towards innovation via procurement: this definition is called ‘best theory’. • Report with results available in September • Ambition for the workshop: to reach consensus about the best theory with relevant experts in this field in Europe. • Approach: Presentations of results, Presentation of legal aspects, Point of view from a purchaser, Discussions and Consensus

17. Results 1st workshop • consensus about presented framework for “Best Theory” • standards are no problem for purchasers. • purchasing innovative products has risks aspects, the use of standards reduces risks • purchasers need backing from the policy and political levels. • functional specifications generates room for innovation • it is difficult to pinpoint which standards stimulate innovation. • use of performance based standards do stimulate innovation more than specific design standards

18. Ambitions for today • FIR did analyse: • how are standards used in public procurement, • what is their role with regard to innovation • what alternatives experts in this area see for the application of standards. • A definition of the desired/advised role of standards in the process towards innovation via procurement has been made: this definition is the so-called ‘best theory’. • Results will be presented to-day, full report will be available later • Today’s ambition: • to reach consensus about this best practise with relevant experts in this field in Europe. • to discuss a number of related topics and find answers for a number of specific questions. • How: Presentations of results, Point of view from a purchaser, Discussions and Consensus building

19. Issues to be discussed • What do the experts think of the presented interesting cases and do they know similar cases in their own practice? • Good practices may be identified by specific conditional situations. Is this a correct observation? Which situations are most relevant? • Is innovation of importance for purchasers and procurement organisations? • Which aspects of innovation are most relevant in the procurement strategy? • Is the use of performance based standards a practical instrument? • What kind of actions should we consider to change the present purchasing practise to benefit from innovation?

20. Next steps • 2 Stakeholder workshops in October/November to get consensus on best practice and on dissemination methodology. The aim is to define the skeleton of the handbook and policy, do’s and don’ts etc.

21. Examples of conditional situations • Using functional & performance based standards where users/stakeholders have agreed to uniquely use these standards • Using technical standards to specify Input and Output of products and/or services • Using functional & performance based standards with the explicit goal to acquire an innovative solution/product/service