Reducing the barriers companies face when competing for public sector contracts: The UK NHS sid4health case

1. Reducing the barriers companies face when competing for public sector contracts: The UK NHS sid4health case Dr Dimitrios Perperidis Senior Consultant EUROPEAN DYNAMICS dimitrios.perperidis@eurodyn.com 1

2. Improving Procurement Processes • e-Procurement has the potential to yield important improvements in the overall administration of public procurement. However, there is a need to: • Make all procurement opportunities more open and transparent • Make the procurement process simpler: • Encourage Innovation; • Improve Contracting Authority Capability; • Ensure fair opportunities to SMEs. • The timescale from advertising an opportunity to awarding a contract needs to be reduced

3. Qualification of suppliers • Supplier Qualification process: • The selection of suitable suppliers is a very important task in public procurement: • Any misjudgment might lead to an exclusion of a suitable supplier. • The selection of suitable suppliers is based on various eligibility criteria; • It is observed that similar supplier information can be requested in numerous procurement processes: • This process requires significant effort and resources; • Small firms (e.g. SMEs) face substantial difficulties in supporting this process: • Thus, small firms find it difficult compete on an equal basis with larger enterprises which have established collaborations with the public sector and have a much larger business development work force.

4. Qualification of suppliers • Drawbacks related to the Contracting Authorities: • SMEs can provide innovative and technologically advanced products and services; • SMEs can provide better value for money services; • The more suppliers, the better the competition, and hence, the better the quality (in technical and financial respects) of the proposed solutions; • The effort overhead is reflected (directly or indirectly) within the suppliers’ financial offers, increasing the cost of public procurement;

5. Addressing the problem • The UK government: • In 2008, Lord Glover reported: • Opportunities should be transparent; • The process should be as simple as possible; • A strategic approach is required to encourage innovation and give SMEs a fair deal. • In 2011, the new coalition government: • The government is working towards making procurement more transparent and accessible by SMEs. • Thus, an approach for eliminating/reducing the supplier pre-qualification process is required. • The European Commission: • In 2010, the Green Paper on Expanding the Use of e-Procurement in the EU reports on the importance in making procurement more accessible to SMEs.

6. The NHS Sid4Health Platform • The NHS sid4health platform: • Enables suppliers to prepare and manage profiles: • Containing an agreed range of pre-qualification information • Make the profiles available on-line to NHS buyers • Enable suppliers to re-utilise their profiles in a number of procurement processes; • Integration with Dun & Bradstreet • NHS considers this platform as a significant step in order to improve the capability to manage procurement data; • Provides NHS authorities with a common data set for pre-qualification: • Driving good practices; • Facilitating the sharing of information between the NHS authorities; • Enables the transfer of supplier data and profiles to other procurement e-Procurement systems; • Reduces processing costs for both suppliers and NHS authorities.

7. Usage of the System • The system operates since May 2009: • 500 NHS Contracting Authorities are registered in the platform; • 80.000 suppliers are registered in the system; • The specifications of the platform were developed by representatives of NHS, various suppliers and EUROPEAN DYNAMICS; • The platform’s functionality is constantly enchased to address further user needs;

8. Lessons Learned and Conclusions • Lesson 1 (Operational teams): • It was expected that a business change with such a large scale would cause some operational issues (e.g. the allocation of the correct DUNS® numbers). • Having a joint operational team between NHS, Duns & Bradstreet and EUROPEAN DYNAMICS played an important role is resolving all theses issues effectively and quickly. • Lesson 2 (Identification of requirements): • The establishment of the sid4health user group (consisting from NHS authorities and suppliers) was crucial to ensure the good design and development of the platform. • A sense of ownership was enabled by both groups of users (suppliers and buyers). They are now actively involved in designing features for future releases. • Lesson 3 (Keep some things the same): • It was important to reassure certain NHS agencies that they will still have access to all data they previously received from Dun & Bradstreet. • The Sid4health platform included the capability to produce a Dun & Bradstreet report (in the same format that the report is produced by Dun & Bradstreet).

9. Future • Benefits to the NHS: • The sid4health platform has significantly benefited all contracting authorities of NHS. • Extension within the UK: • A similar platform should extend the provided services beyond the limits of NHS in order to be beneficial to a wider base of contracting authorities and suppliers. • The Scottish Government has initiated the sPQQ Project which has a similar scope with sid4health and is due to launch in early 2012. • Pan-European scope: • This initiative should also be extended on a pan-European scope making easier for small firms to extend their market activities across the borders of their countries. • Enable contracting authorities to widen their options by taking the opportunity to capitalize on innovation (and/or better value for money services) which firms from other countries can offer.