About Procurement Capability Reviews (PCRs)

What's New - Tranche 2

The reports from tranche 2, comprising the Department for Transport (DfT) the Department for the Environment, Food and Rural Affairs (Defra) and the Department for International Development are now available. Each report includes findings and recommendations in relation to the department's procurement capability in nine key areas alongside a response from the respective department outlining the actions they are going to take as a result of the findings.       

 

Scope

In tranche 2, the review teams typically conducted around 90 face-to-face interviews with staff and key stakeholders in each department, and there were a further 50 telephone interviews with suppliers and other stakeholders.  This is a significant increase on the tranche 1 contacts.  Review teams are finding that in order to fully unpack the complexity of the departments and the issues raised, and to ensure they have thorough validation of all the evidence leading to their conclusions, they need to speak to a very wide range of people.    

 

Progress

Although the programme is less than half way complete, the end of tranche 2 means that OGC is better placed to identify the key themes and trends emerging from PCRs. The top "improvement areas" or potential issues that seem to represent the biggest challenges for departments are as follows:

• a shortfall in highly capable commercial people;
• a shortfall in contract management skills and resources;
• the paucity of Management Information;
• lack of consistent measurement of performance;
• difficulty influencing spend outside the core department.

The tranche 2 report also looks at some other themes where the evidence from different departments is more mixed:

• commercial strategy needs to be developed, and alignment of procurement with the business could be improved;
• supplier relationship management needs to be more consistent;
• there is a need for greater knowledge management and sharing;
• category management could be developed further.

Tranche 3, comprising reviews of the Department of Health, Home Office and HMRC is currently underway and the findings will be published in Autumn 2008.      

About Procurement Capability Reviews

Purpose

Procurement Capability Reviews were announced for all Government departments in January 2007 as a key enabler of the Transforming Government Procurement report. Focussing on where a department's money is spent and how it achieves value from that spend, a PCR provides an independent, strategic view of the overall procurement capability of the organisation and its wider network of agencies, identifying exemplars as well as areas for improvement. OGC is committed to delivering 17 reviews by December 2008.

Procurement Capability Reviews (PCRs) are a central element of Transforming Government Procurement.  They will assess how far government procurement meets the demanding standards required to deliver value for money services now and in the future. Working with Departments in concert with other OGC workstreams and HM Treasury, the reviews will drive improvements in procurement capability where the greatest impact can be achieved.

Scope

The reviews perform a challenge function at strategic and structural level, covering the widest definition of procurement from commodities through to complex PFI projects. The department's procurement activities across the whole lifecycle, from policy and strategy to delivery and disposal, are considered. Programme and project management (PPM) capability is therefore included in the review. The full length of the department's delivery chains are explored, from central departmental functions, through to Agencies, Non-Departmental Public Bodies, partners (commercial and non-commercial) and end users.

OGC's Procurement Capability Reviews complement the Cabinet Office's programme of capability reviews, by focussing on the contribution of procurement capability to successful delivery. PCRs draw upon these and other sources of information including NAO reports and Gateway Review summaries.

The nine areas examined as part of the reviews are: Visibility and Impact of Leadership; Business and Policy Alignment; Stakeholder and Supplier Confidence; Resourcing; Intelligent Client Capability; Governance and Organisation; Sourcing and Collaboration; Use of Tools and Techniques; and Knowledge and Performance Management.

The Review Model

The review model has been piloted and further reviewed following completion of the Tranche 1 PCRs. A  baseline version 1.0 has been published. Development of the model forms part of the ongoing programme.

Procurement Capability Review Model - Version 1.0 (PDF, 656KB)

The review teams include high calibre commercial, procurement and PPM experts drawn from the public and private sectors. Reviews take place over an intensive period of three to four weeks, following extensive preparation. The programme includes a moderation phase between each tranche of three to five reviews. Following moderation, scores and departmental improvement plans are published. OGC will monitor progress via stocktakes and will follow up with a second round of reviews after 24 months.

Benefits

PCRs provide an independent, strategic review of government procurement, identifying exemplars as well as areas for improvement. Departments will be able to see how others are performing and pan-government lessons will be identified. Suppliers and non-commercial partners will have the opportunity to inform the reviews and will benefit from the resulting improved capability in the delivery chain. Expert input will support procurement directors in raising the impact and influence of the procurement function, resulting where needed in earlier consultation on strategy and policy decisions; investment in targeted development of professional expertise; more control over spend and access to the best government deals, all ultimately leading to greater value for money and improved public services.

Further Information

For further information contact the OGC Service Desk: T: 0845 000 4999   E:  ServiceDesk@ogc.gsi.gov.uk.