Are purpose-led tenders the way of the future?

Written by: Donna Kirk – Pro Leaders Academy Pty Ltd

Evaluating tenders is what leads to a contract in government. Developing the tender requirements prior to determining the tender criteria is more important as it sets the expectations of the client. Criteria can be based on requirements to meet specific legislation, such as the requirement for the provider to hold certain licences or certification to perform the work, or it can be based on what the client requires from the product or service in order to achieve their objective. Other criteria that is of consideration within government is Value for Money and finding the local benefits of the product and/or service to be sourced or built. And then there is looking at the criteria with a wider lens and asking questions that may or may not have any relevance to the capability of potential suppliers.

An example of this is Vodafone.

Vodafone was highlighted in the news recently as an organisation initiating to embed ‘purpose-led’ criteria into their decision making – including asking potential suppliers ‘What are you doing on diversity and inclusion?’, and ‘What are you doing regarding our planet?’ Questions are being asked about their position in the world that are outside of the product and/or service they seek with an expectation of a response to these questions as part of the tender response.

Marking and scoring tenders according to these criteria might work well for the tenderer, however there may be considerable challenges to small and large suppliers in trying to satisfy the criteria. It seems to be a punitive approach rewarding only those with the resources and knowledge to meet the changing criteria.

While we likely all agree that we need to improve the world around us, we do need to factor in the changes brought about by COVID-19. Many businesses are trying to recover financially from losses and setbacks and are not likely to be in the position to make significant investment into changing their business models or processes to accommodate.

The argument that now is the perfect time to effect change in this manner is sound – businesses could look to do things differently – and they have. People have adopted online meetings with enthusiasm, reducing local travel time and air miles substantially. Businesses of all types have grabbed hold of the work from home concept with true grit and made it work. Do we now ask…

Is now the time to ask them to do even more – or is it time to perhaps slow down and reflect on what incremental changes are realistic and meet the global challenges without forcing businesses to take on even more when they have done so much already?
Can Government do more than just pay lip service to purpose-led criteria? While the evaluation scoring process is simply that, a process used by the evaluation team to determine the relevance or importance of a response to meet the tender’s requirements?
How do we evaluate the relevance of the scoring in relation to the goods or services required based on purpose-led requirements? For example, while it is likely vital a battery supply firm has a clear recycling program for the significant amount of batteries we will purchase, is it as important for the coffee cart who delivers great coffee each day to meet the same environmental criteria?
If a business does not recycle their paper, is that significantly bad?
If a team does not have the resources to investigate whether parts of their supply chain might be impacted by modern slavery – let alone understand that it is, should that preclude them from the tender process?

As procurement and contract professionals, we will do our communities a disservice by supporting only those who can afford change? Or do we think differently and look to work with these businesses in a collaborative approach, taking the lead ourselves as a large organisation effecting the change we want to see?

Is it time to say – how do we work with you to effect change?