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LGP News - August 2017
" Keeping you connected in local government procurement "
How To Make Procurement A Senior Executive Priority?
by Luke Kenny, Chief Executive Officer
Measuring and being able to prove value from procurement is an art few have mastered, in the private or public sector. Today procurement struggles to get any meaningful attention at the most senior level, and if we do it is normally because something has gone wrong, as opposed to a great commercial result.
For local government, we need to work together to target general mangers and harder still, councillors and mayors to stop them seeing procurement as just ‘purchasing’. Until we can start putting significant facts and figures under procurement, councils will never be able to prove that procurement can:
- Deliver cost reductions from expert negotiations
- Avoid cost, mitigate risk and introduce innovation with well informed, and tighter specifications
- Drive employment and small business growth in regional economies
- Achieve lower price points through group purchasing and sector-based aggregation
- Re-deploy scarce and valuable resources by outsourcing various procurement activities
The data to support these, and other measurable benefits exist today. The message here is councils need to extract and analyse this data to establish the value procurement delivers. We need to start tabling data-driven future sourcing and procurement strategies.
Procurement needs to be better at finding and using data to quantify the value we deliver. If we can do this together, and target what matters to general managers, councillors and Mayors then we as procurement will get a seat at the proverbial table.
Forgotten Value
More recently in LGP’s engagement with councils, we are hearing many people explain that departments outside of procurement do not understand why established LGP contracts are helpful, or even valuable. Frustratingly for some in council, surrounding departments who have influence over purchasing decisions do not understand (or don’t want to understand) the work aggregators like LGP conduct on their behalf, and the reasons why this effort need not be duplicated by council.
This might be because we are seeing a flood of new people joining NSW local government due to amalgamations and structural changes. Any council looking to run its own tender, where an aggregated contract already exists needs to ask some pre-qualifying questions, such as the following:
- Is there an existing aggregated contract available for use?
- Does the optional aggregated contract have a greater volume of annual spend compared to the spend I will offer to the market in the proposed council-level tender process?
- Does my council contract mitigate all the risks associated with this category and the contracted suppliers? Do I have the in-house subject matter expertise to protect my council?
- Is the tendering process council applies ethical and probity rich? Are we aware of the leading industry suppliers, will they see our tender, and do we offer enough value for them to invest in a response?
- Does council have the available resources to potentially duplicate a contract, which already exists and is available for council to use?
For those in council who are not aware, or for those people who want to circulate internally how and why LGP contracts can be used without having to go to tender, you can use the detail provided below:
LGP has been ‘prescribed’ by the NSW State Parliament to carry out group tenders on behalf of NSW local government. ‘Prescribed’ means LGP is named in the Local Government (General) Regulation 2005 (NSW) and as such a council does not need to go to tender if that council buys from a contract already set up by LGP. Councils can therefore procure goods or services from LGP contracts for values greater than $150,000 (inclusive of GST), without the need to tender themselves. In fact, for all but 2 of the LGP contracts they can procure up to any value. Naturally councils can use LGP contracts to procure for amounts less than $150,000 without restriction.
Sustainable Choice Membership
We have received an extremely good response from councils who are signing up as paid members to incorporate sustainability within their procurement process. Please be aware we have until the end of August for those councils who want to continue receiving Sustainable Choice services, this is the deadline to confirm their Membership. We are also welcoming councils who are new to Sustainable Choice, it’s great to see that councils are keen to start their sustainable procurement journey.
Shortly we will be approaching our supply partners to consider their ongoing involvement under the new annual paid membership model. Under LGP, Sustainable Choice will continue to provide services to suppliers and contractors. These include your assessed and approved products listed on the Sustainable Choice Database, tradeshow opportunities at Sustainable Procurement Forums. Some of the new services for suppliers include a new high profile web presence to promote approved Sustainable Choice products and services, an active marketing program to councils and national expansion of the Sustainable Choice services and database promotion.
To those suppliers currently partnering with Sustainable Choice, please keep an eye out for your letter outlining all the details and benefits of the new membership model. For those suppliers reading this information and interested in starting up with Sustainable Choice, please register your interest via sustainablechoice@lgp.org.au and we will be in contact.
IT&C Products, Services and Consulting LGP115
LGP is pleased to advise the appointment of NSW Government Digital Community (GovDC) to the IT&C Products, Consulting & Services panel LGP1.15
All councils can use the GovDC arrangement for their Data Centre requirements under the ‘Managed Services’ category. The ‘Data Centre as Services’ under GovDC allows all NSW councils to use the arrangement via LGP along with state agencies, hospitals, universities, NFPs and schools.
The GovDC service is facilitating the shift within NSW government from traditional models of ICT infrastructure to consuming ICT services from the cloud.
Under the GovDC arrangement, the two world – class Data Centres in Silverwater and Wollongong will support the new approach to buying and use of ICT services 'on-tap' and to access additional data centre resources without major capital expenditure. These data centres are purpose built, modern, reliable, secure, energy efficient and operated 24/7.
For more information, email Santhosh Dorairajan, Category Manager – ITC & Services, or call 02 8270 8732.
Image courtesy NSW Government.
Sustainable Choice
New Icon!
Sustainable procurement is about good business practice that focuses on socially and ethically responsible procurement and delivering economically sound solutions while minimising an environmental impact.
Keeping the above in mind Sustainable Choice has designed its new icon to incorporate the four elements of the quadruple bottom line (QBL); Economic, Social, Environmental and Governance.
As the design suggests, each of the four elements work together to achieve the goals of Sustainability and Sustainable Procurement.
Sustainable Choice carefully chose the colour ‘Orange’ for the icon. Orange, a blend of red and yellow, is a mixture of the energy associated with red and the happiness associated with yellow. Orange is associated with meanings of joy, warmth, heat, sunshine, enthusiasm, creativity, success, encouragement, change, determination, health, stimulation, happiness, fun, enjoyment, balance, compassion, freedom, expression, and fascination. Orange will help a person recover from disappointments. All these attributes directly relate to ‘Sustainability’.
Sustainable Choice - Annual Survey
Is Having A Makeover!
The Annual Sustainable Choice survey is currently in the process of being rewritten to incorporate the new International Standard Guidance on Sustainable Procurement – ISO20400.
This will ensure we have a new, effective and valuable tool which will provide a useful health check of member’s performance in Sustainable Procurement. Each Sustainable Choice member will receive a benchmarking report and a scorecard based on the survey results.
A full gap analysis can also be provided for a fee.
Email the Sustainable Choice team for more information or call 02 8270 8703.
LGP Procurement Training
Enhance productivity and become more compliant in procurement processes by up-skilling and acquiring new skills and competencies.
LGP provides a range of innovative learning and development solutions tailored specifically for NSW council staff, delivered via different mediums including face to face and online mode. Through the extensive and exciting gamut of training programs in procurement, LGP can support you in achieving the best outcome from your suitably qualified and skilled staff members.
LGP training programs are offered as the following three suites and you can learn more about each by clicking on the relevant links:
- eLearning: LGP’s eLearning programs use state-of-the-art technology, to deliver cost effective training, specifically designed for NSW local government employees engaged in purchasing, quoting, tendering and contract management. Please click ProcureLearn for more details.
- Face-to-Face Training: Our face-to-face training features a range of interactive and leading practice modules, covering critical areas of procurement and contract management. Please click LGP Learning Centre for more details.
- Nationally Recognised Training (NRT) in Procurement: In partnership with ProLeaders Academy (Registered Training Organisation) LGP offers three Accredited Nationally Recognised Training from Certificate-IV to Advanced Diploma levels, customised specifically for NSW local government employees. Please click Procurement Qualifications for more details.
Grab this opportunity to partner with LGP for your procurement training needs.
There are limited seats available for the Certificate IV Procurement and Contracting qualification starting Tuesday 8 Aug 2017. Register now!
Training Calendar and Registration
To contact LGP Training, email or call 02 8270 8709.
Advanced Diploma of Procurement and Contracting (PSP60616) Block 1 - Successfully Delivered
Local Government Procurement (LGP) successfully completed the delivery of Block 1 of the Advanced Diploma of Procurement and Contracting (PSP60616) qualification at LGP's premises on (19-21 July 2017).
Nine participants representing different councils, both from metro and regional areas attended this course.
Classroom discussions, group activities and training contents delivered in the classroom made up the three days of fun-packed learning and knowledge sharing experience for the attendees. They will be back in the class for Block 2 which runs from 28-30 August and progress further with the next part of this course.
Update - 'Networking in the Bush' - Armidale
The first Networking in the Bush for Northern NSW was held in Armidale on the 25th July, 2017 at the New England Regional Art Museum. The day was a tremendous success attended by procurement professionals from surrounding councils within the region.
The CEO of Armidale Regional Council, Peter Dennis, officially opened the event and the agenda for the day was well received and full of current topics.
Discussions were held on the latest procurement issues in the contract and legal space facilitated by Phill Scott (Head of Tendering and Contracts – LGP) and Monica Kelly (Principal - Prevention Partners). We also heard from Sustainable Choice on the new ISO 20400 for Sustainable Procurement, ArcBlue on the LEAP Program and VendorPanel on their Local Supplier Engagement Tool. In addition, we heard from our 2017 Network sponsor, Boral, who provided the group with insight into procuring with local government from the supplier perspective. The day was wrapped up with a lively Q&A session, where questions from the delegates were discussed and various viewpoints put forward.
We had over 30 attendees representing many different sections of council such as procurement, fleet, finance, engineering, governance, economic development and executive. Councils in attendance included Armidale, Kempsey, Moree, Glen Innes, Clarence Valley, Tamworth, Inverell, Gwydir, Liverpool Plains and the NAMOI Joint Organisation.
A great day was had by all, discussions were robust with excellent networking providing an opportunity for collaboration and sharing of information which was pivotal to the success of the day.
The LGP team would like to thank all those that attended for contributing to a successful day and we look forward to facilitating future networking events in Northern NSW.
The next LGP networking meeting will be held in Sydney on Wednesday 16th August, followed by another regional event in Junee on Thursday 7th September. For further information, visit the LGP website.
UPCOMING EVENTS
'LGP Networking Meeting' - Sydney
Registration Closing Soon!
LGP is committed to supporting local government procurement professionals to achieve efficiencies and drive capability development in procurement.
LGP’s Networking Meeting is designed to bring procurement staff from across NSW together to discuss ideas, current issues and where appropriate work as a team on special projects. The networking meeting provides an opportunity for council officers involved in procurement to meet in an environment where networking and information sharing is conducted, as well as discuss the latest procurement initiatives within local government.
LGP’s metro networking meeting for the year will be held in Sydney on Wednesday, 16 August 2017.
Who should attend?
- General Managers and senior management staff.
- Management staff involved in or overlooking procurement functions eg: tendering management, contract management, and supplier engagement.
- Procurement staff (all levels and sections of council).
Why should you attend?
- Valuable procurement knowledge imparted by LGP subject matter experts.
- Extensive legal knowledge provided by our legal partner at no cost.
- Update of market trends, challenges and solutions in the procurement space.
- An update on sustainability in procurement.
- Free training opportunity for appropriate council staff.
Agenda: Click here
Date: Wednesday, 16 August 2017
Registration: 9:15am. – 9:45am.
Meeting: 9:45am. – 3:15pm.
Location: The Grace Hotel, Level 1, Pinaroo5
77 York Street, Sydney NSW 2000
Cost: Free to attend (lunch provided)
Sponsorship Opportunities
Local Government Procurement
Annual Conference 2017
The Local Government Procurement Conference is an established industry event for NSW local government. The conference provides a unique opportunity for suppliers to showcase their goods and services to a cross section of procurement professionals from across the state over two days. It is also an excellent opportunity to attract potential customers and build on existing relationships already established.
The conference will be held on Thursday 30 November and Friday 1 December 2017 at the Sydney Masonic Centre, 66 Goulburn Street Sydney.
Sponsorship opportunities are limited. Suppliers who wish to participate as a sponsor or as a trade exhibitor can view our Sponsorship Prospectus.
Local Government Procurement
Annual Conference 2017
Registration Now Open!
'Building Procurement Capability and Embracing Innovation' is the theme of the 2017 Local Government Procurement Conference. The key topics covered over the two days will revolve around people and culture, technology, supplier relationship management, sustainable procurement, innovation and future trends.
The Local Government Procurement Conference is an established industry event for NSW local government. The conference provides opportunities to develop new and build on existing professional networks and working relationships and to learn from industry experts and peers.
Local Government Procurement Annual Conference 2017 will be held on Thursday 30 November and Friday 1 December 2017 at the Sydney Masonic Centre, 66 Goulburn Street Sydney.
The conference will bring together local government managers to hear and learn about a range of procurement challenges within the sector. The conference is an ideal event for those involved in procurement, in particular:
- Procurement Managers
- Governance Managers
- Purchasing Officers
- Contracts Managers
- General Managers and Senior Managers
Visit our website to view updated information, or register your interest here to receive conference updates direct to your inbox.
Local Government Procurement
Consulting Team
Often councils do not have the time or required resources to dedicate to procurement. With this in mind, LGP has a specialised team with over 20 years’ procurement experience in local government and global organisations to provide personalised and customised support to councils in relation to their specific procurement projects. Some of the services offered by the Consulting Team on a very competitive ‘fee for service’ basis are listed below, these include, but are not limited to:
- RFX facilitation
- Review and development of procurement processes, policies and procedures
- Probity advice and audit services
- Customised supplier tender training
- Contract management
- Procurement project management
- Council specific procurement training
Over 40 individual and customised projects have been delivered to both local and regional councils. These projects have delivered councils requirements for due diligence, probity, fairness and transparency. The process delivered by the Consulting Team ensures best practice and is in accordance with the Local Government Act 1993 (NSW) Section 55, Local
Government (General) Regulation 2005 (NSW) Part 7 Tendering and Tendering Guidelines for NSW Local Government 2009.
For more information, please email the Consulting Team or call 02 8270 8747.
Leading Efficiency & Analytics Program - LEAP
Procurement is one of the major activities which affects the organisation's bottom line. Often the challenge in procurement is to extract maximum benefit from the activity of acquiring goods and services while getting the best value.
Following on from the successful launch we had two successful LEAP webinars where we had over 90 attendees in total who showed keen interest in the product and were eager to learn how the program would benefit their council.
Local Government Procurement in partnership with ArcBlue invite you to join our upcoming webinar where we will explain our new Leading Efficiency and Analytics Program (LEAP), a low-cost ongoing continuous improvement program that uses real data and evidence to improve procurement capability.
The program delivers:
A solution giving better visibility and categorisation of spend
Highlights cost saving opportunities across various categories
Allows benchmarking to drive continuous improvement of procurement
Performance tracking through sector and regional benchmarking
Ability to monitor procurement compliance with policy and probity
We will explain how we can support procurement improvements through use of technology and data, and how you can effectively manage data to deliver a greater service solution.
Date: Wednesday, 6th September 2017
Time: 9:30am - 10:15am
Cost: Complimentary
Want to Know who Your Business Development Manager is at LGP?
Local Government Procurement has a dedicated team to look after the needs of councils, approved contractors, not for profit organisations and other government bodies.
Click here to see who can help you.
Sustainable Choice - The Sustainable Approach to Procurement in Local Government
Sustainable Choice assists local government to integrate sustainability into their procurement systems and purchase sustainable products and services. Every purchase counts and Sustainable Choice can make it easier; it’s the responsible and sensible approach to procurement.
Find out more about Sustainable Choice, its products and services click here.
NEW STAFF
LGP welcomes Santhosh Dorairajan to the team in the role of Category Manager-ITC & Services.
Santhosh brings a wealth of knowledge and experience, having worked in the Commonwealth Government sector in high level procurement positions. His qualifications began with engineering and include management, government and ICT Procurement. He has a Master of Business (UTS). Santhosh is very approachable and keen to work with you to make our contracts and arrangements as effective as possible. He will be at the next LGP Networking meeting in Sydney, which is scheduled for Wednesday 16 August 2017.
Radio Frequency Identification (RFID) Systems, Equipment, Associated Products & Services (LGP309-2)
Local Government Procurement has determined that on the basis of limited usage of this panel contract, it will no longer provide this panel contract.
The expiry date of this panel contract is 31 December 2017. From 1 January 2018, subject to council’s own procurement guidelines and legislative requirements, the goods and services available under this contract may be available to purchase from relevant suppliers.
Do you know who you are contracting with?
This month’s article deals with a case that looks at how to prove to a court that you are contracted with the entity you think you are contracted with.
The facts
As the judgment states, the appeal was concerned with the liability of the appellant, (the parent company in a large group), ‘for damage suffered by the buyer when concrete slurry that was being pumped through pipes failed to flow properly, causing damage to the pipes and loss of the concrete. The buyer claimed that the parent company was the supplier of the concrete and that the concrete was not fit for the purpose for which it was intended’.
One of the arguments of the appellant (the parent company) was that the buyer was in fact contracted with its subsidiary, not the parent company. This was a point that the primary judge dealt with and was revisited in the appeal. It is this point that is discussed herein.
Message to take away
- We must always undertake company searches of potential contractors and ask, ‘which entity am I contracting with and what role will the parent company take in this contract?’
- The problem may arise when a supplier organisation consists of a parent and subsidiary companies with similar names.
- Try to read your contracts, and other legal documents, from the objective onlooker’s perspective.
Monica Kelly from Prevention Partners explains more here.
VendorPanel Drives Better Fleet Pricing for City of Canada Bay, Saving Council Thousands
“We’re saving up to a couple of thousand on every car we’ve bought”
When Kevin Mandell joined the City of Canada Bay in the role of Strategic Procurement Coordinator, the purchasing of vehicles for council was not where he wanted it to be. The State Government had a vehicles contract in place but to Kevin, it seemed like the rates provided by dealers had been ‘pulled out of the sky’. There had to be a better way.
Kevin introduced VendorPanel into council and set up a panel for local vehicle suppliers. The NSW State Government vehicle contract was the source of the dealers and he invited a total of 100 dealers across NSW and all dealers located within 25 km of Canada Bay onto the panel. It was important for Kevin to focus on this 25 km range, to give the local suppliers a chance to quote.
30 dealers accepted the invitation to supply vehicles at the state contract rates and Kevin started sourcing vehicles through these dealers. Immediately, Kevin saw benefits.
“We found that rates being provided by the dealers were a lot better than we had previously been getting. We’re saving up to a couple of thousand on every car we’ve bought”.
Given the City of Canada Bay is sourcing around 50 vehicles per year, that translates to significant savings for council. On top of this, council was often getting vehicles with higher levels of appointment such as leather seats and additional accessories, as dealers tried to move stock.
It is clear that the competitive tension VendorPanel injects into the sourcing process is translating to savings and a better quality product for the City of Canada Bay.
“The panel has now grown from 30 dealers to 50 dealers and the additional dealers have approached us wanting to be included. If we need a Toyota, we’ve got 7-8 dealers it will go to. It forces them into sharpening their pencil”
Kevin also points to the other benefits provided by VendorPanel.
“Everything is in one place, we purchase vehicles via our fleet services and all our heavy plant and equipment through LGP panels. The probity is all looked after, all of that is covered. And it is simple. You couldn’t get a better system really”.
Kevin Mandell (on the right) congratulating City of Canada Bay's Fleet Manager, Peter Blair, who was receiving their 100th vehicle (a Subaru Outback) purchased via VendorPanel since June 2014. They are currently up to a total of 115 vehicles purchased via VendorPanel.
To find out more email VendorPanel or contact your LGP Business Development Manager.
What's Happening With LGP Approved Contractors?
LGP406-3 Advertising Agency Services
