A reform of public procurement shapes the internal organisation of the public procurement unit and the issue of allocation of authority.
Purchasing and Supply with Nyasha Chizu
Internal organisation of public procurement refers to the functions, structure and staffing of the unit.
Allocation of authority refers to the level of centralisation or decentralisation of procurement decision making that shapes the level of delegation of authority and the level of aggregation of requirements.
Level of delegation refers to level of control and approval of procurement decisions.
The envisaged function of a reformed public procurement unit answers such questions as what the procurement unit do does.
Whether the function is clerical or strategic where a clerical function is merely process oriented responsible for converting requisitions into purchase orders or strategic where the role is for aligning procurement process with organisational strategic plan to achieve cost management as well as effective service delivery.
There are critical steps to consider and how those steps are organised to distinguish a clerical and strategic unit. This would include how planning and co-ordination of value for money procurement is going to be achieved.
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Structure of the reform refers to the decision making process in public procurement.
It extends further to the allocation of responsibilities of procurement related activities with respect to who makes the procurement decision.
A reform would address issues of staffing in the procurement unit. Staffing generally refers to issues of professionalism, regulation and expertise of procurement personnel.
The key to quality public procurement is professionalism. Professionalism is the competence or skills expected of procurement staff.
This would entail a different paradigm of the employment process of procurement cadres to employ relevant procurement qualifications and skills. This is against the fact that expert administrators are not effective procurement cadres.
Another critical element to harness professionalism is self-regulation recognised by local laws.
Self regulation refers to the organisations of professionals that include adoption of a code of conduct that enhance ethical behaviour and definition of minimum attributes for an individual to hold a particular office of influence and the adoption of a license to practice.
The practice of self regulation is not novel locally and internationally and most professionals in Zimbabwe are regulated the same way.
The element of whether the decision making process of a country is centralised or decentralised refers to that authority to make a procurement decision in a country.
Authority is linked to controls and approvals. The more processes are involved in procurement decision making, the less efficient the system, the more vulnerable to corruption the system becomes.
The other element on organising the procurement function refers to the level of aggregation of requirements.
Sectors such as utilities, local government and the health sector have common use items and services that would benefit from economies of scale and improvement of quality of service by mere aggregation of requirements.
On the other hand, procurement function organisation can be ‘process’ or ‘outcome’ oriented. Traditionally, the view taken of procurement has determined the method of implementation.
Process considerations tend to lead to centralised procurement and outcomes considerations tend to lead to decentralised procurement. There is however an in-between approach adopted by development partners that embrace the outcome approach by delegating decision making to procuring entities while the process considerations are taken care of by somewhat ‘real-time’ audit by the review body.
The organisation of procurement function is critical since is the watershed of what public procurement shall be and what it can achieve after the reforms. A detailed analysis of what ‘process’ or ‘outcome’ based approaches achieve shall then follow.
Nyasha Chizu is a Fellow of the Chartered Institute of Purchasing and Supply writing in his personal capacity. Feedback: [email protected]; Skype: nyasha.chizu