The UK Government has clear expectations for how contracting authorities and suppliers should engage with each other, and has published guidance for these relationships in The Sourcing Playbook and The Consultancy Playbook – which have been published alongside each other. In this post you will find a summary of the key information contained within both.
The guidance contained within each Playbook is aimed at Central Government but should be considered as ‘good practice’ by the wider public sector. As a supplier, we recommend you familiarise yourself with the guidance referenced, and use it to support future bids.
If you are a supplier within the Construction industry, you may wish to review the more specific policies covered within The Construction Playbook.
The Sourcing Playbook
The Sourcing Playbook contains guidance on outsourcing, insourcing, mixed economy sourcing and contracting, and aims to deliver the following:
◆ Getting more projects right from the start
◆ Development of robust procurement strategies
◆ Engagement with healthy markets
◆ Contract with suppliers that want to work with the public sector
◆ Be prepared for when things go wrong
To achieve these outcomes, The Sourcing Playbook provides 11 key policies that all central departments are expected to follow.
The Sourcing Playbook’s 11 Key Policies
- Commercial pipelines
The government will ensure the market is aware of all upcoming projects and publish pipelines for next 18 months as a minimum, with the aim of sharing plans for the next 3-5 years. This gives suppliers plenty of time to engage with buyers, understand demand and arrange joint bids before contracts have been published.
- Market health and capability assessments
They will work to design strategies and contracts that help to maintain a healthy market – by addressing barriers to entry, taking advantage of innovations, and promoting competition.
This is good for suppliers as it means more focus will be placed on creating and simplifying access to the market.
- Project Validation Review (PVR)
New initiatives that are likely to lead to major projects, shall go through a PVR. This also now applies to all complex outsourcing projects. It consists of independent peer reviews early within the project lifecycle, and ensures experts have the opportunity to assess, discuss, and challenge proposed strategies.
This could provide suppliers with opportunities to engage with buyers and help shape what the final strategy will look like.
- Delivery Model Assessments (DMA)
The use of DMAs is seen as good practice, and ensure contracting authorities use evidence-based processes to determine the best delivery model for projects.
These assessments will offer suppliers further pre-engagement opportunities with buyers before contracts get published.
- Should Cost Models
The use of Should Cost Models (SCM) will be used to forecast whole life costs and risks of proposed projects.
The use of SCM should prevent ‘low-cost bid bias’ and help ensure the most thorough and well-planned bids achieve the best scores.
- Requirement for pilots
Where contracting authorities are outsourcing a service for the first time, a pilot should be run as part of a thorough programme of testing before deciding on a long-term delivery model.
Testing is a significant factor for the public sector, and suppliers should be aware that this could be requested.
- Key Performance Indicators (KPIs)
New projects should include KPIs that are both relevant and proportionate to the size and complexity of the contract.
By introducing KPIs, the public sector plans to work closer with suppliers to ensure expectations are detailed with greater clarity and to prevent misunderstandings – making it easier for suppliers to create accurate proposals.
- Risk allocation
By working with suppliers at an early stage, risks should be addressed and have solutions developed to mitigate these before publishing contracts. Risk allocation then determines which parties will assume each risk.
- Pricing and payment mechanisms
Working to establish the best pricing based on delivery of outputs, work value or supplier performance. Pricing should reflect the level of certainty or risk around the scope and requirement.
- Assessing the economic and financial standing of suppliers
The economic and financial standing of suppliers will come into consideration to safeguard the delivery of projects. These assessments will form part of their risk management activities and be tailored to each specific project – with the aim of being proportionate, fair and not overly risk averse.
- Resolution planning
Focuses on mitigating the impact of insolvency of projects. While major insolvency is rare, this is now part of their risk management, and suppliers of critical public service contracts shall be obliged by their contracts to provide resolution planning information.
Insolvency will be considered as a risk when reviewing supplier business continuity and disaster recovery (BCDR) and exit plans.
The Consultancy Playbook
The Consultancy Playbook was published alongside The Sourcing Playbook to offer further guidance to help contracting authorities commission and engage with consultants more effectively, achieve better outcomes, get better value for money and improve the transfer of knowledge and skills.
The outcomes identified are:
◆ understand when consultants can add the most value
◆ when necessary, set our procurements up for success
◆ achieve more favourable outcomes when going to market
◆ be a more effective client of consultants while building meaningful relationships with our suppliers
◆ improve Civil Service capability by maximising knowledge generation and transfer across the contract lifecycle
While there are no new policies for consultancy services, there is a lot of useful information in The Consultancy Playbook about the considerations contracting authorities need to make, and what they should look for.
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