Presentation to QUESTnet 2014 on Collaborative Procurement

1. Collaborative Procurement
Mark Noonan
Manager, IT
Procurement, QUT

2. Some Definitions
• Simplistically, it can be the collaborative purchase by several
entities of commonly used goods or services.
• Collaborative procurement is about achieving value for money
through building partnerships between buying institutions and
suppliers. By drawing on expertise, skills and knowledge in
procurement to leverage combined needs and secure benefits
from economies of scale through harnessing sector wide
purchasing power.
• Collaborative procurement is when two or more groups of
people, or organisations, engaged in procurement, work together
for mutual benefit.1
1 Cram C. Two Heads: Always Better Than One, Government Opportunities, September 2003

3. Benefits
• Better terms and conditions for the sector
• Aggregated demand ensures competitive bids
• Reduction in labour costs – buyers & suppliers
• Reduction in legal risks and costs
• Standardization will aggregate demand
• Increased levels of collaboration
• Improved logistics

4. Advantages & Disadvantages
• Economies of scale
• Stronger negotiation
position
• Initial set-up overheads
• On-going commitment
• Reduction in flexibility
• LOSS of control
• Supplier resistance
• Longer timelines

5. Success Factors
• Basic rules and operating principles
• Participation is optional but encouraged through
cooperation and communication
• Common objectives and mission
• Remove the demographic problems and organisation
size limitations

6. Objectives
• Competitive/improved procurement opportunities and
efficiencies
• Buying smarter
• Use best practice methodology
• Vendor management – remove the divide and conquer
mentality – Win/win
• Share the load and the skills/knowledge

7. Discussion Topics
• How to build a team of trusted colleagues
– Similar goals
– Its their job and it helps to phone a friend
• Share the load
– Document
– Communicate
– Meet

8. Final Comment
Organisations of the future must be flexible and adaptable
and able to respond to change using new innovations and
collaborative techniques to achieve their strategic
objectives. – CIPS 2013
• http://www.rcc.gov.pt/SiteCollectionDocuments/ProcServe_Collaborative_Procur2010.pdf
• http://www.cips.org/Documents/Knowledge/Procurement-Topics-and-Skills/6-Efficiency/Collaborative-
Working/POP-Collaboration_Between_Organisations.pdf
• http://www.pprc.eu/wp-content/uploads/Collaborative-Procurement-A-Relational-View-of-
Buyer%E2%80%93Buyer-Relationships.pdf
• http://doc.utwente.nl/74069/1/choosing.pdf