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Ask the GovExpert: Can I Get a Side of Value With That?

This week’s interview comes from Marcheta E. Gillespie, CPPO,CPPB,C.P.M.,CPM. As if all of those certifications weren’t enough, Marcheta is the Deputy Director for the City of Tucson’s Department of Procurement. With over 18 years of experience in public procurement, Marcheta is a passionate advocate for her profession. Her areas of expertise include public procurement management, leadership, strategic planning, negotiations, contract administration, eProcurement, project management, cooperative programs and marketing.

Marcheta is the 3rd Vice President and Region XI Director on the NIGP Board of Directors, having joined the Board in 2007. She is the Vice Chair of the Finance Committee and has served as the Chair of the Guiding Principles Task Force and the National Forum Committee. Marcheta is also active in the NIGP Consulting program and has served as a leader for the Student Knowledge Community. A graduate of the University of Arizona, Marcheta has also been certified as a Franklin-Covey instructor, received her CPM from Arizona State University and became a certified instructor for NIGP in 2009.

With all of that experience, we wanted to know how bringing Procurement to the table could get us our side of VALUE!

1 – How do you define procurement? I define Procurement as the function within an organization that is responsible for the acquisition of goods and services needed for government to provide services to its community. Procurement is responsible for the strategic and operational management of that function, including working with all stakeholders to ensure the organizations’ needs are appropriately met.

2 – How is it different or similar at the State and Local level compared to the Federal level?

Each level of government operates under different sets of policies and regulations. Those who operate at the local level often have to contend with policies established based on, or related to more local concerns or issues (such as Small Business Enterprise programs and Living Wage programs). Individuals at the State and Federal level are often establishing contracts for a broad base of customers, for example, the State contracting on behalf of various state agencies and the Federal government contracting for various Federal agencies. Local government procurement focuses on the specific needs of their city, county, township, etc. Often, the Local government procurement operations have fewer layers of reviews and approvals (less “red tape”), fewer regulations to contend with and greater control over their process. At the Federal and State level, there is often an increased interaction with political leaders and dealing with political pressures. Not to suggest that Local procurement doesn’t interact with political representatives, just on a smaller scale and often with less pressure and direct influence.

3 – What are your biggest challenges? Currently, I believe the greatest challenges are how we manage the ever-growing and on-going resource reductions, while still trying to maintain the high level of customer service to our clients. Most procurement organizations I have talked with have had budget reductions and staff reductions, while a growing number are seeing decreases in their pay, furloughs and layoffs. This not only presents challenges to procurement leadership, in regards to maintaining their operations, but also how to take care of, and lead their staff during these difficult times. In addition, many have seen increased pressures from political leaders, who also are struggling with a reduction in organizational revenue, while dealing with the continued need for services from their communities. As such, organizations often see initiatives from political leaders that impact, both directly and indirectly, the function of procurement and the overall approach to acquisitions and contracting for the agency.

4 – How is new technology changing procurement for you? New technology means new ways of needing to do business while meeting the needs of our customers. For procurement, we must continue to improve our methods of delivering information and providing opportunities to our contractors and vendors. In a society increasingly accustomed to immediate access to vast amounts of information, not being able to provide the demanded access to our data and processes can be a challenge. It means we must find new ways to provide services to our stakeholder groups, whether that is enhancing services through on-line websites and procurement portals, or learning new ways of managing various solicitation processes.

For our customers, it means changes to the goods and services they acquire. This results in Procurement needing to understand how those changes affect the sourcing process, how they evaluate the goods and services and how they specify what they need for the organization. Often lacking the funding for new technology, Procurement must make the very best with what they are capable of doing, and find new ways of funding the technology that will help deliver the needed services.

5 –
What’s the best way to approach an agency as a small business?

Procurement, and the agencies they represent, should focus on finding effective ways of reaching out to all contractors and vendors, especially those who may struggle to understand how to do business with government. Small businesses often lack the resources and the experience to work the many processes, documents and network of people that is typical of government.

Procurement should consider providing training on vendor registration, simple Q&A for frequently asked questions, a “How To” manual on doing business with government, outreach events providing an open forum and dialogue with key agency staff, and various other outreach initiatives. One of Procurement’s most important roles is to reduce and/or remove the possible roadblocks to all businesses who want to and are able to engage in the competitive process. As such, Procurement should welcome inquiries from small business owners who want to know how they can participate in open competition and educate them on how they can better understand government processes, and how they can better prepare themselves and their companies to be successful in competitive processes. Reaching out to a procurement representative is often the best way to learn how to get started and learn the specifics of how an agency works with its contracting community.

6 – What’s one thing non-procurement govies should know about procurement?
Most definitely it is that procurement adds value to the agency! By ensuring that procurement has a “seat at the table” and is directly engaged in the strategic planning, and decision making processes of the leadership of the agency, procurement will be able to demonstrate direct organizational savings both in hard and soft dollars. Procurement has so much to offer, whether it is analyzing spend analysis, increasing efficiencies in processes and procedures, improving contract administration that results in savings, or reduction of the risks to an agency…the list goes on and on. The short answer — Procurement WILL improve the bottom line and will improve the agency’s ability to meet the needs of the community.

7 – What is the strangest thing that you have ever had to purchase/contract for? Not necessarily the strangest, but certainly unique; years ago I was responsible for establishing a contract for an aquarium in Tucson, AZ….the desert! Sadly, for various “non-procurement” related reasons, the project was terminated. However, it was one of the most fascinating projects I had the chance to work on, and the most complex.

Next to that, I would say my current project of providing procurement oversight for the Tucson Modern Day Streetcar Project is extremely challenging, complex and interesting. To be a part of this historical project is exciting and provides tremendous opportunity for Procurement to demonstrate our value to the organization.

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Profile Photo Candace Riddle

Question From Steve Zarro –

“Hi, Candace. Great post. As a procurement solutions consultant, i was curious if Marcheta mentioned any of the tools local governments on limited budgets are using to facilitate their needs. Thanks.”

Govies can you help Steve with an answer?

Profile Photo Candace Riddle

@Steve – Here is your answer from Marcheta.


I can speak to what the City of Tucson has done to address our own budget challenges. The City created a venue for the local community to share cost-saving and revenue-generating measures. These ideas were collected (hundreds of them) and then vetted through City staff for follow up on what is feasible/viable and what was not (with documentation of why it was not viable). Those ideas that are feasible/viable are then further analyzed for a decision to modify and/or implement. In addition, the City had developed an Expediture Oversight Team (EOT) and process that requires all requests for new purchases, renewals of contracts and contract amendments go through budget/finance review and approval by the City Manager and his staff for their necessity prior to Procurement proceeding with any acquisition or modification. During the course of the past 2 years, Procurement has also sent letters to all annual contract holders to request consideration of a reduction in the contract price. This effort has resulted in a number of occasions where contractors have willingly reduced their contract prices, as they recognize that a reduce price on a contract is better than the potential for a contract being terminated in its entirety due to the lack of funds to complete the service. On the revenue side of the equation, Tucson has been analyzing various revenue generating opportunities to further alleviate the organizational financial strain. Bottomline, it is best to consider a number of options and alternatives on how to solve the current challenges of our agencies, and there really is no option not worth at least considering.

Profile Photo Steve Zaro

Thank you both, Candace and Marcheta.

Tucson has clearly spent some time developing processes to support their procurement initiatives and been proactive both toward the public they are responsible to and suppliers that service them.

More specifically I am curious about the tools used to facilitate those processes. For example, Marchetta mentions, “Procurement has also sent letters to all annual contract holders to request consideration of a reduction in the contract price.” While this effort is very positive I wonder what the method was used to accomplish it. Procurement departments often spend large amounts on paper, printing, file management, etc. when there are software tools that can make communicating with all those suppliers a 1-2 click effort that include little or no paper or printing but support all the requirements for communicating the message.

Thanks again for any feedback.

Profile Photo Shelley Temkin

This is a great discussion. As a provider of innovative procurement solutions I’d like to acquaint you with what Green Proposals is doing to help make the procurement process more efficient and effective while contributing to sustainability, small business participation and transparency. Green Proposals facilitates pre-bid meetings via webinar at no cost to the buying agency. We charge interested businesses/vendors a nominal fee to “attend” a pre-bid meeting without the costs or concerns of time away from the office. Hard dollar expenditures are not the only concerns when attending a meeting in person but there’s also the expense of being out of the office for a considerable amount of time. So often small businesses are unable to participate in a “new business” opportunity because the “upfront” expenditure is too great of a sacrifice. Pre-bid meetings are important and can lead to important information and noteworthy partnerships amongst businesses that might not have been arranged otherwise. Green Proposals manages the entire pre-bid meeting process on behalf of the purchasing agency from beginning to end. There is no extra time or work required. Meeting registration generates an electronic sign in sheet that can be shared with all interested parties and a copy of the webinar is ready for distribution within hours of the meetings conclusion. Since everyone who attends receives a copy of the meeting there is a cut in the number of phone call and e-mails that often follow a pre-bid meeting. Our Green Meter that’s part of each webinar tracks the co2 emissions kept from the atmosphere as well as dollars saved by not having to leave the office. Our tracking mechanisms provide valuable information for organizations that are need to report on their achievements regarding community outreach, saving natural resources as well as working smarter. There’s absolutely no added work for the procurement department. Green Proposals facilitates the virtual pre-bid meeting from beginning to end.

Profile Photo Marcheta Gillespie

@ Steve – Very true Steve! Where possible, our communications are electronic. But, we do have some occasions where we are still “mailing” (pretty soon this word will resonate with the community like the word “record” resonates with our children). I expect to continue to see reductions in that, similar to when we eliminated thousands in printing and mailing costs in our vendor registration process, which was converted to a completely online process back in the late 90’s.

In general, I’m all for building the “toolbox” with as many solutions as I can gather from my colleagues in my profession (from around the country and even internationally) as well as my counterparts in other professions. I learn something new or get a new idea every day. Then I take something, tweek it to work for the City and off I go!

Profile Photo Steve Zaro
Thanks, Marcheta.
Did you develop your vendor registration in-house or buy a product? does your tool continue through the registration process to also provide bid notification and analysis?
I appreciate your time and replies!
Steve
Profile Photo Marcheta Gillespie

Steve, we use a product called BuySpeed from Periscope Holdings, Inc (based in Austin, TX). It is a full registration service that captures all the information on the vendor/contractor, including them selecting the NIGP code categories that applies to their area of business and/or the areas in which they want to be electronically notified when the City issues a solicitation. So long as they provide (and keep current) the email address, then the system will automatically notify them of when we have a solicitation published in that area. They then can connect to our website and view/download the documents. Although the product allows for receipt, analysis and award, we have not yet implemented that functionality for our formal (over our $50K bid threshhold) solicitations. Just a resource challenge right now….too many projects, too few folks. But, we have been using for some of our informals (quotes) and it works well for us. Hope that helps!

Profile Photo Steve Zaro

I am familiar with BuySpeed. Did some of your other product considerations include Coupa, eBid eXchange, or BidSync? The vendor/supplier registration and management software market is getting more and more crowded but also more popular — especially the Saas models in the cloud that give agencies a lot of flexibililty at a lower entry cost.

Thanks again, Marchetta for all your feedback.

Steve

Profile Photo Marcheta Gillespie

When we competed for our eProcurement system back in the late 90’s, there were approx 25 respondents. Interestingly enough, the majority of those respondent companies no longer exist. Such is the world of technology. I believe we did get a submittal by BidSync, but would have to research to be sure (remember, this is about 12 years ago and I can barely remember last week…ha!) I completely agree that this market has become popular recently…..it ebbs and flows. Years ago it peaked and then tappered off a bit. As government agencies have gone back and forth on ERP versus “best of breed”, the techno industry interests seem to follow suite. Fortunately, in comparison to what we have seen in costs for ERPs and even with other providers specializing in ePro, we believe we are paying a VERY favorable amount for the functionality we receive.

Anytime Steve! Always great to chat with a fellow govie!