Editor’s Corner article

Procurement Deconstructed
CHRIS MacLEAN  |  Mar 22, 2017

Procurement can’t be any less complicated, I’ve been told, because there are so many opportunities for corruption, so many levels of approvals, a multi-faceted, repeatedly mended and growing web of process, and no leader. Risk has been deemed unacceptable, and a lot of effort goes into protecting each of the many careers potentially on the line if a decision is ever made. In what must be some sort of “inside joke” the rest of us don’t understand, the government likes to describe defence procurement as “transparent.” In fact, the only thing that is absolutely crystal clear, ironically, is the lack of transparency in the whole process. 

Accountability. Anyone who has ever been in a position of responsibility knows the main component of efficiency is to have a single point of accountability. We’ve all heard the term “the buck stops here,” which is a curiously reassuring statement that has probably not been heard in the halls of the Government of Canada for at least a decade.

The Risk Aversion piece is a result of typically myopic legal advice, and I get that, but we must remember that only those who risk something will ever attain greatness.

Canada’s defence procurement system has so muddled the playing field that there are entire teams working conflicting agendas while demanding an equal voice in any decisions. 

Every decision is made by committee (when they can get together), so no one can be held accountable, no one can be blamed, no one person is responsible. Delays have few if any repercussions for a government worker, however, the bidders are losing money (which will get passed to taxpayers somehow) and may also lose the support of their Board.

There are many explanations as to how this system evolved. Some point the omnipresent risk of corruption. There is no denying that numerous projects over the years have turned into “directed” RFPs, it is fairly easy to accomplish, however, this unethical tactic causes companies to spend huge sums, sometimes millions, to compete in good faith for a contract for which they may never have been given a fair chance. 

What can be done? The only thing that can be done is to strip it back. Hire people with intimate knowledge of the way military works, people with some knowledge of what is being assessed, what it needs to be able to do, how it operates, and how it fits into the big picture required by the commander. And here is the kicker. Give each the authority to make defendable decisions (make each decision require a page of explanation if you want). 

Monitor progress, reward diligence (but not stalling), and track where the stumbling blocks are with a view to addressing the issue and advancing the project along realistic timelines. Identify a requirement based on an operational need (“must be able to...” rather than “must use XX weapons”). Take care to keep mandatories to a bare minimum (adding a wish list if appropriate). A complete list of existing interoperability requirements should also be included, but not made mandatory. Why not? A bidder may know of something that will do the job better, faster, cheaper than you currently use, so why stipulate a lack of innovation? 

Provide a budget, a deadline, and sit back. Allow the bidders some room for imagination. Allow them to provide their best proposal to fulfill the operational requirement (best pricing, best technologies, best timelines, best ITB and value propositions) – they should not have to spend millions of hours developing a bid. Done.

A committee of stakeholders will examine the proposals, separately rate each solution and value prop (with reasoning that can be explained and defended), the Commander’s team will then make a recommendation based on operational needs, and the Commander will take the entire matrix into consideration and make a final, also defendable, decision. Done.

Think of it like buying a new car. A dealer can’t sue you for choosing the blue mustang with xyz options over the black camaro with abc options. 

As long as they both accomplish the stated requirement (getting from point A to point B and can hold all of your hockey gear in the trunk), both are at or under the budget price, and can be delivered within the required timeline – just make a choice and get on with it. Maybe the two cars are equally appealing, but the mustang has a sun roof and the dealer regularly holds food drives and will donate to a charity of your choice. Done. 

If a company hasn’t wasted millions preparing for what it feels is a rigged competition, it will accept that the military can choose the overall solution it prefers, with legitimate reasons, from a selection of possibly wildly different options, as long as all are compliant. 
I could work out more details, but I’d need more space. 

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