Foundations for Intelligent Automation of the Contracting Process

Posted by on Oct 29, 2010 | Comments Off on Foundations for Intelligent Automation of the Contracting Process

Back in the late nineties when I first embarked on designing an intelligent procurement system which leveraged advanced algorithms to effectively engage and select the best possible suppliers within a matter of seconds, the core principle of my approach was that it had to have a solid basis in a manual system in which there was inherent process efficiencies.  In short, if the manual framework did not make sense, then there was no point in automating the process – a kind of garbage in, garbage out mindset.

Focusing on Indirect Material Spend, and in particular Maintenance, Repair and Operations “MRO” products, we ultimately introduced a production system into the Department of National Defence that saved the “DND” significant sums of money over a 7 year period.

However, extending the same framework to more complicated acquisitions calls for a major adjustment which takes into account the diverse variables associated with the negotiation process.  For this reason, the Strategic Relationship Negotiation Methodology or Process “SRNP” created by Strategic Relationships Sourcing Inc. “SRS” is an important document in that it serves as the blueprint for transforming complex procurement automation from a static library of contractual legal terms to a practical application of best value parameters based on real-life, expert purchasing experience.

Developed several years ago, the SRNP was structured around the negotiation of 6 complex real-world acquisitions which reflect both an actual and practical process.  This is an important point when you consider the words of the former CIO for the US Federal Government Karen Evans who, during a recent roundtable discussion, made the statement that “products” (re technology), does “not replace skill sets.”

Evans, who oversaw more than $70 billion in IT acquisitions by the US Government during her tenure added “vendors have to change their business models” focusing on the critical areas of “quality of service and reliability of data.”  The SNRP paper accomplishes this feat while laying a solid foundation for the automation of negotiating complex acquisitions.

You can review the paper in depth through this blog’s SlideShare Viewer below:

Please note that the PI Inquisitive Eye will be airing a special segment in late November reviewing the above paper including the practical application of the principles associated with the Strategic Relationship Negotiation Process.

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