More people weigh in on the question of governments funding suppliers . . .

Posted by on Feb 23, 2011 | Comments Off on More people weigh in on the question of governments funding suppliers . . .

As any blogger or social networking maven will tell you, comments from readers are sometimes far and few between depending on the topic being discussed. While I have certainly enjoyed the commentary feedback from as many as 50 plus people for a particular post or article – usually dealing with the lighter side of the business world, occasionally you strike a nerve relative to a more serious subject. Based on reader response so far, the suggestion that governments help to offset the onerous costs for suppliers (especially SMEs), to respond to bids through supply chain financing is such a subject. Out the growing number of impassioned responses I have received to date, the following from Stephanie Drilling, PMP, Six Sigma Consultant presents a very well balanced viewpoint that is actually based on experience versus opinion. Have a read, and tell me what you think? As a small disadvantaged, woman owned, veteran owned business I also DO NOT believe the government should finance the entry of small business into government contracting. However, I do believe there should be better procurement rules to protect the process. I cannot tell you how many times we have come across a perfect opportunity where the opportunity included: • Proposals released on FBO on Thursday at 4:00 p.m. with a proposal due date of Friday at noon. • Statement of works written to write in favor of the incumbent • Sole source justifications released without a real faith effort of the contracting agency to offer an opportunity to other firms that are eligible. • The government agency using the procurement mechanism as a tool to obtain design and implementation strategy information to complete a project in house. • The government agency sharing information with the favored applicant About a year ago we provided a proposal for a homeland security project. The project was for a fixed price project with a ceiling. The RFP required detail cost estimates, detailed implementation plans, Gantt charts, budget worksheets in several flavors, a listing of every piece of equipment and supply item including from whom the item would be purchased, detailed risk analysis, step by step technical approach and screen prints for a piece of software that would be included. Our firm spent about 1200 hours working on this proposal Not only did our firm have 100% of the experience and skills to complete the statement of work, we also had the #1 expert in the field who literally wrote the book on the topic. At the end of the day the government agency rejected all of the proposals from all of the vendors and stated they had decided to do the project in house. Our guess is this was their strategy all along and the procurement mechanism was used to jump start their research. In another case we caught a government agency providing information to a favored vendor during the proposal process. When that vendor was awarded the project we protested and won. Did we ultimately get the project – no. The government agency then turned around and re-wrote the statement of work in such a way as to exclude our firm from participating. Thus, what we would like to see is a procurement mechanism offering a fair percentage of opportunities to small businesses and which includes necessary measures and protections to ensure integrity in the process. Personally speaking, and as I had indicated in yesterday’s post, While I doubt that there will ever be a consensus on supply chain financing in the public sector, it is safe to say that there are a myriad of things that need to happen before we actually have a transparent procurement process that delivers maximum value to the government and to taxpayers. Lessening supplier reliance on private financing through banks is one of many important first steps.

What Stephanie’s response serves to remind us is that supply chain finance is not the only step, but one in a potentially lengthy process that includes greater transparency in public sector procurement. Thank you, Stephanie. 30
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