4 Quick Fixes for the Procurement Dragon

Yes we can!

Almost everyone who deals with government – internally or externally – is frustrated by the “procurement dragon”.  Procurement seem to take forever and are one of the most bureaucracy-laced processes in all of governing.   In these days of innovation and the flourishing of the startup culture, procurement processes seem to be an anachronistic throwback.

Furthermore, the convoluted purchasing process only seems to benefit large corporations who have the legions of attorneys and technical staff to respond to RFPs and negotiate the maze.

Purchasing practice is steeped in a web of local and state laws, regulations and executive orders, so they’re not easy to change.   There are good reasons for the present procurement practices, and I’ll mention those at the end of this post.   But first, can innovation and a culture of agile government survive in the present purchasing jungle?

I suggest four quick fixes, some of which are already in place in many governments:

1. Direct Purchase.   This is a direct purchasing mechanism for small procurements – say procurements under $5000.   This would allow a department director or senior manager to directly purchase a good or service from a company without going through more formal purchasing processes.   A manager might purchase a smartphone app and associated database for use by field crews, or a couple of tablet computers for testing.  There still need to be limits on this mechanism, so I’m not issuing 20 direct purchases to the same company in a year, for example, and to make sure the vendor has a valid business license.
2. Roster and invitation to bid.   With this mechanism, companies would be pre-qualified and put on a roster for bids.   A city, for example, might set up a roster for “web applications”.  Companies who want to be on that roster would provide a minimal amount of information – ownership, business address, business license, etc.   And when the city needs a “web application” for a specific purpose, e.g. to accept photos of graffiti from citizens, it could issue a simple, two-or-three page  “invitation to bid” with its requirements and allow companies on the roster to bid.  Typically these bids would also be restricted to procurements of a certain size, say $50,000.
3. Piggy-back on an existing contract.   This mechanism is already widely used.   If a company already has a contract on the Federal Government’s GSA (General Services Administration) schedule, or the Western States’ Contracting Alliance  (WSCA – commonly called “wisca”), any jurisdiction which joins the alliance and authorizes itself to purchase can purchase at the terms and conditions specified by GSA or WSCA.
4. Credit card.   Most government agencies give their trusted department directors and senior employees credit cards.   These are most often used for travel and similar expenses, but they certainly could be used (depending on local ordinance or law) for small purchases, again, up to a limit of, say, several thousand dollars.
5. Budget.   As an adjunct to these four mechanisms, a city, county or department also needs budget to make the procurement.  Perhaps every department or government should have an “innovation fund”.

Using mechanisms like these, governments could quickly and easily procure innovative technologies, goods and services to help them become more efficient and effective.

Implementing these mechanisms requires a great deal of trust – trust by elected officials in their department directors, and trust by those department directors in their senior managers.    There are many cases where that trust has been abused, for example, by a manager purchasing good/services from friends or by making procurements and receiving kickbacks.  Examples include the controversy which engulfed recently appointed federal CIO Vivek Kundra in 2009, or these Seattle Public Utilities customer service representatives in 2012.  So my “quick fixes” for procurment also require diligent oversight and auditing by the appropriate authorities.

Finally, the present procurement practices in most jurisdictions are not the results of “bureaucrats run wild” with regulations, forms and requirements.   They came into being because of widespread abuse of purchasing in the 19^th Century, where Mayors and other elected officials gave jobs to friends, contracts to cronies and similarly greased their own pockets using the procurement process.

“Good government” advocates instituted reforms such as civil service to protect most employees from the winds of politics, and purchasing laws which required specifications and open competition.   These practices still should be followed for major procurements to keep a “level playing field” for competition for the work.

Over the years, however, city councils and legislatures and county commissions have added twists and turns to procurement, largely to correct past injustices or for social engineering.  Do contracts go to firms owned by white men?  Then let’s add a provision for subcontracts to historically underused businesses (HUBs) – women and minority-owned business.   Are we angered by human rights abuses in ______ (fill in the blank, e.g. Burma, Iran, China, etc.)?  Then let’s add a regulation so we don’t  do any business with a company with business interests or a manufacturing plant in those places.   Are we upset that some companies pollute the air and water with their factories or other facilities?  Then let’s eliminate them from bidding on contracts (or have our pension funds divest themselves of the company’s stock).  Do we want to encourage economic development in our City (county, State, or even the entire United States)?   Then let’s add regulations to give preference to firms headquartered or with operations in those places.

I’m not saying these practices are wrong and should all be eliminated.   I’m pointing out that there are reasons the purchasing process is so complicated, and it will take a lot of thought and careful consideration to “unwind the maze”.

In the meantime, let’s implement the “quick fixes”.

– No More Car Collisions or Speeding Tickets

Seattle Car Accident courtesy Univ Of Washington

A long, long time ago in a galaxy – well, actually, a City – far away, I was a police officer – a street cop.  I witnessed some of the most horrific episodes of my life as I came upon scenes of automobile collisions with gruesome injuries.   I also wrote my share of speeding tickets (and NO, I did NOT have a quota!) and arrested a fair number of drunk drivers.

New technology, however, heralds the potential for an end to automobile collisions, speeding tickets, drunk driving and even most traffic management.   Gee, there’s even the possibility that the traffic jam may be relegated to the dustbin of history (along with the dustbin itself, I might add).

A combination of technologies is maturing which foretells such a future.

Google Driverless Car

The first one, of course, is the driverless car.   Google has been at the forefront of prototyping that vehicle, to the point where California and Nevada have both passed laws explicitly allowing such vehicles on their roads.   Beyond Google, most of the major automobile manufacturers are also testing driverless vehicles.   And it’s only a matter of time before such vehicles are regularly driving our roads.

Next, we are seeing the appearance of the “vehicle area network” and “networked vehicles”.

I just purchased a new 2013 Toyota Prius C (and then promptly crashed it in a minor accident – subject matter for a different blog post).  When I plugged my iPhone into the Prius to charge it, the Prius recognized the iPhone and linked to it, and offered the ability to use the iPhone’s cellular connection to link the Prius’ own touchscreen display, maps and apps to the wider world.   Toyota also has an “entune” app for this purpose.

We’ll see much more of this in the future – where cars are linked to the Internet.  BMW already connects most of its vehicles worldwide to collect performance data via Teleservices.   GM’s Onstar has been around for a number of years.    Insurance companies are starting to offer discounts for good drivers who consent to put a monitoring device in their vehicle to sense sudden starts and stops, speeding, and other actions which may be dangerous (or at least insurance companies think are dangerous).

Future vehicles will have networks which link the vehicle to all your personal devices – keys, smart phone, tablets, DVD players and more, to keep you “connected” and in control on the highway.

Furthermore, cars will talk to each other.  They could exchange location information, proximity information, directional information and much more.   In this fashion cars might be able to avoid each other or allow for smooth lane changes and turns without colliding.

A related development is the instrumentation of the highway.

Seattle Traffic Management Center

I had the privilege of working with the Seattle Transportation Department, which was at the forefront of intelligent transportation systems (ITS), when I was City CTO there.   Today ITS means, for the most part, traffic sensing and detection devices to time traffic signals, extensive networks of traffic cameras linked with fiber cable, readerboards on streets, and some novel technologies like traffic time estimators and displays.   Mobile apps are all the rage, of course, to display traffic conditions.   Seattle just launched an amazing mobile app which actually shows live video from traffic cams on your smartphone.

Indeed, the City of Los Angeles just became the first major City worldwide to automate all  of its 4,500 traffic signals, synchronizing them.   That will reduce travel times somewhat, although our experience with expansion of capacity (e.g. building new freeways or widening them) is just that more traffic is generated.

But sensors and instrumentation can be taken a step further.

Almost everything in the roadway could, of course, be instrumented – sensors in guard rails, school crosswalks, stop signs, bridges.   Such sensors might not only collect information but also broadcast it to traffic management centers or, indeed, nearby vehicles.

Your car would know when you are approaching a stop sign and automagically apply the brakes – gee, the “California stop” might become thing of the past.   As you approached a school zone during school hours, your car would automatically slow to no faster than the allowable speed.   Radars or sensors in the vehicle would detect the presence of children and stop for them – indeed, if every child was somehow sensor-equipped, they might never be struck by cars whose intelligent management systems would automatically avoid them.  (And no, I am NOT going to discuss the potential for placing microchips in human beings, although some sort of sensor attached as a smart phone or bracelet or watch DOES have its advantages!)

And you can see where this is leading – as cars become more “intelligent” with their own networks and sensors, and roads become more “intelligent” with their own sensors, networks and computers, the need for human drivers may become irrelevant.

• You could put your 3 year old alone in a vehicle, tell it to take her to daycare, and have it drop her off there and return home.
• Drunks (or their Washington-State modern day equivalents:  pot smokers) could stumble into their cars and the vehicle would quickly and efficiently woosh them home – or to the detox ward, as the case may be, with almost zero chance of that drunk killing or maiming someone.
• With driverless cars, even the need for taxicab drivers might be eliminated – you’d use your smartphone to call a taxi and it would smoothly come to the curb;

Speeding tickets, collisions, accident investigations, even automobile deaths might become history.

This, of course, has many implications for local and state governments:

• Cops would no longer “work traffic”, investigate accidents or write tickets – they’d concentrate on investigating and preventing non-traffic crimes;
• There could be a new set of government regulations requiring regular maintenance of vehicles and government inspections of them, because the only major source of collisions would be mechanical failure;
• Emergency rooms and morgues would not be treating traumas and death from car collisions;
• A significant source of revenue for local governments (traffic tickets) would dry up, although they could respond by increasing parking rates or licensing fees;
• As emergency vehicles speed to fires or crimes, traffic would autmagically stop and pull over  – somewhat like the parting of the Red Sea – reducing response times for police and fire.
• Lawyers and courts would be freed (or put out of a job) litigating traffic accidents and court cases (see my blog post here explaining why most lawyers will be become history anyway);
• Auto insurance rates would drop steeply, and, again, put a lot of people out of work adjusting claims, fixing cars, etc.;
• Indeed, traffic might actually move faster and more efficiently through cities because the need for traffic lights and synchronization might end as vehicles negotiate with each other to speed along roads and through intersections.    However traffic signals would not go away in many places, because pedestrians still need to cross streets;
• Transportation departments would probably spend less time building new roads and widening existing ones, but high quality roads would be essential to prevent damage to vehicles driving at higher speeds.
• Many delivery jobs might be gone.  Perhaps mailboxes would move to the curb (if not there already) and driverless Postal Service, UPS, FedEx and similar vehicles with robotic arms would just deposit most mail and packages in the box.  This is a logical extension to today’s robot-filled Amazon warehouses.   Of course how people are able to buy anything to be delivered, given all the job losses, is a separate issue!

I don’t expect to see this traffic “nirvana” anytime soon. But I clearly see it on the horizon. Yes, there will be a lot of disruption and both loss of jobs and creation of new, unknown ones.

But I welcome the day when grandparents are not killed and ripped from their families by drunk drivers. I hope to see over 36,000 Americans saved from needless death and 3.9 million from injury at the hands of automobiles and their drivers.