Measuring public procurement performance is no simple proposition. We find it useful to broadly reference examples of public procurement performance from public organizations, public procurement associations, and other leading thinkers on this topic. We at Public Spend Forum are also working with leaders, practitioners, and academics across the public sector in developing a public procurement performance and metrics framework that can be widely and flexibly adapted by public procurement functions.
In this “procurement perspectives” article, NASPO (National Association of State Procurement Officers) presents their broad based thinking around critical success areas and key performance indicators targeted for U.S. state central procurement offices. We believe the insights shared here are broadly applicable for the public sector.
Compare NASPO’s perspective on the topic with what you currently do in your organization and see if there are opportunities to leverage their thinking within your procurement function.
What are the key takeaways?
NASPO (National Association of State Procurement Officers) recently convened a Performance Measures Work Group that identified four critical success factors/areas and key indicators that the state central procurement organization should focus on to be successful – the work group identified 4 critical success areas:
Effective Management and Increased Efficiency of the Procurement Process
Create a Customer-Focused Enterprise – Contract Management and Supplier Performance
Increased Transparency, Openness and Accountability of the Procurement Processes
Increased Professionalism of the Procurement Workforce
For each of these critical success areas, NASPO has identified specific metrics to gauge how well the critical success area is being performed. Also included are definitions of the metrics along with actions to achieve success.
Note that as NASPO points out and we fully agree with this point that it may not be practical to identify exactly every metric that is suitable for all organizations. Clearly the exact metrics may vary but broad critical success areas (or practices) do need to be measured to develop a basic understanding of how well procurement functions are performing – as NASPO says:
“NASPO recognizes that it is not possible to create universal, ready-to-use KPIs that all 50 states
can use. However, NASPO suggests using the limited number of metrics defined under each critical success area as central to the successful performance of the state procurement organization. NASPO encourages each office to develop its own KPIs that are strategic actionable, relevant, and in line with statutory requirements, statewide strategy and the goals set for the individual central procurement office.”
Full Report: NASPO