Every state aspires to have “modern” information technology. Each year, the National Association of State Chief Information Officers (NASCIO) surveys state chief information officers (CIOs) on strategies, opportunities and issues affecting state information technology (IT). In the 2015 survey, The Value Equation, NASCIO surveyed CIOs on their quest to achieve modern state IT procurement processes. The results told us that roughly one-half (47%) of state CIOs exhibit negative outlooks on IT procurement processes.
Frustration and dissatisfaction with the state IT procurement process is not new and neither is NASCIO’s advocacy. In 2004, during my first year as Executive Director, NASCIO released a recommendation for states to remove unlimited liability provisions from procurement law. And this topic has been one we have discussed consistently in the years since.
Indeed, as in 2015, in the 2010, 2012 and 2013 survey results, roughly half of state CIOs exhibited negative outlooks on procurement. This trend is even more telling because, since 2012, all but eleven states have experienced CIO transitions. Specific state CIOs are changing, but the dissatisfaction level with the IT procurement process remains the same.
Additionally, NASCIO recently surveyed our corporate partners and 70% are moderately to very dissatisfied with the state IT procurement process. One corporate partner responded, “disorganized, inconsistent processes, governance and standards across agencies even with a supposedly centralized procurement function,” continue to plague the state IT procurement process. One thing is clear – the evidence for reform is compelling.
The call for reform gets even louder when considering that time consuming and outdated procurement processes can cause disruption of services for states and the citizens they serve. As states move to modern solutions such as cloud services, managed services and agile development, IT procurement must adapt and respond to these forces of change. This is why NASCIO is advocating for state IT procurement reform by issuing a call to action to states.
NASCIO believes that there are five actions states can take to improve the IT procurement process:
- Remove unlimited liability clauses in state terms and conditions
As of 2016, 36 states have eliminated unlimited liability (www.nascio.org/LOL)
- Introduce more flexible terms and conditions
As technology options continue to evolve, states must adopt flexible and agile terms and conditions (see Center for Digital Government’s Best Practice Guide for Cloud and As-A-Service Procurements)
- Don’t require performance bonds from vendors
In order for states to lower costs and create a competitive procurement pool, states need to consider finding ways of leveraging existing protections and adjusting performance bond requirements if necessary (see NASCIO publication Leaving Performance Bonds at the Door)
- Leverage enterprise architecture for improved IT procurement
The procurement process should be adjusted to recognize and align with enterprise IT strategies, architecture and standards based acquisitions (see NASCIO publication Leveraging Enterprise Architecture for Improved IT Procurement)
- Improve the Negotiations Process
Implement rules for using competitive negotiations to facilitate “give-and-take” between buyer and seller (see IJIS Institute report Strategies for Procurement Innovation and Reform)
True state IT procurement reform will not happen overnight and NASCIO’s five recommendations will not completely fix the problem. Understanding these forces and collaboration are critical to success. State CIOs must work together with their governors, state legislators, chief procurement officials and private sector partners to reform the process in their state. Because, in the end, if something doesn’t improve, states will never be able to achieve their vision of digital government and enjoy cost savings, efficiencies and transformation of service for the citizens they serve.
For more information, please visit www.nascio.org/procurement