The start of a new era in digital government procurement processes

Good morning everyone, and thank you for the invitation to speak at the Transforming Procurement Hack. It is inspiring that so many of you have committed your time and energy to this day.

Your contribution today will have an international impact on how governments reform their approach to procurement.

And it will have an impact here in New Zealand, where traditional government procurement processes have often put hurdles in the way of innovation.

My priorities

I have spoken extensively of my goal to ensure all New Zealanders are thriving in a digital world.

We are a Government that places people’s well-being at the heart of what we do.

We also aim to make ICT the second largest contributor to New Zealand’s Gross Domestic Product (GDP) by 2025.

For me, these priorities are interwoven. To close the digital divides, and ensure New Zealanders digital rights, we need a successful, innovative and growing ICT sector.

It’s one of the reasons why I’ve set in motion a number of initiatives, such as establishing the Digital Economy and Digital Inclusion Ministerial Advisory Group, or DEDIMAG.

The group includes of some of New Zealand’s best innovators and leading thinkers. They’re already advising Government on our objective to grow the digital economy, close the digital divides and how to utilise the levers of government more effectively.

We are also very close to announcing the first Chief Technology Officer (CTO) for New Zealand. 

The CTO will play a leading part in developing a digital strategy for New Zealand, including our approach to the digital economy.

Re-imagining Procurement

I want our ICT community to grow with New Zealand, to contribute to our democracy, and to continue being an enabler of greater social inclusion and better public services.

But if we want our start-ups to make it globally, and our innovators to have a positive impact, government must help the sector thrive.

That’s why we are taking a leadership position on a number of critical areas, including procurement.  We know that in a digital age, engagement with government should be easy to navigate, timely and straightforward.

New Zealand companies are already producing innovative solutions to help solve difficult government problems.

And government agencies want to access these solutions, and to work with suppliers to make them even better.

We also know supporting the local ICT industry with opportunities from government will allow them to make significant new investments, and adopt innovative business models.

But it is clear procurement barriers exist between suppliers and government, especially new, smaller suppliers. I know we need to simplify our procurement processes and reduce agency silos. We need to look at whole-of-government solutions and consider government as a single customer.

And we need to ensure small and local suppliers can readily take advantage of this opportunity. 

We need to transform government procurement for a digital age.

Marketplace

That’s why I’m delighted to be able to tell today about ‘Marketplace’ – the start of a new era in digital government procurement processes.

It’s an example of transformational thinking in action.

It’s a new government digital procurement channel, created with a co-design community drawn from across the sector.

This community, featuring suppliers, agencies, Government’s Procurement functional lead MBIE and others, have committed their time, feedback and expertise.

I see this as a really important endorsement for our approach. We have witnessed the community’s support in other areas.

Earlier this year over 230 suppliers requested information on the Beta test programme.

Of the 29 that were selected for Beta testing, over 90% were small New Zealand enterprises. 

Thanks to the support of the co-design community, Marketplace has been designed to dramatically reduce barriers for suppliers engaging with government – and make procurement easier for agencies.

It’s open to all suppliers who meet the entry criteria – no current contract with government is needed.

Suppliers and agencies can sign up to use the service when they are ready to do so – not when the government’s calendar says it’s time.

It has simple commercial terms – a single set to cover all government customers.  We know this is important – one of our test suppliers told us they currently have over 50 individual contracts with various agencies – a frustrating and costly overhead.

The Marketplace website will be visible to anyone who wants to see it, exposing New Zealand capability locally and internationally.

Marketplace has the potential to transform how government can work as a ‘single customer’, making it even easier and faster to connect agency needs with industry innovation.

And at the same time, Marketplace establishes a government procurement data source to better inform stakeholders. 

Marketplace should be a lot easier and quicker to use than current systems. Taking process cost and time out of the system for all, supporting the reuse of capability and fostering collaboration across government.

Marketplace is just one piece of the puzzle.  To drive digital transformation and create an open government, we are taking a leadership position across the whole area of ICT procurement.

It’s part of an ongoing effort to change how we work together – It’s my intention that this will be a true co-design process and I want to know if you think it’s not. There can be a bit of pain in making that truly work but the more we try, and the more examples we’ve got, the easier it’s going to become for everyone.

We recognise the need to make it easier for firms to work with government which is after all the largest buyer of ICT in New Zealand.

Together we can change procurement into a much more of a flexible, agile process taking advantage of what digital platforms can offer.

So what happens next for Marketplace?

The potential is there to expand what the platform can do, who can be involved and the types of services it offers.

Imagine allowing these suppliers to respond directly to an Agency’s problem statement, or supporting agencies to list and transfer surplus licences.

And what if we could offer a platform for professional services, or integration.

I’m keen to hear from you about what types of services, and what types of functions would you add to the Marketplace? 

Over the coming months, with your help, we will shape and evolve the roadmap for our digital channel. 

Our focus must be on the areas that will most benefit all New Zealanders.  And then we must make it straightforward for suppliers to offer those services.

Closing

I’d like to thank the Department of Internal Affairs for bringing us together for this day.

I see great potential for New Zealand in moving to an open Marketplace model; it is a game-changer. The rest of the world is watching with interest.

Let’s show them how we can do it.