Commissioning: Benefits of Market Engagement

04 December 2018 By Lesley Harper - Social Care Category Manager

Commissioning - Benefits of Market Engagement

Effective commissioning of health and social care services starts with having a sound understanding of the needs of service users, the outcomes you’re trying to achieve or the gap you’re trying to fill.

Undertaking needs assessments, researching ‘what works’ (and what doesn’t) and consultation exercises are key to this. Engaging with the providers should also be routinely undertaken as part of this process, yet it is often missed or done too late. The result? Commissioning the same old things, bids from the same providers and in the worst cases, failing to achieve value for money and/or to meet the outcomes you set out to achieve in the first place.

In procurement we call this “Early Supplier Involvement”, but I’m a commissioner at heart, so the term ‘Market Engagement’ sounds a lot nicer; but it’s essentially the same thing. It’s all about involving providers EARLY in the ‘analyse’ and ‘plan’ stages of the commissioning cycle.

Granted, not every commissioning project ends up in the procurement of an external service or product, but providers have a wealth of information that commissioners can tap into to aid their thinking and planning; finding out what’s possible, what works and what the market can offer that might not have been considered.

Fear of the procurement regulations is often one of the reasons why market engagement doesn’t happen. Despite being three years old, there is still concern amongst some commissioners (and procurement teams) that market engagement might be ‘breaching’ the procurement regulations; but this is far from the truth.  The Public Contracts Regulations 2015 have a specific section called ‘preliminary market consultation’. In other words, commissioners are encouraged to engage with the market with a view to helping to inform their plans and to make providers aware of these plans and the requirements, prior to the tender being published. Commissioners can (and should!) seek and accept advice from providers and can use this advice in the planning and conducting of the commissioning / procurement process. The only stipulation, of course, is that it doesn’t distort competition and is done in a non-discriminatory and transparent way.

So why undertake market engagement and why is it important to do it early?  Here’s a few reasons:

  • As a commissioner, you’ll benefit from provider knowledge of the market and trends. This will help to develop your understanding of the structure and capacity available in the local market to meet your requirements.

     

  • It gives providers the opportunity to highlight any possible effects of a proposed policy on the existing market, or to flag issues with a proposed contract / specification, so that you can respond appropriately. It’s better to know about these things early than have to deal with the consequences.

     

  • It can be helpful to discuss with providers how your requirements should be presented to make it attractive to providers and to test the feasibility of your idea with the market. Find out whether the market will be able to deliver what you’re wanting, or if there’s alternative ways of doing it. This can help to stimulate competition and innovation.

     

  • It may be possible to obtain some benchmark pricing structures from the market; it can be useful to have a ‘ballpark figure’ when doing your options appraisals and to help with setting (and justifying) an appropriate budget.

     

  • It gives providers a better understanding of your organisation and what it’s trying to achieve; this will ultimately help them to meet your needs when it comes to bidding. It also helps to build good relationships with providers, which is key to effective delivery in the long term.

     

  • Vitally, it gives providers the time to plan and prepare to respond to your tender and to be ready to meet your requirements. I’ve seen many tenders advertised in a last-minute rush because the current contract end date has ‘suddenly’ arrived. Providers also have a day-job, so giving them as much notice as possible is vital if you want to get good, well thought out, bids. This is especially true for small local businesses who are unlikely to have dedicated bid writers.

     

  • Ultimately early market engagement helps providers to write strong bids, which in turn results in your requirements and outcomes being well understood and met.

 

Having a range of established frameworks and Dynamic Purchasing Systems (DPSs) makes market engagement much easier and ‘safer’ for those who are still a bit cautious.  Providers will have already been selected and approved to be on the framework / DPS, so commissioners have a keen audience and wealth of knowledge just waiting to be accessed.

Categories: Care , Frameworks , Procurement

Comments

Michael Angel on 06 December 2018

Interesting blog. Agree with most of it. I would add for me, I don't think the fear around Market Engagement is from the buyer perspective as to whether it breaches the Public Contract Regulations. I feel it's more the Suppliers unwilling to be more open in an open playing field. In some cases from my own experience I have found Suppliers far later down the line suggesting that actually they would've preferred an RFI approach because it doesn't reveal much of their hand (not implying this being less transparent). The only other drawback I see is often with potential consortia bidders whereby a key service provider is not present at these events due to the lead provider attending and often how that communication and information is cascaded down or even lead providers and 2nd tier providers not seeing the opportunity to collaborate and does require the buyer to act as facilitator to get them on the same page (however such events make it tricky to do again as pointed out about the fair and transparent manner). More than not I have found Market Engagement Events not carried out effectively because the buyer doesn't fully understand the scope and takes the position they don't want to be 'supplier' led. Which is more down to the skill of the buyer. I would like to see more engagement with Suppliers beyond such events using an open platform whereby scoping and discussing service delivery models continue so a more rounded picture is painted :)

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