Amplified probity risk

Cause 

Increased complexity due to the use of multi-stage procurement and more clarification is needed due to a more open-ended problem statement. 

What may happen

• The procurement team may become overwhelmed by the volume of supplier inquiries, leading to delays in responses and potential inconsistencies in the information provided.
• Suppliers may receive delayed or incomplete answers, causing frustration and potentially affecting the quality of their proposals.
• Suppliers may perceive the process as disorganised or unfair if they do not receive timely and accurate information, potentially leading to disengagement or withdrawal from the process. 

Impact on the objectives

• The quality of proposals received may be compromised due to delays or inconsistencies in communication, affecting the overall effectiveness of the procurement process and potentially leading to suboptimal solutions.
• The NSW Government's reputation for managing complex procurements effectively may be damaged, reducing trust and willingness among suppliers to participate in future tenders.
• Increased risk of formal complaints from suppliers regarding the fairness and transparency of the communication process, leading to potential legal challenges and additional costs for the NSW Government.
• The procurement project may experience delays and increased administrative burdens due to the need to manage a high volume of communications and resolve any resulting issues.
• The agency's risk appetite for innovation may be reduced if it faces the challenge of managing increased communication volume. 

Cause

Not effectively framing the scope or scale of the final opportunity.

What may happen

• Suppliers may choose not to put forward solutions if they feel the problem can't be solved by their solution or that the final opportunity is not worth investing their time in.
• Suppliers might discover later on that their solution could have solved the problem or that the opportunity was bigger than they had been led to believe. This could result in them feeling the process was not fair or transparent.

Impact on the objectives

• The buyer could miss out on high quality solutions or the latest technology, compromising value for money and future-proofing of the end solution.
• The NSW Government's reputation as customer of innovation may be damaged with one or more suppliers. This could be directly, or through word of mouth, resulting in further loss of high -quality solutions.
• A supplier could make a formal complaint, resulting in significant time and cost investment from government to defend it through formal processes
• The agency risk appetite could be reduced, affecting the ability to adopt innovation tactics in the future.

Cause

Over-representing the certainty of procurement stages proceeding or that budget will be available. 

What may happen

• Suppliers may invest significant time and resources in preparing their solutions based on the belief that the procurement will definitely proceed or that the budget is guaranteed, only to find out later that the procurement is delayed, altered or cancelled.
• Suppliers may become disillusioned or lose trust in the NSW Government's procurement processes if they perceive that the information provided was misleading or overly optimistic.
• Suppliers may pull out of the process, or be unwilling to participate in future procurements, due to perceived risks and uncertainties. This could lead to a reduced pool of potential innovative solutions.

Impact on the objectives

• The buyer may receive fewer high-quality or innovative solutions due to suppliers' reluctance to participate. This compromises value for money and the potential effectiveness of the end solution.
• The NSW Government's reputation for reliability and transparency in procurement may be damaged, leading to a lack of trust and cooperation from suppliers in future projects.
• The risk of formal complaints from suppliers may increase, leading to potential legal challenges and additional costs for the NSW Government to address and resolve these complaints.
• The agency's risk appetite for innovation may be reduced, hindering the ability to adopt innovation procurement in the future. This limits opportunities for progress and improvement.

Cause 

Adjusting a procurement strategy, including procurement stages or evaluation criteria, in response to emerging risks.

What may happen 

• Suppliers who have already invested in developing their proposals based on the initial strategy may feel disadvantaged or misled if the criteria or stages are changed midway. This could lead to frustration and a sense of unfairness.
• Some suppliers may withdraw from the process, feeling that the changing requirements or criteria make it too risky or difficult to continue.
• There may be inconsistencies in how proposals are evaluated if changes are not clearly communicated and understood by all parties. This could lead to disputes or dissatisfaction with the process.
• Suppliers may perceive the procurement process as unstable or poorly managed, reducing their willingness to participate in future tenders.

Impact on the objectives 

• The buyer may receive fewer proposals, reducing the competitive pressure and the likelihood of obtaining the best value for money and innovative solutions.
• The NSW Government's reputation for having a reliable and transparent procurement process may be harmed. This could deter high-quality suppliers from participating in future procurements.
• Increased risk of formal complaints from suppliers about the fairness and transparency of the process. This could lead to potential legal challenges and additional administrative costs for the NSW Government.
• The procurement project may experience delays or increased costs due to the need to address complaints, manage the fallout from changes, or re-evaluate proposals based on the new criteria.
• The agency's ability to adopt innovation procurement in the future may be compromised if stakeholders become more risk-averse due to negative experiences with changing strategies. 

Resources 

Read more about likely changes to a procurement strategy and change governance

Read more about the role of iterative discovery and agile project management structures
 

Cause

Evaluating solutions of diverse types and maturities against a single set of criteria. 

What may happen

• Innovative and emerging solutions may not score well against more established and mature solutions due to inherent differences in their development stage and risk profiles.
• Suppliers of emerging technologies may feel disadvantaged or unfairly evaluated, leading to disengagement or complaints.
• The evaluation process may become more complex and time-consuming, as evaluators struggle to apply a single set of criteria fairly across diverse solutions.
• Potentially innovative solutions may be overlooked or undervalued, resulting in a missed opportunity for more advanced or future-proof solutions. 

Impact on the objectives

• The buyer may miss out on the most innovative solution, leading to less suboptimal outcomes.
• The perceived unfairness in the evaluation process could damage the NSW Government's reputation among suppliers of innovative solutions. This may reduce willingness to participate in future procurements.
• Suppliers who feel they were unfairly evaluated may lodge formal complaints, resulting in additional time and cost investments.
• The evaluation process may become inefficient and resource-intensive, leading to delays in the procurement timeline and increased administrative burden.
• The agency's risk appetite for adopting innovative solutions may be reduced. 
   

Cause

More unique Intellectual Property (IP) considerations arising through proposals or deliverables that might inform how clarifications are managed or stages are adjusted.

What may happen

• Suppliers might be hesitant to share innovative ideas or proprietary technologies due to concerns about IP protection, potentially leading to less innovative proposals.
• Misunderstandings or disputes may arise over the ownership and use any IP developed or disclosed during the procurement process.
• The need for additional clarifications and adjustments in procurement stages to address IP issues may cause delays and increase the complexity of the procurement process.

Impact on the objectives

• The buyer may receive less innovative solutions if suppliers withhold their best ideas due to IP concerns.
• Unclear or unfair IP policies may damage the NSW Government's reputation as a fair and trustworthy customer, reducing supplier participation in future procurements.
• Disputes over IP ownership and use may lead to formal complaints or legal challenges.
• The need to manage and negotiate IP considerations may lead to delays in the procurement timeline, impacting project delivery schedules.
• Increased complexity in managing IP issues may place additional administrative burdens on procurement teams, affecting overall efficiency and resource allocation.
• The agency’s risk appetite for adopting innovative solutions may be reduced. 
   

Cause

Separate or siloed interactions with multiple suppliers within a stage.

What may happen

• Suppliers may receive inconsistent information, leading to confusion and misalignment in their proposals or deliverables.
• Perceptions of favouritism or unfair advantage may arise if some suppliers believe they have received more or better information than others.
• Important information may be missed or miscommunicated, resulting in misunderstandings and errors in the delivered solutions.
• Collaboration opportunities between suppliers could be lost, leading to less innovative or integrated solutions.

Impact on the objectives

• Perceptions of favouritism or unfair practices can damage the agency's reputation, leading to a loss of trust among suppliers and stakeholders.
• Inconsistent or incomplete information can lead to subpar proposals and solutions, ultimately affecting the quality and effectiveness of the delivered solutions.
• Managing suppliers individually rather than collectively can lead to inefficiencies, requiring more time and effort to coordinate and align their activities.