Design a buying pathway
Explore supplier engagement options to map a pathway that achieves your business objectives
Design an innovation buying pathway
After choosing whether to plan for scale, a buying team can choose one or more engagement methods to design an innovation buying pathway that meets their innovation and buying objectives. A buying team that has chosen option A (plan for scale) will choose one or more methods as separate procurement stages before a scale implementation stage. Option B (test and learn) will usually involve a single method, and will not proceed to implementation at scale.
Designing a buying pathway takes approximately 1-2* weeks and involves:
- Exploring innovation tactics and benefits.
- Choosing the tactics that best support the business objective.
- Exploring the library of example innovation pathways including those taken by projects with similar buying scenario and objectives.
- Building an indicative pathway that includes activities, milestones, and estimated timelines.
*Will vary according to agency policies, processes and project complexity.
Supplier engagement options
Expand the accordions below to explore a range of supplier engagement options or innovation tactics. Understand when they can be used to encourage innovation and test solutions and supplier capability, and how they can support your buying objectives.
Before starting procurement activity, it can sometimes help to better understand the industry that might supply the solution. There are several established methods for industry engagement, you can read about the types of engagement that are possible and how to approach them here.
Benefit of using this tactic:
- helps validate that the problem statement makes sense, and captures the right information and detail
- provides early access to industry insights and expertise
- optimises suppliers’ understanding of requirements to enable them to submit proposals
- can help understand the capabilities and solutions available in the market, and to choose procurement tactics that will best prove and evaluate
- identifies opportunities for a consortium of suppliers to address a solution
- supplier visibility of the procurement process upholds expectation, and perception of transparency and fairness.
Engaging suppliers during procurement is generally done through open briefings, question and answer sessions, more intimate clarification sessions or more. It is critical to be clear on what information can and can’t be provided to suppliers to maintain the probity of the procurement activity, to provide all suppliers the same opportunity to access that information to ensure fairness, and to record all communications for transparency.
Benefit of using this tactic:
- Optimises suppliers’ understanding of requirements, enabling them to put forward solutions that solve the problem effectively.
- Upholds supplier expectations and perceptions of transparency and fairness, and improves overall working relationship.
- Can improve suppliers’ understanding of NSW Government priorities and public procurement processes more generally, enabling their growth and increasing competition.
- Buyer can develop a deeper understanding of supplier capabilities, and shape the procurement pathway accordingly.
Testing and learning can be done with multiple suppliers within a single procurement process by developing a multi-stage procurement strategy. For example, three suppliers might be short-listed based on their proposals after a competitive market approach and invited to participate in a proof stage such as a proof of concept or trial, before narrowing the field again to one or more preferred suppliers. Each stage generally has its own proposal and evaluation criteria that are re-assessed before the next stage, as more information is available about the solutions and suppliers.
Benefit of using this tactic:
- testing multiple suppliers at multiple stages provides greater certainty that a solution is the right one
- offers ability to select one or multiple vendors to collaborate on a combined solution, or to provide separate components of solution.
Suppliers invest time, people, and other resources when they participate in proofs or trials. Larger suppliers often absorb this cost, but smaller suppliers may not be able to risk such an investment without guaranteeing an outcome. Buyers are encouraged to compensate suppliers for proofs of value, proofs of concept and trials, even though some suppliers may offer this for free.
Benefit of using this tactic:
- Attracts more proposals, including from smaller suppliers who often don’t participate in tenders because they either can’t afford to offer testing or trials for free, or don’t believe time invested will result in the reward of any significant sale.
- May result in discovery of a better fit solution rather than just an established one.
Improves supplier capability when multiple suppliers are compensated to participate by giving more start-ups and small medium enterprises (SMEs) the opportunity to work with government and learn, regardless of the final tender outcome. - Diversifies and strengthens the industry by leveling the playing field rather than preferencing larger enterprises who can afford to offer free of charge.
Note: Buyers should be aware that there may be a need to safeguard intellectual property of suppliers participating in a co-design, Proof of Concept (PoC) or trial as part of a multistage procurement, or test-and-learn activities that inform a tender. These should be addressed through the terms of any agreements and communicated transparently to suppliers.
In simple terms, a pitch event is a competitive process where suppliers compete with others in the same field to win business.
A supplier pitch is a Proof of Value (PoV) presentation that may include the supplier background credentials and capability, solution value proposition, competitive advantages, features and benefits, solution demonstration, and technical overview.
In the NSW Government, a pitch is a component of a Request for Proposal (RfP) process where the tender is openly advertised, or limited suppliers are invited to participate in the process and submit their proposals.
Benefit of using this tactic:
- Including a pitch event in the RfP stage provides an opportunity to compare and evaluate supplier solutions in ways that might not be possible from a written submission.
A hackathon is where software technology professionals collaborate rapidly on software projects and produce a low-fidelity prototype. Teams develop innovative solutions and prototype the most promising ideas in a limited period. Contributors may include enterprise architects, solution designers, service designers, UX and UI designers, project managers and end-users.
In the context of the NSW Government, a hackathon may be part of a procurement process that involves a strategic supplier for the entire government. It could also be a more exclusive event where a limited number of suppliers participate. Suppliers, solution designers, service designers, user interface designers, project managers, business users, and end-users may be contributors.
Benefit of using this tactic:
- hackathon event optimises supplier ability to better understand problems, prepare properly, and submit better proposals.
- hackathon provides ability to test a solution hypothesis with stakeholders and gather evidence of success before deciding to buy or develop.
- hackathon events provide certainty that suppliers understand problems, can work collaboratively in a time-boxed manner, and can put forward tangible solutions/ prototypes for evaluation.
Co-design refers to a participatory approach to designing solutions where community members collaborate in the design process.
Co-design is a well-established approach to creative practice within the public sector. It is often used as an umbrella term for participatory, co-creation, and open design processes. This approach goes beyond consultation by building and deepening equal collaboration between citizens affected by or attempting to resolve a particular challenge. A key tenet of co-design is that users become central to the design process as ‘experts’ of their own experience.
The public sector has adapted co-design to combine lived experience and professional expertise to identify and create an outcome or product. It builds on engagement processes such as social democracy and community development where all critical stakeholders, from experts to end users, are encouraged to participate and are respected as equal partners, sharing expertise in the design of services and products.
Key components of a co-design process should involve:
- intentionally involving target users in designing solutions
- postponing design decisions until after gathering feedback
- synthesising feedback from target users into insights
- developing solutions based on feedback.
Co-design is a process, not a single event. Additionally, this process can be iterative — so even after you have released or launched a product, you can still go back to the community to get feedback and design improvements.
If one of the key purposes of open data is to benefit the public, then it follows that governments should work with the public to ensure that open data is being released and presented in ways that meet community needs and desires. Otherwise, they risk pouring a lot of effort into products that may not end up getting used or that are very challenging to use.
In the NSW Government, co-design may be a component of a procurement that involves an All of Government strategic supplier, or where limited suppliers are invited to participate.
Benefit of using this tactic:
- co-design optimises supplier ability to better leverage stakeholder IP, understand problems and work collaboratively and iteratively towards a solution
- co-design provides ability to test a solution hypothesis with stakeholders and gather evidence of success before making a decision to buy or develop fully
- co-design provides certainty that suppliers understand problems, can work collaboratively in a time-boxed manner, and can put forward tangible solutions/ prototypes for evaluation.
Bring your pathway to life
Map out your pathway
Once buyers have explored the innovation tactics and benefits, it is time to draft a pathway with the procurement and engagement approaches that best support business objectives. Your pathway will include all the associated milestones, timelines and key activities.
Resources
To get started, buyers should consider reviewing the innovation pathways sample library, which is available for supervised access. Navigating the library under guidance is important because all pathways must be tailored to business objectives.
Review the library of innovation pathways.
For help building a suitable innovation pathway, or resourcing support to lead this activity, please contact the Innovation Procurement Pathways advisory team directly at InnovationProcurement@customerservice.nsw.gov.au.
To refine the pathway and start to build a procurement strategy, buyers should first mobilise a buying team of subject matter experts who can contribute their knowledge.
Read about how to mobilise your buying team.
Equipped with a draft pathway, buyers should define the scope of innovation that will be the basis of the market approach. Innovation scope will capture insights that help the buying team understand the problem, market intelligence that can inform some likely (but non-exhaustive) solutions and lead to a detailed and optimised innovation pathway.
Read how to scope for innovation.
Prepare documents
Once you have built your pathway, you will need to prepare an innovation Procurement Strategy and Statement of Requirements (SOR) documentation for formal approvals (estimated 2 - 4* weeks duration).
*Will vary with NSW Government agency policies and processes, project complexity and adequacy of stakeholder consultation.
Resources
Coming soon - guidance to support buyers to complete an innovation procurement strategy.
Obtain approval
Estimated 2 - 4* weeks duration.
*Will vary with NSW Government agency policies and processes, project complexity and adequacy of stakeholder consultation.