Changes to expect
Plan for an manage changes to a buying strategy to adapt to new information and manage emerging risks.
How to approach changes to an innovation buying strategy
An innovation buying strategy is a dynamic document. It is expected to change but all decisions must be well-governed. Buying teams can build confidence by anticipating information that is likely to become available through engagement and testing. They can then identify potential changes and articulate how their impacts will be managed for their buying project.
The new information could impact a buying strategy by resulting in changes to:
- budget or internal processes
- team resourcing or stakeholders
- risk profile, benefit or the business case
- governance structures
- supplier-facing procurement processes for an in-train or a future stage
- procurement stages or evaluation criteria
- deliverables, requirements or service levels
- the scope of the full opportunity.
Depending on the level of impact on the procurement strategy, buying teams may choose to manage a change by:
- informing relevant stakeholders
- consulting with subject-matter experts or affected stakeholders (including end users)
- seeking endorsement from a subject matter-expert or affected stakeholder
- seeking approval from a delegate such as a project manager and/or sponsor
- seeking approval from a governance body such as a steering committee
- seeking re-approval of the buying strategy
- notifying suppliers of a change
- restarting the procurement or a stage of the procurement.
The timing of the change would also shape how it is managed. For example: new information in an early stage, such as technical detail about a desired solution, would drive a change in a subsequent stage, such as technical criteria or the design of a trial. Usually a decision gate would already exist to manage that change in a responsible and transparent way.
If, on the other hand, new information affected a stage already underway, such as an unexpected technology solution not fitting into existing evaluation criteria, then more onerous governance may be required due to the perceived risk of unfairness, loss of probity or non-compliance.
Changes to expect
This page recommends a structure and some content that can be inserted into a buying strategy to plan for and manage changes to the procurement approach.
Expand the drop-down boxes to learn more about each of the changes that could occur to a buying strategy over the life of an innovation procurement, some likely drivers of those changes and considerations for buying teams planning their response.
Information available for the buying strategy
Initially, this section of a buying strategy will define a problem statement or outcome-focused scope and the engagement steps proposed where suppliers will provide staged deliverables such as demonstrations or Proof of Concept (PoC).
How this might change once the procurement starts
While the problem statement is expected to hold true, by the final stage this section will also be able to detail specific solutions and technical requirements.
Who might need to be engaged
Technical subject-matter experts such as enterprise architects, privacy and cybersecurity functions may need to advise on technical details as they become available, whereas their ability to advise on the project would be much more limited at the start.
Once a preferred solution is clear, formal approvals may be needed depending on agency processes. Approvals could relate to permission to proceed with a particular solution or to the solution’s technical specifications.
Project sponsors, the business where the solution will be deployed and end users may also need to be kept abreast of more technical information as it comes to light to ensure the final outcome meets objectives and is accessible.
Information available for the buying strategy
At the time of documenting a buying strategy, buying teams should have completed desktop market research to understand the sorts of technologies that have the potential to solve the innovation challenge, or comparable challenges. Armed with indicative technologies, they should be able to draw some conclusions about market maturity through a combination of internal expertise and external sources (e.g. Gartner or market aggregators).
Read more about sources of market information
Learn how to build market insights iteratively
How this might change once the procurement starts
For a less mature technology market, insights from desktop research may be limited. In these cases, buying teams should design their multi-stage procurement process to improve their understanding of the market. The first proposals from suppliers give insights into the market offerings and maturity which might lead to adjustments in later stages.
For example, if the market is offering mature and proven products, the buying team might have enough confidence to move directly into a testing or even scale implementation stage based on technical specifications. If the market is less mature and more information is needed to assess feasibility, then a more exploratory stage would be prioritised.
Who might need to be engaged
Engagement with an agency’s ICT team is critical for obtaining early market insights and designing procurement stages that will progressively improve insights. Agencies may have internal expertise on certain technology domains, such as artificial Intelligence (AI), or access to external information sources. An ICT business partner may be able to help identify all the expertise that needs to contribute to the buying project.
Solution architects might be able to help buying teams imagine potential technology solutions. Technology domain experts, enterprise architect, cybersecurity and data privacy experts can help refine requirements or gather information needed to assess a range of technical risks and assess supplier or solution information at each stage.
Information available for the buying strategy
The buying strategy should document evaluation criteria for each stage of the procurement. The confidence in these criteria would be highest for early stages of the procurement and lower for later stages. That said, starting with outcome-focused evaluation criteria should minimise the need for change.
For the initial proposal and early stages, proposals should be evaluated on how well they address the challenge and the supplier’s capability to deliver a solution. Criteria for later stages may focus more on the individual solution, e.g. assessing the solution’s functional and technical capability, with reference to requirements which would become more specific and technical in later stages.
Read more about documenting evaluation criteria
How this might change once the procurement starts
Outcome-focused evaluation criteria should not need to change over the life of the procurement. However, they should still be formally revisited between stages. This ensures they are appropriate for future stages, given the latest information and understanding of the solutions available. It is preferable to make a carefully documented and transparently communicated change to criteria than to push ahead evaluating the wrong things.
Evaluation criteria will almost certainly need to change if there is a change in the number or type of stages that make up the procurement. Any adjustments to criteria should be made at the same time as adjusting stages.
Who might need to be engaged
Evaluation criteria must be endorsed by the Evaluation Committee members who will need to use the criteria. An Evaluation Committee should never be asked to use criteria that they do not understand or are not comfortable with. A procurement representative may need to approve evaluation criteria changes through a stage-specific evaluation plan that highlights and justifies any changes from the original evaluation plan.
Changing evaluation criteria can introduce probity risks, such as perceived unfairness or bias. Proactively communicating and justifying any changes to suppliers is critical for maintaining the integrity of a staged procurement. This is a risk that should be managed, not removed. If removed, a much greater risk would arise of investing in the wrong solution.
Information available for the buying strategy
The buying team should connect with a wide range of expertise before finalising a buying strategy. These experts should have input to the strategy itself and help design stages to ensure the appropriate information is uncovered at each stage. The procurement strategy should identify these stakeholders and their roles, including decision-makers and any groups with governance oversight such as sponsors and committees.
Read more about how to mobilise a buying team, or engage the right experts.
How this might change once the procurement starts
As the understanding of solutions and suppliers improves through each stage, the type of expertise or oversight needed might change. For example, if AI solutions are proposed by suppliers, new domain expertise and assurance-related approvals may be required. Proposals could include unforeseen integration points, security risks or other technical complexities. These would change the risk profile for the project and the type of governance or oversight required.
Who might need to be engaged
All buying team members should be informed about changes to governance structures. The project sponsor, financial delegate or, if there is one, a steering committee may need to give formal approval of a change to governance. Other senior stakeholders, or even organisational governance groups, might need to attest that appropriate expertise has been included, such as ICT or legal.
Information available for the buying strategy
The buying strategy should document the intended Evaluation Committee. Its members should include the full range of expertise needed to assess key attributes of proposals and solutions. When the procurement strategy is being prepared, the expertise deemed relevant will be driven by market research. Since the solution is unknown, the Evaluation Committee membership will be a best estimate at the time.
How this might change once the procurement starts
Once proposals have been received and more is understood about the market, evaluation for future stages may require expertise that was not identified initially. For example, if AI solutions are proposed by suppliers, new domain expertise might be required to refine criteria and participate in evaluation.
Consistent membership of Evaluation Committees is tied to probity and should be the goal wherever possible. Changes to committee membership should occur between stages rather than within a stage.
Who might need to be engaged
The level of approval or endorsement needed for changes to Evaluation Committee membership can vary from project to project. As a minimum, the approvals should mirror those for an evaluation plan. All committee members should have the opportunity to endorse membership, just as they should endorse the criteria. This is because the make up of the committee will give them confidence that they can carry out their duties effectively.
If a change to Evaluation Committee membership is proposed within a stage, a probity advisor (internal or external) should be consulted. This is so that risks of perceived unfairness or of changed expectations can be weighed up against the risk of not having access to the desired expertise. Treatment options can then be explored to find the best balance.
Learn more about probity risk and probity risk and advisors here
To learn more about setting up an evaluation committee for success, contact the Test and Buy Innovation advisory team.
Information available for the buying strategy
At the time of writing the buying strategy, buying teams should have some indication of market maturity (see the separate drop-down box on market research). Since multi-stage procurements are designed to gather evidence on solution feasibility and supplier capability, a less mature market should drive a buying team to build in more testing stages. If it looks like the market might be able to offer one or more established solutions, fewer testing stages might be required.
Each proof stage is an opportunity to assess the benefits of innovative and less familiar solutions while gathering more information and increasing confidence in both the solution and the supplier. The right number of stages will vary for every buying project, but a helpful measure to guide decisions is the technology readiness level (TRL).
Read more about the role of technology readiness level in designing stages.
How this might change once the procurement starts
Once proposals have been received and/or assessed, the buying team will have a better idea of market maturity. If the market is more mature than expected, the team might choose to reduce the number of testing stages compared to what was planned. If it is less mature (including if a small selection of proposed solutions are not mature but of high interest), the team may choose to add more testing stages.
Adjusting the type and number of testing stages to market maturity can feel like taking a risk because it is a change in the buying strategy. Not adjusting can waste supplier and government time and resources (for mature products). It can also create a much bigger risk of not having enough information to inform the final decision (for less mature products). Probity risks associated with changes to testing stages should be managed through open communication about reasons rather than by removing the risk entirely and not changing.
Who might need to be engaged
The buying team and the governance structure will need to agree in advance whether a change in the number, or type of stages, requires full reapproval of the procurement strategy, and follow the change management plan.
Subject-matter experts contributing to stage design and evaluation should be consulted, or at least informed. Additional subject-matter experts may need to be brought in, depending on the type of proof involved in any new stages.
Finally, all suppliers must be notified of the change in strategy, usually via an addendum to the sourcing documents, including the reasons for the change. They should also be given the opportunity to ask questions. This transparency can help avoid the perception of unfairness or bias.
Information available for the buying strategy
Buying teams can estimate timelines for the buying activities in each stage based on sample innovation buying pathways, adjusting to reflect their own level of project resourcing, the complexity of approvals required for their project and any other agency variations.
As with any procurement, timelines are best estimates made without knowing how many proposals will need to be evaluated or competing priorities arising. Given the agile and iterative nature of innovation procurement, teams will need to be transparent with stakeholders that timelines are indicative and may change as new information arises, and be proactive about communicating changes when they happen.
Read more about documenting timelines.
How this might change once the procurement starts
All procurement timelines are subject to change due to resourcing, competing priorities, number and complexity of proposals and evaluation consensus processes. Innovation procurement buying teams can expect to spend more time on evaluation and between stages compared to standard procurement, considering the impact of any new information on the next stage.
As seen under the Testing stages drop-down, stages may be added or removed and this would change timelines. As a minimum, timelines should be revisited and adjusted between each stage.
Who might need to be engaged
Typically, changes to timelines would not be considered a change to the overall procurement approach. Therefore they would likely go through a lower level of governance such as a project manager and/or sponsor.
Any subject-matter experts expected to provide time-sensitive inputs should be given as much notice as possible for any changes. Ideally their time is booked in advance and those bookings adjusted as needed, to avoid delays due to availability.
Suppliers should also be notified of significant changes to timelines. Suppliers deserve clarity in return for the investment of their time and energy. Clarity also helps them allocate resources to future stages and participate effectively in the procurement. Each buying team or agency might have its own view of what counts as 'significant'. As a minimum, supplier communication milestones should be respected, even if it is to communicate a delay.
Information available for the buying strategy
Some risk information can be quite comprehensive at the start of a buying strategy, like probity risks. However the ability of the buying team to assess more technical risk categories like security and solution integration will depend on the quality of market research (see separate drop-down box).
When dealing with more mature markets that might have solved similar problems before, buying teams can form a view of the technical risks that might apply. They can then build controls into the request for proposals and evaluation process from the outset.
For less mature markets, buying teams might need to build in a step after proposals are received to look at the types of solutions proposed, and the risk controls required for the next stage.
The point at which risk profile changes need to be escalated will vary between agencies and projects. Buying projects should define these escalation points upfront.
How this might change once the procurement starts
Once proposals are received and evaluated, and after each subsequent proof stage, the buying team’s understanding of solution and supplier risks should improve. New risks and controls will almost certainly be added to the risk register with each stage. Some might be significant enough to be highlighted for decision-makers. They may even drive changes in the strategy by changing the testing stages (see separate drop-down box).
Who might need to be engaged
Changes to the risk profile of a buying project typically wouldn’t be seen as a change to the buying strategy (unless a change to the strategy is needed to mitigate a risk). Therefore, an updated risk management plan would likely need to be approved by, or at least communicated to, a project manager and/or sponsor.
Subject-matter experts in the risk domain may become risk owners or need to contribute to risk controls. They should therefore be proactively consulted as part of the risk management plan.
Information available for the buying strategy
Buying teams should be able to identify high level qualitative and quantitative benefits of solving for a specific outcome within a buying strategy. These can include measurable improvements to engagement, efficiency or productivity benchmarks. Those early stage buying projects that lack quantifiable benchmarks can draw on parameters that might be known. This helps to quantify benefits in later stages of the procurement, such as number of users, business processes or services that could be positively impacted.
How this might change once the procurement starts
At the start of the procurement, supplier proposals should give buying teams an indication of whether the challenge can be solved. A Proof of Value (PoV) stage could be used to validate whether indicative benefits can be realised for shortlisted solutions. At any stage, information about pricing models could help inform budgets and cost/benefit estimates. Later stages such as a Proof of Concept (PoC) or trial could gather more detailed cost estimates to inform a final business case.
Who might need to be engaged
If a business case is required for funding the final implementation, procurement stages should be designed to validate and quantify benefits to substantiate claims in the business case. Appropriate subject-matter experts should contribute to both the design of stages and the evaluation of information gathered. This includes end users or the owners of the business processes, solution architects and commercial experts.
As benefits are refined, the buying team might identify 'go' or 'no go' decision points and can design stages to ensure information is gathered to support those decisions. These points will need to be documented and communicated to the relevant governance structure. This could be a project sponsor, financial delegate or steering committee.
Read more about governance roles.
Information available for the buying strategy
Constraints and dependencies could include technology limitations or requirements, such as system integration points or security requirements, as well as non-technical matters such as business processes, access to information or resourcing.
Based on market research, the buying team should have a view on the potential solutions that could be put forward by the market and the technical constraints that might apply. The buying team can therefore identify constraints and requirements that might be part of the market approach. They will need to foster a high-level and outcomes-based market approach that can best attract innovation while communicating constraints in a way that minimises time wasted by suppliers that can’t meet them.
Read more about setting flexible vs mandatory requirements.
How this might change once the procurement starts
At each stage of the procurement, more information will be gathered about potential solutions. Therefore more will be learned about what technical requirements might apply, which systems might need to integrate, and which business processes or information sources could contribute to the success of the final solution.
These constraints should be incorporated into stakeholder consultation, evaluation and eventually implementation plans. This should occur as soon as possible after being uncovered to minimise surprises.
Who might need to be engaged
If new constraints emerge that might need to be tested in a way that results in a change to stages and therefore a change in the buying strategy, reapproval of the strategy might be required.
If the strategy does not change, then consultation with the relevant subject-matter experts will be sufficient. Approval from a project manager or sponsor may be needed if key project activities or timelines need to change.
If new constraints are reflected as requirements for a stage and are going to be evaluated, ensuring the right make-up of the evaluation committee and getting the endorsement of committee members will also be essential.