2 Nov 2012

IPA in Scotland response to Public Sector Procurement Reform Bill consultation

The IPA in Scotland welcomes the opportunity to submit views on the above.

A         About the IPA

The Institute of Practitioners in Advertising in Scotland is the trade body and professional institute for Scottish advertising, media and marketing communications agencies. 

Our 21 corporate members, who represent the Scottish agencies within the UK-wide IPA, handle the majority of Scotland's advertising agency business, of which government and semi-government bodies form a critically important part.

As such, we are vitally concerned with – and heartily applaud – any measures which are designed to improve the processes by which our members can be appointed to this activity.

B         How we have approached this consultation
In addition to completing the specific questions raised with regard to this consultation (separate document attached), we have surveyed our membership in Scotland to obtain their views on the current position vis-à-vis public procurement in Scotland.

Since the majority of these companies are SMEs, which the Government would like to encourage and see actively involved as its suppliers, we believe their opinions are important in any future procurement process which might be adopted with specific reference to marketing communications.

We have noted below a series of concerns around current procurement practices which, together, underline the critical need for reform in this area.

C         How our members currently view public sector procurement

Our responses are broken down into four sub-sections. Specifically:

1.     Process vs. outcomes

Members expressed considerable concern that the current procurement process is ill-suited to the selection of the most appropriate agency to deliver effective communications to Government. There is a widespread belief that, due to the mechanistic and quantitative measures assessed, the process is designed to arrive at the lowest cost, rather than the most effective outcome.

This tendency to commoditise creative marketing services forces agencies to offer a significantly lower rate to Government than would be proposed to commercial clients to win initial ITTs, only to be asked to discount again to win mini-competitions.

Although this might seem, on the surface, to deliver value for money for the tax-payer, in reality it makes un-commercial demands on agencies, who find themselves struggling not just to produce effective work, but in some cases, even to survive.

With no apparent quality/qualitative checks of tendering agencies’ ability to fulfil contracts, tender submissions may currently ensure the Government pays the absolute minimum for the work it receives, but they offer no guarantee of its likely effectiveness.

2.     Understanding marketing services

While procurement may strive to standardise procedures, buying advertising and marketing services is very different to buying concrete items or services that have a more physical outcome.

Creativity thrives on personal contact. The absence of opportunities to meet prospective clients face-to-face during the tender/pitch process inhibits understanding and prevents the formation of personal relationships. While this may be deliberate in order to preserve impartiality, in reality, it acts against the development of the most effective creative work.

At a time when commercial companies are increasing their efforts to ensure the right ‘chemistry’ between themselves and their marketing services suppliers, it is significant that government/semi-government bodies rarely, if ever, visit agencies. This leads to concerns amongst our membership of not only a lack of understanding of agency business models, but also of sufficient knowledge and experience to judge the quality and potential effectiveness of the work being produced.

3.     Bureaucratic Process Burdens

ITTs are universally felt to be over-complex, difficult to complete and frequently expressed in a language which the world outside procurement finds difficult to understand.

While our members are held rigidly to their timetables to submit, it is
pointed out that procurement have in the past frequently moved their own deadlines two to three times – apparently with little regard to the suppliers involved.

Moreover, mini-competitions repeatedly request the same information in slightly different formats, such that agencies can spend more time on submitting proposals than they do working on the creative solutions the tenders are designed to deliver.

In addition to this, there is a marked inconsistency and lack of clarity on the criteria on which projects are or are not taken to mini-competitions, how these are briefed and subsequently judged.

All the above imposes an enormous burden on small companies whose expertise lies in developing creative solutions to address public behaviour, not wading through bureaucratic and, what is seen to be, inappropriate and unnecessary paperwork.

4.     Unrealistic demands on tiny budgets

While, superficially, it may seem fair that public tenders are thrown open to the market-place as a whole, it is frequently the case in Scotland that this approach is massively wasteful not only in terms of the competing suppliers, but also of the time required by procurement to judge the resulting submissions.

The IPA/ISBA/CIPS/MMA Best Practice Guidelines suggest a maximum of four agencies should be involved in a pitch.

In Scotland, however, it is not uncommon for up to 20 companies to compete for public service projects of only £15-£20,000.

This is not an example of the market working well - enabling Government to select from the widest possible field – it is a waste of national resources and sets a poor example to the commercial sector from a body which should be acting responsibly and as an exemplar.

D         Our hopes for the future

It is against this backdrop that we applaud the Scottish Government's initiative to simplify and render more user-friendly its procurement activities.

Scotland has always had some of the finest creative minds in the world, but if these are to be harnessed most effectively to the nation's good, the processes by which they are employed must not be bogged down in needless paperwork.

On this basis, we have great hopes for – and thoroughly endorse – the proposed Reform Bill.