Technology Procurement in the Public Sector- The Case of PPI & PCP in the EU

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The rise of the Internet of Things and the move towards Cloud Computing has brought a fundamental change within all segments of the software industry.  Digital transformation of organizations to achieve digitization is the main driver of innovation and competitive advantage creation. Hence, if organizations want to remain competitive in such a technologically dynamic environment they must remain open to change. I often converse with technology procurement leaders within the public sector in many countries around the world. It is obvious that they face challenges.  Even though they do not feel the pressures of the private sector, they do feel the pressure to support the digital transformation of their organizations. Their main challenge is that they must balance the need for speed and agility with the reality of a regulatory environment that is inflexible and rigid. They have realized they cannot simply say “it is what it is” though . They need to find ways to support public sector technology innovation. Their constituents are demanding more automation and easy to use services. The European Union developed two procurement vehicles that can be used to drive innovation within the public sector. PPI, which stands for Public Procurement of Innovative Solutions (PPI) and PCP, which stands for Pre-Commercial Procurement (for more info go to https://ec.europa.eu/digital-single-market/en/innovation-procurement). PPI & PCP appear to be very interesting for technology public procurement leaders working in European Union Member Countries. When it comes to PCP the European Commission wants Public Procurement to lead more R&D efforts. It should be music to the ears of those who want to drive innovation and digital transformation. Here is the link that provides guidelines of how the process works https://ec.europa.eu/digital-single-market/en/pre-commercial-procurement. Also, there is a list of examples and showcases to help you understand how this public procurement vehicle has been used in the past https://ec.europa.eu/digital-single-market/en/news/pre-commercial-procurement-showcases. The goal of the Commission is to allow for cross-Member collaboration and drive innovation. They have created funding programs such as Horizon 2020 that was extended due to Covid (for more info https://ec.europa.eu/digital-single-market/en/news/calls-eu-funding-opportunities-pre-commercial-procurement-and-public-procurement-innovative ). It would be very interesting to have conversations with tech procurement leaders within public organizations who have had the chance to get involved with such projects. If you are a Gartner client and want to have an interaction on the topic please don’t hesitate to schedule a call with me. If you are not, you can always comment here and share your thoughts. This is the first blog on the topic of public procurement. I will be writing next on the topic of public sector tech marketplaces. If you have any public procurement topics that you would like to see me writing about, don’t hesitate to comment.
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