Is your organisation subject to public procurement policy? If you are planning to embark on an ERP or other large IT solution implementation you may need to follow strict rules for tendering via the Official Journal of the European Union (OJEU). This article explains what OJEU is and its implications for selecting an ERP supplier.
What is OJEU?
OJEU stands for the Official Journal of the European Union. It sets out the EU’s legislation governing public procurement and lists all relevant tender notices and contract awards within the EU. OJEU is intended to provide suppliers across the EU with a fair and equal opportunity to bid for public spending in any member state. It includes a set of procedures that aim to ensure transparency of the tendering process and best value for taxpayer money.
Who does OJEU Apply to?
When Public sector bodies procure goods and services, they must comply with UK legislation that applies the European Union’s rules on public procurement.
Certain Third Sector bodies also come within the scope of the rules. Contracting authorities include organisations that exist “for the specific purpose of meeting needs in the general interest, not having an industrial or commercial character” and are mainly financed by or subject to “management supervision” by another contracting authority. The rules also apply to charities whose boards have more than half their members appointed by another contracting authority. Each NFP must work out whether it is in such a relationship.
Procedure options
OJEU defines a number of potential procurement procedures (e.g. Open, Restricted, Competitive Procedure with negotiation, Competitive Dialogue), all with their own rules and guidelines. There is also the option of using existing Framework contracts that are already in place if your organisation qualifies to access them.
It is essential that the right procedure is chosen to minimise the procurement effort and maximise the chance of ending up with the best option at the best possible price. The requirements for ERP and other complex IT solutions, particularly in the context of large organisations, are by their nature difficult or impossible to define fully up front and often lend themselves to procedures than provide for flexibility and dialogue during the procurement process. Also, some Framework routes, while initially looking promising may limit supply options and restrict the process: preventing ‘drains up’ supplier and solution evaluation and acting against getting the best possible commercial terms in what is a dynamic, fast changing market place.
As well as the challenges around defining business need and required ERP capabilities there can be many nuances around how the solution will be delivered and who by, which will impact how the procurement will be approached. For example, is your organisation insisting on a full ERP suite from a single vendor or is it open best of breed approach? Is it insisting on SaaS, on-premise or Cloud hosted solution(s)? What about options for different vendor combinations for software, implementation services, hosting and support?.
Whatever procurement procedure is chosen it is essential to follow the right steps to make sure that the process is completed in the visibly fair way as stipulated and minimise the chance of legal challenges.
Will there be changes after Brexit?
The procurement regulations will remain broadly unchanged after Brexit. However, when the UK exits the European Union contracting authorities will need to publish public procurement notices through Find a Tender. This service will go live on 1 January 2021. It will replace the requirement to publish notices in the Official Journal of the European Union. Other than that the EU directives have be
Sources:
https://www.instituteforgovernment.org.uk/explainers/procurement-after-brexit
ITSS Limited works with Third Sector and Public Sector organisations to help them procure and implement ERP, Financial, HR and other strategic business IT Solutions. This original blog was published on www.itsslimited.com
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