In our previous publication, we talked about the general functionality of the BI Prozorro module and how it helps to develop the public procurement sector in Ukraine. This time, we will share how this tool helps procuring entities with their work.
In Ukraine, several million tenders for public funds are held every year. In order to analyze their successes today and fix mistakes or improve processes in the future, procuring entities and their governing agencies have to process significant volumes of data. This is where the BI Prozorro module steps in. We have previously talked about the features of this tool in general, and today we will focus on the functions that BI Prozorro provides to procuring entities.
The tasks that procuring entities most often encounter when they analyze data on public procurement can be grouped by periods of their occurrence:
- procurement planning and preparation;
- conducting tenders;
- analysis of the effectiveness of completed procurement.
Procurement planning and preparation
The procurement process is almost continuous. Therefore, procuring entities are constantly starting new procedures and signing contracts. The BI Prozorro module helps them prepare for new purchases faster and better. For example, procuring entities can calculate average market prices for the necessary product or service to estimate the optimal expected cost. This reduces the number of both unsuccessful tenders (due to low initial cost) and overpriced ones, in which the procuring entity risks overspending.
The module is also indispensable for situations when the procuring entity buys goods or services for the first time. The module contains information on all purchases that go through the Prozorro system, so employees can filter out tenders that are as close as possible to the one they need to conduct themselves. Then, it is convenient to choose the most successful purchases among them, with the largest number of participants, savings, no appeals, etc., and explore them. Procurement officials can use the documentation of their colleagues as an example to form non-discriminatory requirements to business on their own tender. They can also look at the questions asked by the participants of the previous tenders to include this information right away.
Procuring entities are interested in more participants coming to them for competitive procurement. It is the high competition that helps to purchase goods for the lowest prices. With the help of BI Prozorro, procuring entities can select all companies that sell the desired product or service in Ukraine or a particular region, and invite them to tender. Before that, staff of budgetary institutions can use the participant analysis in the module and their prior experience with other procuring entities, thus identifying the contractors they would most like to work with. For example, it is unlikely that the procuring entity will invite a firm to participate in an auction if it has previously been guilty of terminating multiple contracts or is under dissolution.
What is more, procuring entities can communicate with potential suppliers even before the tender starts, at prior consultations. This helps take into account the feedback and form tender documentation in a way that would enable the maximum number of suppliers to participate. For instance, there was a case in Vinnytsia when a medical institution held a tender without a single bid. Before the next attempt, the hospital decided to talk to local suppliers and find out what the problem is. After these prior consultations, the procuring entity broke down the procurement into 4 separate lots, amended the documentation, and had multiple participants in the next tender, who even reduced their prices to get the contract.
Procurement analysis: identifying best practices and weak links
Even the most professional and experienced experts cannot make all purchases perfectly. Therefore, after the contracts are signed, there is another important stage ahead of them: analyzing the effectiveness of completed tenders. The BI Prozorro module contains a number of performance indicators that are calculated automatically, as well as their visualization—various charts and graphs. Procuring entities can view the dynamics of their results, a breakdown by CPV codes, results of all tenders or part of them, etc. In addition, all information and its visualization is easy to download. This makes it much easier for employees of budgetary institutions and enterprises to report on their procurement, because they do not need to process data manually.
In BI Prozorro, you can both identify your strengths and find errors in your work—both systematic and isolated. For example, by filtering out tenders that were subsequently terminated, experts can look at the reasons for failure and identify the main ones. It is possible that the contracts do not specify the terms of their implementation, or most of the terminated contracts have been with a specific contractor.
Moreover, the module helps the institution determine how many employees need to be hired for procurement. All procuring entities have different needs and available funds. Here is a story that was once shared by a BI Prozorro user: “We were in for layoffs in our department. The management explained that in a similar enterprise, they had the same number of tenders, but only two employees. I conducted a detailed analysis of procurement, because the module allows you to make many different samples. And it turned out that most procurement in that enterprise was simple and for low amounts, usually simple direct agreements, while we held open bidding, as well as open bidding with publication in English. After that, the management decided to keep the necessary number of specialists.”
The variety of filters, indicators, charts in BI Prozorro allows procuring entities to solve many more tasks in the module. What is important, by optimizing the processes, you can accelerate and simplify routine tasks, as well as mitigate the number of accidental errors in tenders. Therefore, procurement and, accordingly, the use of budget funds reach a qualitatively new level.
This article was prepared by Serhii Pavliuk, BI Prozorro Project Manager with TI Ukraine, and Kateryna Rusina, DOZORRO Communications Manager, with the support of the Visegrád Foundation within the project “Tackling corruption in public procurement in Ukraine and V4 countries with new approaches.”
The variety of filters, indicators, charts in BI Prozorro allows procuring entities to solve many more tasks in the module. What is important, by optimizing the processes, you can accelerate and simplify routine tasks, as well as mitigate the number of accidental errors in tenders.