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Great procurement during COVID-19 – agency case studies

The recent events of COVID-19 and lockdown presented many procurement challenges for agencies. Here are some great examples from agencies where their approach to procurement in an emergency environment, has made a difference through speed, influence, intervention and insight.

Bringing Kiwis home during lockdown

The Ministry of Foreign Affairs and Trade (MFAT) delivered multiple repatriation flights to bring New Zealanders home. An example of this was three flights from India. This high risk, high value procurement would normally take a couple of months to implement. Instead, MFAT completed it in seven days, undertaking rapid market research, reviewing four proposals and managing the associated indemnity implications. The first flight departed New Zealand for India a mere 12 days after the procurement process began.

Sourcing PPE

Correction’s COVID-19 sourcing and logistics team met the challenge of procuring large amounts of personal protective equipment (PPE) for their entire network. Sourcing over 3.5 million PPE items from 42 different suppliers was no small feat. These items ranged from thermal imaging cameras, bed pans, surgical masks and loads of hand sanitiser.

Julie Robertson from Correction’s COVID-19 sourcing team says strong existing relationships with international and domestic suppliers, as well as being able to source all this equipment in good time, meant their people were kept safe. A huge strain was also placed on the courier system, so four regional distribution hubs were established to make sure PPE could be delivered locally with a certainty of delivery that couriers couldn’t promise at that time. Working closely with their frontline meant that the sourcing team could respond quickly to changes as needed. It was a great example of all parts of Corrections working together to ensure people were kept safe.

Encouraging best-practice procurement

One agency’s procurement team demonstrated their value by intervening in a procurement of hand sanitiser that an internal business unit were attempting. The team established that the product was sitting in a warehouse in SE Asia, was a relatively small amount, had not been authenticated and no proper due diligence had been done on the product or the supplier, and it was expensive.

It was also established that the existing All-of-Government (AoG) supplier for hand sanitiser had enough stock to meet their needs and as a result, the business unit was directed to abandon the procurement with the broker for the overseas supplier and use the AoG contract.

The subsequent direction to the entire agency was that in times of crisis, their first call has to be to their trusted, contracted supply partners just as the policy directs, rather than panicking and trying to explore new sources of supply immediately. If they had involved procurement at the outset, it may have saved them a lot of work and not raised expectations with the overseas supplier and their broker. Sometimes the value of an agency’s procurement function is not in the act of buying, but understanding, and mitigating, all the risks around commercial supply chains and taking a pan-Government view.

Supporting our children and schools

Educational TV channels

Once lockdown was announced, the Ministry of Education (MoE) needed to rapidly consider learning options for all students at school across New Zealand. Through the Education Review Office (ERO), they progressed talks with TVNZ and Māori TV to provide dedicated content for two learning channels (English and Māori mediums). It took 11 days to reach an agreement and the channels went live a few days later. In this short time, procurement brought together legal, business and operational units to wrap up a deal that was affordable and could be delivered.

School and early learner hard packs

Over 5,000,000 stationery items and educational products were purchased under multiple RFQ processes for inclusion in school, early learner, Māori medium and learning support packs prepared for home-based learners.

Sanitisers for schools and ECEs

MoE ran a closed RFQ for the supply of hand sanitiser to 6,700 schools and early childhood education centres (ECEs). This was prepared, issued, evaluated and awarded in three working days. The selected supplier set up a call centre and commenced distribution of ~30,000 litres of hand sanitiser to 4,200 ECEs and 2,500 schools within five working days.

Construction contracts

With the move to Alert Level 4, MoE had to close down over 240 of their own and 300 school-led construction projects. These required clear and urgent communications to suppliers on actions needed to close down projects safely and securely to minimise potential damage. MoE’s stance on legal clauses used to suspend services was later ratified by MBIE and Infracom as general guidance to the Construction sector.

MoE provided suppliers the opportunity to access retentions on live projects in order to release cash flow during lockdown. MBIE and Infracom released guidance to the public sector organisation and private industry on how contract claims relating to COVID-19 should be managed proactively pointing to the MoE’s practical guidance as a best practice approach.

This guidance is available on the Construction Sector Accord web page.

Construction Sector Accord

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