Graduate Diploma in Purchasing and Supply. Public Sector Stakeholders and Governance L6-14 LEVEL 6. Senior Assessor s Examination Report

Transcription

1 Graduate Diploma in Purchasing and Supply Public Sector Stakeholders and Governance L6-14 LEVEL 6 Senior Assessor s Examination Report November 2009

2 SECTION A Taking the role of the head of procurement of the neighbouring council to CCC: Q1 Identify the key internal and external stakeholders in the CCC proposals, and evaluate their influence using a recognised model. (25 marks) Analysis of the Question The question had two clear requirements; identification of the key internal and external stakeholders in the CCC proposals and an evaluation of their influence using a recognised model. Candidates should assume equal marks are allocated for each requirement and answers should be planned and structured accordingly. Candidates should also identify a recognised model and use it to develop their answer to the second part of the question. For the first part of the question, identification of stakeholders, there are some stakeholders mentioned in the case study itself, and most of these were identified by candidates; but good answers were expected to deduce the existence of several other significant stakeholders and stakeholder groups from the case, from the candidates studies, and their own knowledge and experience. Better answers made it clear which stakeholders are key and internal and external. Stakeholders were identified from both of the HoP s own Council ( internal ) and from CCC and elsewhere ( external ). Examples of stakeholders would include procurement staff; other staff; financial managers; directors; professional groupings; councillors; local businesses; local business pressure groups; the electorate at large; council taxpayers; local suppliers; larger suppliers; Trades Unions; local press; local TV; professional bodies; OGC; local MPs and more. Candidates were instructed to use a recognised model for their stakeholder evaluation, and the most popular model chosen was Mendelow, as this model is identified specifically in the Learning Outcome and the syllabus content. Any other recognised model was also fully acceptable. Some candidates chose to illustrate their responses with a stakeholder influence chart or stakeholder mapping to inform and supplement their response; but that type of chart or diagram alone was insufficient to fully address the question requirements with a command word of evaluate. Exam Question Summary The question was well answered by the majority of candidates and there was an impressive range of models and techniques used supporting some insightful evaluation. Poor answers only centred on internal stakeholders and to some extent suppliers but gave no breadth to the answer or the context of the wider community. Better answers L6-14/Nov09 SA Report 2

3 linked the power and influence Mendelow matrix and explained how stakeholders could be categorised in the case study and how to communicate and manage them. There were a few extremely good answers bringing into the stakeholder list including community groups, police, residents groups, lobbying groups and links to the national agenda. One point some candidates ignored was councillors and their role. Q2 Prepare an informal report to your chief executive analysing the proposals from CCC. Your report must discuss the likely advantages and disadvantages for your council of each service offering from CCC. (25 marks) Analysis of the Question The question had two specific requirements; an analysis of the proposals from CCC and a discussion of the advantages and disadvantages. Candidates should assume equal marks are allocated for each requirement; hence answers should be planned and structured accordingly. Candidates should note that an answer format is specified in the question, and up to 2 marks are allocated for an appropriate format. Candidates addressed this question based on the information provided in the case study, but often supplemented this information with sensible deductions and inferences from the case study information and from their own studies and knowledge of the realities of the public sector in general and local government in particular. Most candidates presented their response to this question in an appropriate informal report format; and for using this format correctly received up to 2 marks within the overall maximum available of 25 marks. The report should have comprised of both a comprehensive analysis of the CCC proposals and a clear set of recommendations for or against each one of those proposals. The analyses should be based on evidence extracted and inferred from the case, some of which will probably have been considered as part of the response to Question 1. The response should be couched throughout in terms that would be appropriate to the intended audience, which is the CEO of a Council. This element of knowing the audience is key at L6 and the better answers demonstrated this. Candidates drew on evidence from their studies and/or from their own experience in making their points. Better answers also drew on published information and guidance, such as that produced by IDeA and OGC; or from any other published sources, as long as they are sources of direct relevance to the public sector, and the candidate presents them in terms appropriate to the case study organisation. The strongest responses identified at least three or four pieces of evidence justifying each of their recommendations, and fully explained the connections between their recommendations and their evidence. There were no right answers insofar as recommendations both for and against each CCC proposal were in the main equally acceptable; but evidence and justification were crucial for high marks. L6-14/Nov09 SA Report 3

4 Exam Question Summary The majority of candidates were able to gain a pass grade for this answer. Well structured answers related to each of the proposals in turn and identified both the range of financial savings and other efficiency and internal organisational benefits including leverage with suppliers better shared processes, enhanced skills development etc. Candidates also gave good examples of some of the potential disadvantages such as job losses and prioritisation of work to meet the council s requirements. Good responses suggested how to prioritise the offer and options for how the governance of moving forward could be managed. SECTION B Q3 Define the term sustainable procurement and analyse its implications for procurement in the public sector. (25 marks) Analysis of the Question The question had two specific requirements; a definition of sustainable procurement and an analysis of its implications for procurement in the context of the public sector. Candidates should assume equal marks are allocated for each requirement; hence answers should be planned and structured accordingly. Many answers started off with an attempt at a definition. At Level 6 an attributable definition is typically required and better answers gave an attributable definition (normally OGC). Sustainable Procurement can be seen as a process whereby organisations meet their needs for goods, services, works and utilities in a way that achieves value for money on a whole life basis in terms of generating benefits not only to the organisation, but also to society and the economy, whilst minimising damage to the environment. The Procuring the Future paper set the ambitious goal to make the UK a leader in the EU in sustainable procurement by It created a business led task force of 33 members in 2005 with a remit to focus on environmental and sustainability dimensions of procurement and develop a National Action Plan. The Task Force was led by Sir Neville Simms. Some answers, in relation to Simms, discussed the National Action Plan with six recommendations. These are underpinned by three building blocks and it details action to be taken with targets and dates for achievement. An analysis was in the main provided which looked (certainly in the better papers) not only at the advantages outlined above but the costs and challenges that these areas present. Some answers also linked in the Governments sustainable development agenda with the responses to sustainable procurement. L6-14/Nov09 SA Report 4

5 Exam Question Summary A popular question with a number of well explained answers picking up the national agenda, Simms report etc. Better answers also looked at the SME, WOB and BEME benefits, and CSR and social and economic long term benefits being created. Poor answers were very limited to purchasing green products and did not put the subject into context for L6. For such a topical subject area some of the responses were lightweight and brief with very little analysis or evidence of background reading. To counter this however, there were also a number of first rate responses demonstrating a clear understanding of this vital area for the public sector. Q4 Assess key sources of procurement financial and management information (PFMI) in the public sector, and evaluate the risks involved in not having effective PFMI. (25 marks) Analysis of the Question The question has two requirements; an assessment of the key sources of procurement financial and management information (PFMI) and an evaluation of the risks involved in not having effective PFMI. Candidates should assume equal marks are allocated to each requirement; hence answers should be planned and structured accordingly. Firstly answers needed to assess key sources of procurement financial and management information with an analysis of risks involved in not having effective PFMI. Many answers assessed or broke down each part of their selected PFMI available to a procurer and commented on its risks. The question had a wide remit and allowed candidates to specialise on any organisation which they are familiar. The candidates could look at the identification of the PFMI, look at how robust it is, how user friendly it is, all in the context of adequacy and risk. The issue of having good management information was a key area of the NAO report Improving Procurement Any organisation public or private runs many risks if it does not know its business. Public sector organisations require reliable information on procurement and contract spend and supplier performance. Reliable management information used strategically is an important tool that can identify inappropriate buying arrangements that are unlikely to secure value for money. If MI is ignored authorities could face the following risks (not exhaustive); By not monitoring and benchmarking prices paid for key items and services it is impossible to gauge VFM L6-14/Nov09 SA Report 5

6 They risk losing leverage (if they have any) and handing over power to the supplier due to not reviewing the volume of procurement. They will have no idea what constitutes maverick spend Frameworks are unlikely to be utilised as volumes not known. They will be open to fraud as monitoring will be poor Strategy will be unreliable as it will not be backed up by reliable financial information Often MI is used for control of particular functions and activities (e.g. volume discounts) and this will prove difficult Legal challenges could be made (e.g. EU aggregation rules) There are many areas of PFMI to choose, supplier data, spend analysis, GPC spend Treasury data, OGC data, sustainability targets, maverick spend analysis, Idea data, PASA (as was) and other framework data and many more. Exam Question Summary This was not a popular question but most answers were awarded a good pass grade. Better answers gave a good number of sources of internal financial data and included indices and benchmarking. Poor answers only gave internal uses of systems. Most candidates picked up the fraud and potential savings benefits. Some candidates also considered the value of each source and historical nature of it and how to apply it in future decision making. Q5 Review the roles of elected representatives at local, regional and national levels in the governance and oversight of procurement. (25 marks) Candidates reviewed and in some cases analysed the interaction between public accountability, democracy, governance, and the practice of procurement in a range of public sector organisations and a number of impressive responses were given. Good answers also looked at the relevant theories and models in relation to governance and oversight of procurement, with particular reference to the role of elected representatives. Some candidates also contrasted the theories, models, and policies of governance with what they identify as actual practice, and what they have themselves studied and/or encountered in the real world. Candidates could have made wholly explicit the different roles within the different tiers of Government identified in the question, and stronger candidates identified separately the roles of elected representatives at all of the various levels of elected Government: Local Government, Regional Authorities and Government Offices, devolved administrations, and National Government; Good candidates also described the role of elected representatives on other elected managing and governing bodies such as Boards of School Governors, small councils, etc where procurement oversight forms part of the role of those elected. Candidates explained how Public Governance is different from Public Management. L6-14/Nov09 SA Report 6

7 Stronger answers added that democratic public governance and accountability are increasingly important in modern times as speed and technology increase, along with wider trade and therefore more opportunities for poor governance. Good answers gave examples of specific failures and/or successes of good governance by elected representatives (such as procurement champions) to support their review and hence gained high marks. Exam Question Summary Many candidates only discussed one or two of the high levels of governance and could not satisfactorily explain the differences in the tiers. It is important for this stakeholder and governance unit in particular that candidates understand the differences in the professional role and responsibilities for the different levels. Q6 (a) Evaluate the procurement excellence model (PEM) as a method of performance evaluation of public sector procurement. (15 marks) Answers considered the origins of the PEM within the European Foundation for Quality Management ( EFQM ) and explained how it has been transferred from the private to the public sector. Most answers then evaluated the PEM, including areas such as the effectiveness of the transition from its origins, its applicability, ease of use, degree of adoption across organisations within the public sector, scalability, costs v. value, credibility etc. The mechanics and stages of the model were considered and the aspects of Enablers and Results, coming back to Innovation and learning from the EFQM principles also. Better answers addressed these aspects and more, and provided an in-depth critique of the model. Examples and evidence provided gained further marks. Exam Question Summary This was a well answered part of the question with many candidates demonstrating practical public sector experience. Most candidates drew and explained at least a version of the model and then linked it to procurement activities with an attempt at an evaluation, at times with an example and even a mention of PCRs etc. Some candidates gave a descriptive answer rather than evaluating the model and its limitations. Q6 (b) Explain how you would involve stakeholders in a benchmarking exercise comparing the procurement functions of different public sector organisations. (10 marks) L6-14/Nov09 SA Report 7

8 Analysis of the Question This was more than just a benchmarking definition question but was aimed at assessing candidates knowledge of involving stakeholders in a benchmarking exercise comparing the procurement functions of different public sector organisations. Candidates in the main realised that this was not a general benchmarking question; rather, it is a question seeking a specific explanation of how to involve stakeholders in benchmarking exercises. Candidates who wrote all they knew about benchmarking scored a bare pass at best. Better candidates began by explaining how to identify and approach stakeholders, how to evaluate their levels of interest, their needs and their enthusiasm / commitment to the benchmarking exercise. Better answers suggested models for this evaluation, such as Mendelow, and many illustrated this graphically. Candidates could then explain how they would exploit that knowledge to get stakeholder involvement, offering rewards and inducements as feasible and necessary, with better answers explaining the difficulties, especially in the public sector, of giving any tangible rewards to stakeholders, and having to find other means than cash of rewarding participating stakeholders. Candidates should also explain how they might capture and utilise the information gleaned from stakeholders and capitalise on it for current and future benchmarking exercises; and how they would maintain levels of interest and commitment from stakeholders during, and after, the exercise. Exam Question Summary This question was very often the last question answered and the answers were often lacking detail. Most candidates did enough to get half marks however. As mentioned above, candidates quite often used Mendelow matrix to explain how they would engage and communicate with stakeholders. Better answers picked up the long term added value of relationship management and longer term savings. L6-14/Nov09 SA Report 8

9 APPENDIX: Syllabus matrix indicating the learning objectives of the syllabus unit content that each question is testing Question SECTION A SECTION B No Learning Objective a b c a b c a b c a b c a b c a b c 1 Relationships with stakeholders relevant to public procurement 1.1 X 1.2 X Conflict management strategies to resolve differences with stakeholders The significance of changing social and political agendas for public procurement 3.1 X X 4 Governance and oversight arrangements for procurement 4.1 X X 5 Methods and processes of performance evaluation of procurement X X L6-14/Nov09 SA Report 9

10 5.3 L6-14/Nov09 SA Report 10