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Many cities are struggling to implement smart procurement practices, but a new report published by the European Commission provides valuable guidance on how to proceed.

On 15 May 2018, the European Commission released a paper entitled Guidance on Innovation Procurement, which builds a business case for public buyers seeking better ways to contract with urban solutions providers.

Procurement has long been considered anathema to innovation. Only in recent years has best practice theory shifted from the traditional model of selling widgets to servicing cities’ complex needs. Such needs are often interpreted through the catch-all SMAC (social, mobile, analytics and cloud), for which vendors increasingly supply regular services rather than goods. Recently, it is this shift that has produced the concept of procurement ‘as a service’, rather than merely as products purchased.

Public buyers are under increasing pressure to spend budgets wisely. While forward-thinking strategies can help stretch limited resources over multiple competing targets, inter-connectivity empowers an informed public to probe deeper into exactly how much of their taxes are being spent and to what end. Social and environmental standards are also included in peoples’ assessment of overall cost-efficiency. In order to deliver on what the public wants, it is the buying method, not just the receipt of purchase, for which cities are accountable.

“I see a trend of pilot-to-procurement, where cities know what challenge they need to solve, and vendors are willing to offer ‘try before you buy’ test runs so that both parties end up with a satisfactory result,” says David Graham, San Diego’s Deputy Chief Operating Officer for Smart and Sustainable Communities.

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