Juggling competing public values : resolving conflicting agendas in social procurement in Queensland

Organisations within the not-for-profit sector provide services to individuals and groups government and for-profit organisations cannot or will not consider. This response by the not-for-profit sector to market failure and government failure is a well understood contribution to society by the nonprofit sector. Over time, this response has resulted in the development of a vibrant and rich agglomeration of services and programs that operate under a myriad of philosophical stances, service orientations, client groupings and operational capacities. In Australia, these organisations and services provide social support and service assistance to many people in the community; often targeting their assistance to clients facing the most difficult of clients with complex problems. Initially, in undertaking this role, the not-for-profit sector received limited sponsorship from government, relying on primarily on public donations to fund the delivery of services. (Lyons 2001). Over time governments assumed greater responsibility in the form of service grants to particular groups: ‘the worthy poor’. More recently, government has engaged in widespread procurement of services from the not-for-profit sector, which specify the nature of the outcomes to be achieved and, to a degree, the way in which the services will be provided. A consequence of this growing shift to a more marketised model of service contracting, often offered-up under the label of enhanced collaborative practice, has been increased competitiveness between agencies that had previously worked well together (Keast and Brown, 2006). One of the challenges which emerge from the procurement of services by government from third sector organisations is that public values such as effectiveness, efficiency, transparency and professionalism can be neglected (Jørgensen and Bozeman 2002), although this is not always the case (Brown, Furneaux and Gudmundsson 2012). While some approaches to the examination of social procurement - the intentional purchasing of social outcomes (Furneaux and Barraket 2011) - assumes that public values are lost in social procurement arrangements (Bozeman 2002; Jørgensen and Bozeman 2002), alternative approach suggest such inevitability is not the case. Instead, social procurement is seen to involve a set of tensions (Brown, Potoski and Slyke 2006) or a set of trade offs (Charles et al. 2007), which must be managed, and through such management, public values can be potentially safeguarded (Bruin and Dicke 2006). The potential trade-offs of public values in social procurement is an area in need of further research, and one which carries both theoretical and practical significance. Additionally, the juxtaposition of policies – horizontal integration and vertical efficiency – results in a complex, crowded and contested policy and practice environment (Keast et al., 2007),, with the potential for set of unintentional consequences arising from these arrangements. Further the involvement of for-profit, non-profit, and hybrid organisations such as social enterprises, adds further complexity in the number of different organisational forms engaged in service delivery on behalf of government. To address this issue, this paper uses information gleaned from a state-wide survey of not-for-profit organisations in Queensland, Australia which included within its focus organisational size, operational scope, funding arrangements and governance/management approaches. Supplementing this information is qualitative data derived from 17 focus groups and 120 interviews conducted over ten years of study of this sector. The findings contribute to greater understanding of the practice and theory of the future provision of social services.

Sustainable infrastructure procurement in Australia : standard vs. project practices

The Australian Government and most Australian road authorities have set ambitious greenhouse gas emission (GHGe) reduction targets for the near future, many of which have translated into action plans. However, previous research has shown that the various Australian state road authorities are at different stages of implementing ‘green’ initiatives in construction planning and development, with considerable gaps in their monitoring, tendering, and contracting. This study illustrates the differences between procurement standards and project specific practices that aim to reduce GHGe from road construction projects in three of the largest Australian road construction clients, with a focus on the tools used, contract type and incentives for better performance.

New and young firms Entrepreneurship policy and the role of government – evidence from the Federation of Small Businesses survey

Purpose – The purpose of this paper is to investigate whether new and young firms are different from older firms. This analysis is undertaken to explore general characteristics, use of external resources and growth orientation. Design/methodology/approach – Data from the 2008 UK Federation of Small Businesses survey provided 8,000 responses. Quantitative analysis identified significantly different characteristics of firms from 0-4, 4-9, 9-19 and 20+ years. Factor analysis was utilised to identify the advice sets, finance and public procurement customers of greatest interest, with ANOVA used to statistically compare firms in the identified age groups with different growth aspirations. Findings – The findings reveal key differences between new, young and older firms in terms of characteristics including business sector, owner/manager age, education/business experience, legal status, intellectual property and trading performance. New and young firms were more able to access beneficial resources in terms of finance and advice from several sources. New and young firms were also able to more easily access government and external finance, as well as government advice, but less able to access public procurement. Research limitations/implications – New and young firms are utilising external networks to access several resources for development purposes, and this differs for older firms. This suggests that a more explicit age-differentiated focus is required for government policies aimed at supporting firm growth. Originality/value – The study provides important baseline data for future quantitative and qualitative studies focused on the impact of firm age and government policy.

Project governance : ethical decision making in project procurement in the Malaysian public sectors

Managing public sector projects in Malaysia is a unique challenge. This is because of the ethical issues involved during the project procurement process. These ethical issues need attention because they will have an impact on the quality, cost and time of the project itself. The ethical issues here include conflict of interest, bid shopping, collusive tendering, bid cutting, corruption and the payment game. In 2006, 17.3% of 417 Malaysian government contract projects were considered sick due to contractors' performances that failed to conduct the project according to the project plan. Some of the sick projects from these statistics are due to the ethical issues involved. These construction projects have low quality due to the selection of the contractors, done unethically due to personal relationships instead of professional qualifications. That is why it is important to govern the project procurement processes to ensure the accountability and transparency of the decision making process to ensure that these ethical issues can be avoided. Extensive research has been conducted on the ethical issues in the tendering process or the award phase of project management. There is a lack of studies looking at the role of clients, including the government client, in relation to unethical practice in project procurement in the public sector. It is important to understand that ethical issues not only involve the contractors and suppliers but also the clients. Even though there are codes of ethics in the public sectors, ethical issues still arise. Therefore, this research develops a project governance framework (PGEDM) for ethical decision making in the Malaysian public sectors. This framework combines the ethical decision making process together with the project governance principals in guiding the public sectors with ethical decision making in project procurement. A triangulation of questionnaire survey and Delphi study was employed in this research to collect required qualitative and quantitative data. A questionnaire survey was conducted among the public officials (the practitioners) who are currently working in the procurement area in the Malaysian public sectors, in identifying the ethical behaviours and factors influencing further ethical behaviour to occur. A Delphi study was also conducted with the assistance of a panel of experts consisting of practitioners that have expertise in the area of project governance and project procurement as well as academician, which further considered the relationship and the influence of the criteria and indicators of ethical decision making (EDM) and project governance (project criteria, organisational culture, contract award criteria, individual criteria, client's requirements, government procedures and professional ethics). Through the identification and integration of the factors and EDM criteria as well as the project governance criteria and EDM steps for ethical issues, a PGEDM framework was developed to promote, and drive consistent decision outcome in project procurement in the public sector. The framework contributes significantly to ethical decision making in the project procurement process. These findings not only give benefit to the people involved in project procurement but also to the public officials in guiding them to be more accountable in handling ethical issues in the future and to have a more transparent decision making process.

Evaluation framework for green procurement in road construction

Purpose Most barriers and enablers of sustainable projects are related to procurement. This study proposes a framework for evaluating green procurement practices throughout the lifecycle of road construction projects and demonstrates its application through an Australian case study. Design/methodology/approach The study is based on linking the phases of road construction with incentive mechanisms for proactively motivating behavioural change. A holistic view on utilised and potential incentives is attempted with a literature review and a state-of-practice review. The latter is based on interviews and 90 policy and procurement documents across five Australian states. Findings An evaluation framework with seven procurement stages is suggested to describe current state green procurement incentives throughout the delivery lifecycle of road construction projects. The Australian case study was found to provide useful data to identify gaps and strong points of the different states regarding their level of integration of sustainability and greenhouse gas emissions GHG) reduction elements in their procurement practices. This understanding was used to draw recommendations on future advancement of green procurement. Originality/value: Government entities across the globe can impact considerably the achievement of sustainability and GHG targets, by using their procurement practices and requirements to create incentives for contractors and suppliers to engage in more GHG conscious practices. The present study provides a systematic account of how green procurement practices can be underpinned using the Australian road construction industry as a case study, and distinguish between strong and weak links in the green procurement chain to draw recommendations for future initiatives.

Purchasing social good(s): A definition and typology of social procurement

Social procurement has gained attention in modern public management; however, considerable differences exist in understanding what social procurement actually is. Divergent definitions of social procurement inhibit effective policy implementation, and can result in imprecision in empirical research. This paper develops a typology of social procurement implementation, and advances a coherent single definition of social procurement. Clarifying the intent and approaches to social procurement will assist policy implementation and empirical evaluation.

The effect of procurement on competition and flexibility : determining the suitability of public-private partnerships in major infrastructure projects

A procurement decision-making model is developed based on a novel integration of leading-edge microeconomic theory and empirically tested in major road and health projects. The model provides a more reliable approach to identifying projects suited to Public-Private-Partnerships (PPPs) and it is expected that the model will enable government to deliver improved value-for-money from their portfolio of PPP projects.

Reforming the procurement of construction and financing of Australian infrastructure : advancing capacity, competition and investment

Funded by an Australian Research Council (ARC) Linkage grant over four years (2009–13), the Major Infrastructure Procurement project sought to find more effective and efficient ways of procuring and delivering the nation’s social and economic infrastructure by investigating constraints relating to construction capacity, competition, and finance in new public sector major infrastructure.1 The research team comprised researchers in construction economics and finance from Queensland University of Technology (QUT), Griffith University (GU), The University of Hong Kong (UHK), and The University of Newcastle (UoN). Project partners included state government departments and agencies responsible for infrastructure procurement and delivery from all Australian mainland states, and private sector companies and peak bodies in the infrastructure sector (see “Introduction” for complete list). There are a number of major outcomes from this research project. The first of these is a scientifically developed decisionmaking model for procurement of infrastructure that deploys a novel and state-of-the-art integration of dominant microeconomic theory (including theories developed by two Nobel Prize winners). The model has been established through empirical testing and substantial experiential evidence as a valid and reliable guide to configuring procurement of new major and mega infrastructure projects in pursuance of superior Valuefor- Money (VfM). The model specifically addresses issues of project size, bundling of contracts, and exchange relationships. In so doing, the model determines the suitability of adopting a Public-Private Partnership (PPP) mode.

Sustainability Non-Price Incentives and Rewards: A Collaborative Procurement Perspective

Construction scholars suggest that procurement processes can be used as mechanisms to change construction industry practices. This paper discusses industry changes as a response to the calls for integration of sustainability ideals into construction practices. Because major infrastructure construction has been identified as a key producer of greenhouse gas emissions (GHGE), this study explores collaborative procurement models that have been used to facilitate mitigation of GHGE. The study focuses on the application of non-price incentives and rewards that work together as a binary mechanism. Data were collected using mixed-methods: government document content analysis was complemented with data collected through focus groups and individual interviews with both clients and contractors. This report includes examples of greening procurement agendas for three Australian road authorities relating to collaborative procurement project delivery models. Three collaborative procurement models, Alliance Consortium, Early Contractor Involvement and Public Private Partnerships provide evidence of construction projects that were completed early. It can also be argued that both clients and contractors are rewarded through collaborative project delivery. The incentive of early completion is rewarded with reduction of GHGE. This positive environmental outcome, based on a dual benefit and non-price sustainability criteria, suggests a step towards changed industry practices though the use of green procurement models.

Nonprofit Service Delivery for Government : Accountability Relationships and Mechanisms

When government purchases social services under contract from a nonprofit organisation, a clear accountability relationship is created. The NPO must give an account for the use of the funds and achievement of outcomes to the funder. This paper explores how accountability is enacted in two different types of funding relationships in Queensland. Support is found for the argument that different relationships have different approaches to accountability.

Developing green procurement framework for construction projects in Malaysia

With the current emerging development pattern in Malaysia, Malaysian government has enthusiastically promoted green procurement approach that will help the construction project being green. Previous studies highlighted that the concept of green procurement is still very new to the Malaysian construction industry, and this increases the needs for further research in this area. This paper addresses the needs of guidelines for stakeholders to procure environmentally-friendly construction. Currently, there is a limited practical guideline for stakeholders to procure green projects. This paper discusses the progress to date of a research project aimed at developing a green procurement framework for construction projects in the Malaysian construction industry. This framework will guide the stakeholders to plan the green procurement implementation to procure a construction projects. Through literature and expert opinion, this paper explores the list of green practices within procurement practices which becomes the basis to develop a survey instrument that will be used in the later part of this study. The paper will shed useful information for construction researchers and practitioners in exploring the green procurement concept for construction industry in Malaysia.

Social Procurement and New Public Governance

Taking a critically informed approach, this innovative text examines emerging approaches to social procurement within the context of New Public Government (NPG), and examines the practices of social procurement across Europe, North America and Australia. Considering both the possibilities and limitations of social procurement, and the types of value it can generate, this book also provides empirically driven insights into the practicalities of 'triple bottom line' procurement, the related challenges of measuring social value and the management of both the strategic and operational dimensions of procurement processes. As such it will be invaluable reading for all those interest in social services, public governance and social enterprise.

Procurement-related critical factors for briefing in public-private partnership projects: Case of Hong Kong

Public private partnerships (PPP) are widely used for construction project procurement. However, the briefing stage of PPP projects has been largely overlooked, although it has a far-reaching influence throughout the project life cycle. In response, we rectify this by exploring the critical factors involved. A set of 15 procurement-related factors are first identified from the existing literature. Then the effects of four background variables on the factors are tested with Hong Kong government data by an exploratory factor analysis extracting four major dimensions. The relationships between these dimensions and background variables indicate the need to take the background variables into account when ranking the factors. The ranking of the factors is then obtained by considering their weighted importance. Finally, the final practical value of the results is discussed.