The digital transformation of public procurement goes beyond replicating existing analogue processes into digital formats. It is reconsidering the whole public procurement process from an end-to-end perspective, including pre-tender and post-tender phases. This chapter provides an overview and conceptual framework for digital transformation, including the data collection, maintenance and use of data and the increasing use of innovative technologies in public procurement. It also describes the close links between digital public procurement and wider public sector digital transformation.
The Digital Transformation of Public Procurement in Ireland
A Report on the Current State
OECD Public Governance Reviews
Abstract
The overarching OECD guiding framework on public procurement, the OECD Recommendation on Public Procurement, highlights the need to invest in technology and to improve the public procurement system by harnessing the use of digital technologies throughout the public procurement cycle (OECD, 2015[1]). The Recommendation invites governments:
to employ recent digital technology developments covering the public procurement cycle to ensure transparency and access to public tenders, increasing competition, simplifying processes for contract award and management, driving cost savings and integrating public procurement and public finance information.
to pursue state-of-the-art digital procurement tools that are modular, flexible, scalable and secure in order to assure business continuity, privacy and integrity, provide fair treatment and protect sensitive data, while supplying the core capabilities and functions that allow business innovation.
The Recommendation also highlights that digital procurement tools should be simple to use and appropriate to their purpose, and consistent across procurement agencies, to the extent possible as excessively complicated systems could create implementation risks and challenges for new entrants or small and medium enterprises (SMEs).
Further, the OECD Recommendation on Digital Government Strategies guides governments in the design and implementation of whole-of government digital transformation reforms that enhance efficiency, inclusion and transparency in the public sector (OECD, 2014[2]). The Recommendation encourages governing and using digital tools and data for human-centred and data-driven service design and delivery and policymaking across different policy areas, including public procurement, by:
defining strategic instruments that guide digital government reforms, fostering alignment across different sectors and promoting wide stakeholder participation and engagement.
securing leadership and political commitment that promote a coherent use of digital technologies and establish effective organisational and governance frameworks to co-ordinate implementation.
establishing policy instruments and mechanisms that support a coherent and strategic decision making, implementation and monitoring of investments in digital technologies across the public sector.
OECD member countries have used digital public procurement to advance a range of goals (see Box 1.1 for a recent example from Czechia). Digital technology can radically change the way public procurement operations are conducted and reported. Technological advances provide governments with increased data and data processing techniques, which can inform robust public procurement strategies, help achieve transaction efficiency, increase transparency, improve risk management and capture data-driven insights on costs and emerging needs (OECD, 2019[3]). Data that allows for better measurement of public procurement outcomes is crucial for accountability and transparency in government spending and, as procurement is increasingly used as a tool to achieve strategic outcomes, provides a means to assess the impact and effectiveness of procurement strategies. Digitalisation also provides increased transparency and accountability, allowing oversight bodies, civil society and the public at large to better track and understand government spending. At the same time, digitalisation should not be pursued for its own sake, but only when it can improve the experience of public buyers and suppliers and can contribute meaningfully to evidence-based policymaking.
Digital transformation of public procurement is an opportunity to drive public procurement priorities, too. For example, it can help increase the uptake of framework agreements and Dynamic Purchasing Systems (DPS), which can lead to more efficient and standardised procurement processes. Digitalisation is already reducing some of the barriers to SME participation in public contracting, making it easier to learn about relevant opportunities and submit tenders. Digitalisation can also help to achieve the Sustainable Development Goals (United Nations, n.d.[4]) by increasing public buyers’ capacity to identify and target opportunities and to measure and report on their results.
Czechia’s digital public procurement strategy 2022-2030 builds on the previous strategy covering 2016-2020, the strategy for the period 2011-2015, and the National Plan for the Introduction of Electronic Procurement for the period 2006-2010. While previous strategies covered five-year periods, the new strategy was extended to nine years due to the long-term nature of its goals. The current strategy is based on four strategic objectives:
1. Simple and efficient procurement: ensuring that the digital public procurement ecosystem allows for the open exchange of data, reducing obligations to provide data and supporting process automation, thus reducing the administrative burden in public procurement, both for contracting authorities and suppliers. This will include ensuring the quality of digital tools across the public procurement ecosystem, introducing uniform registration and logins for contracting authorities and suppliers across systems, and promoting the automatic pre-filling of data by increasing communication between systems.
2. Maximise the transparency of the public procurement market and the openness of systems: ensuring a single high-quality database on the public procurement market, published in open data formats and applying modern data analytics methods. This will include implementing data quality controls, making available machine-readable data beyond mandatory published information, and providing contracting authorities and suppliers with analytical tools to work with their procurement data.
3. Support the successful implementation of innovative e-procurement: supporting public procurement innovation in the framework of digitalisation, including by placing more emphasis on the use of tools, such as e-catalogues, providing support for knowledge sharing, and using innovative technologies such as AI to simplify and automate processes.
4. Cross-cutting measures supporting several strategic objectives: specific measures supporting several strategic objectives at the same time. These include comprehensively updating the e-procurement system architecture and improving the functionality of the main e-procurement platform (Národní Elektronický Nástroj).
In fact, public procurement was one of the first areas where governments promoted the use of digital tools. Historically, the digitalisation of public procurement started with the emergence of digital tools and technologies that supported effective procurement performance. The first genuinely revolutionary changes were related to the introduction and uptake of e-procurement solutions focused mainly on the tendering (pre-award) phase with widespread adoption starting from the mid-2000s. Since then, the rate of change has been astounding, and has continued as other emerging technologies – such as artificial intelligence (AI), robotic process automation (RPA), blockchain, and the Internet of Things (IoT) – have advanced concurrently. Today, the digital transformation journey in public procurement includes a wide range of initiatives from establishing a digital portal to post information about government contract opportunities to using emerging technologies such as AI to analyse data to inform evidence-based decision making and strategic policymaking. As Figure 1.1 shows, digital transformation of public procurement goes beyond simply replicating existing analogue processes into digital formats. It is reconsidering the whole public procurement process from an end-to-end perspective, including pre-tender and post-tender phases, investment in data collection, storage and management and the application of innovative technologies to the procurement process.
Source: Authors’ elaboration.
1.1.1. An end-to-end approach to the public procurement cycle
Digitalisation of the “end-to-end public procurement lifecycle” refers to systems that cover the entire lifecycle of a public procurement procedure, in a digital format and enabling an integrated view from the beginning to the end (see Figure 1.2). It includes all stages of the public procurement procedure starting from preparation and planning up to the final payment phase. This end-to-end approach is critical both for accountability and transparency and to build linkages with contract performance and the broader outcomes of public spending.
Source: Authors’ elaboration.
Digital transformation has enormous potential to remake the public procurement lifecycle from an end-to-end perspective because it can not only optimise the solutions already implemented but also allow for the creation of new added-value services. This approach includes enhancing the adoption of digital tools as well as integrating and managing data to streamline and improve processes at every step.
This end-to-end perspective also entails a user-centric approach, where the focus is on users and their needs rather than on technologies. By understanding and meeting the needs of contracting authorities, Central Purchasing Bodies (CPBs), economic operators, and other users, it is possible to rethink existing processes and procedures via the strategic adoption and use of digital tools and data. Rather than merely digitising existing analogue processes, or upgrading technologies that already support processes, the ambition must be to revisit culture and practices. This involves promoting a culture of understanding of user needs and embracing a bottom-up approach, where the insights and requirements of users, as well as data inputs, inform the transformation process. It requires understanding and responding to user needs, integrating their feedback, involving them in the transformation process, and tailoring digital solutions to address their specific challenges and requirements.
In the pre-tendering phase, which includes the planning and preparation (design) of the tender, digital transformation offers numerous benefits that can significantly enhance the efficiency and effectiveness of procurement processes. Examples include:
Contracting authorities and CPBs can leverage digital tools to conduct market research more effectively, to identify and engage with potential suppliers and to gain insights into market trends and economic operators’ capabilities.
Advanced data analytics can help demand forecasting and strategic procurement planning, ensuring that procurement activities align with actual needs and budgets.
Digital tools (e.g. cloud-based collaboration tools) can facilitate stakeholder engagement and collaboration and the application of a user-centric approach by improving communication between procurement officials and various stakeholders. Contracting authorities can gather valuable feedback from end users and potential suppliers to refine procurement requirements and specifications based on end users’ needs and the opportunities that the market can offer.
The Lisbon Procurement Planning Platform for Innovation and Sustainability (Lx PPP-IS) was developed in 2021 as the backbone for a strategic sourcing approach to sustainability and innovation. The Lx PPP-IS promotes a strategic approach to needs assessment, facilitating the medium-term forecast of goods, works and services needs and the early identification of social, green and economic measures for consideration in future tenders.
The Platform supports needs assessments, allowing the registration of annual needs for goods, works and services, identifying social, green and economic measures to consider in future tenders, promotes annual budget and procurement planning, and identifies Sustainable Development Goals related to public procurement initiatives. The Platform sets sustainability targets at the pre-tendering stage, identifies key areas for sustainability and results in an annual public procurement plan and provides benchmarks and data for monitoring. The PPP follows an internal regulation that defines the mandatory steps in the process, requiring all procurement units to register and categorise their purchasing needs.
By taking an innovative approach to pre-tendering, the Platform turns the annual planning process into a strategic action to promote sustainable innovation that goes beyond the use of green criteria. It promotes a strategic approach by guiding the focus to sustainability and innovation at an early stage, allowing for more focused market engagement and a project-based approach to tenders. This also supports the city’s budget planning, including alignment with the Sustainable Development Goals and climate-neutrality targets.
The tendering phase also benefits significantly from digital transformation. The tendering phase includes the publication of the tender opportunity, submission by potential suppliers, the opening of bids, the evaluation of compliant tenders against the selection and evaluation criteria, the publication of the award notice and the signature of the contract with the successful tenderer. Digital transformation can support decisions regarding supplier selection, promoting greater transparency and accountability in the tendering process. Moreover, data analytics during the tendering phase can support bid evaluation and price analysis. Automated algorithms have the potential to compare bids, detect anomalies, and flag potential instances of bid collusion or fraud, ensuring a fair and transparent evaluation process. This data-driven approach minimises human bias and enhances the integrity of the procurement process, leading to better value for money and improved procurement outcomes. Box 1.3 provides an example from Italy of an eMarketplace that provides operational flexibility for the purchase of low-value purchases, allowing for direct awards from standardised e-catalogues and for requests for quotations from pre-qualified suppliers.
Managed by Consip, Italy’s national CPB, the MePA digital marketplace provides a paperless environment for awarding low-value public contracts for goods, services and maintenance works. MePA encourages economic operators to engage with contracting authorities throughout Italy. Contracting authorities can choose among a wide range of goods and services offered by an increasing number of economic operators. It provides operational flexibility, allowing for direct awards from standardised e-catalogues and for requests for quotations (RfQ).
Contracting authorities can access the MePA e-catalogue, a user-friendly shop window showcasing the goods and services available; easily compare the prices, features and delivery conditions offered by different economic operators; and then proceed with the purchase through direct order or RfQ. The process is split into three steps:
1. Consip publishes the MePA tenders
2. Economic operators qualify and publish their e-catalogues and offers compliant with the tender specifications
3. Contracting authorities issue direct orders or negotiate prices and supply conditions through a RfQ
MePA’s key benefits for contracting authorities include time savings, transparency across the entire procurement process, a greater range of available products with the opportunity to compare prices and characteristics offered by economic operators from across Italy, and the potential to satisfy customised needs by means of an RfQ that identify specific requirements. MePA’s major benefits for economic operators include reduced commercial costs and optimising sales times and wider access to the public procurement market.
Source: OECD (2018[9]), SMEs in Public Procurement: Practices and Strategies for Shared Benefits, OECD Public Governance Reviews, OECD Publishing, Paris, https://doi.org/10.1787/9789264307476-en.
The post-tendering phase, encompassing contract management, performance evaluation, and ordering and payment, can benefit from digital transformation in multiple ways. Contract management can be supported by digital tools, enabling streamlined monitoring and enforcement of contractual obligations. Digital contract repositories and contract management systems allow easy access to contract details, facilitating timely renewals, amendments, and compliance tracking. In real-time, automated performance tracking systems can assess supplier performance against Key Performance Indicators (KPIs). This data-driven approach enables proactive identification of underperforming contracts and timely interventions, ensuring the delivery of goods and services per the agreed-upon terms. More broadly, the data produced by greater digitalisation can be used to measure the impacts of procurement strategies, and answer questions about the impact of government spending on the environment, the economy and society at large. Furthermore, digital transformation can enable better risk management. By integrating risk assessment tools with contract management systems, potential risks such as supplier non-compliance or financial instability can be monitored closely. Early identification of risks allows contracting authorities to take preventive measures, mitigating potential disruptions.
In conclusion, an end-to-end digital transformation approach in public procurement substantially benefits each phase of the procurement life cycle. Governments can achieve greater efficiency, transparency, and accountability in their procurement processes by focusing on data integration, user-centricity, and process automation, leading to improved outcomes and enhanced public value creation.
In the European Union, several initiatives have been implemented to support the process of rethinking the public procurement lifecycle with digital technologies (see Figure 1.3). The EU Public Procurement Directives provide rules on the organisation of procurement procedures and the publication of data generated for public contracts above the EU thresholds. Public buyers at local, regional and national level must publish data on the notification and awards steps of procedures above the EU thresholds on Tenders Electronic Daily (TED) according to the technical specifications provided by the Publications Office of the European Union. The publication obligation however does not currently cover the whole procurement cycle, e.g. in particular the post-tender phases. The EU Public Procurement Directives also require that procurement documents be accessible electronically and a link be included in TED notices, that economic operators submit tenders electronically, and that contracting authorities accept electronic invoices (unless a derogation for sub-central authorities is used).
The European Commission has also developed the European Single Procurement Document (ESPD) which is a single self-declaration form of businesses’ financial status, abilities and suitability for a public procurement procedure. It is available in all EU languages and is used as preliminary evidence of compliance with the requirements concerning exclusion criteria (e.g. criminal convictions, grave professional misconduct) and selection criteria (financial, economic and technical capacity). Tenderers no longer have to provide full documentary evidence and different forms (e.g. attestations, certificates); generally, only the winning economic operator has to present the full set of underlying documentation (unless verification of specific documentation from other participants is needed to ensure a proper conduct of the procedure). Since October 2018 the ESPD has been provided exclusively in an electronic form. The full potential of the ESPD can be reached, however, through the integration of the ESPD with national e-procurement services and the national registers and databases of Members. In this way, the ESPD can act as a ‘business passport’ for companies bidding for tenders anywhere in the European Union. This enables data reusability, default form pre-filling and data interexchange among different databases. In turn, public buyers and suppliers benefit from automation, making the application of the ESPD much easier and decreasing data errors rates (European Commission, 2017[10]).
The eCertis information system helps businesses identify criteria and evidence requested in procurement procedures across the European Union and supports public buyers with the evaluation of bids received from various Members. Economic operators wishing to participate in a public procurement procedure or contracting authorities evaluating bids received from various Members can use eCertis to help understand what evidence is requested or provided by the other party.
Together, the ESPD and eCertis create a basis for the simplification of procedures via the implementation of the once-only principle, a cornerstone of the EU’s Digital Single Market Strategy. The once-only principle refers to the requirement that suppliers should not be asked to provide information to demonstrate that they meet the requirements set out in an administrative procedure, since this information is already available in databases owned by public authorities.
Source: Authors’ elaboration.
1.1.2. Enhancing the collection, maintenance, and use of data
Transparency requirements and the implementation of digital solutions generate a huge amount of data submitted by public buyers and economic operators, but this data holds value only when put to practical use. The digital transformation of public procurement therefore requires investment in public procurement data governance to ensure its effective management, sharing, and use across the entire public procurement system. Because public procurement involves multiple stakeholders who own and use data in different ways, a robust governance framework is also needed. This framework should include clear policies, standards, and data collection, storage, access, and sharing procedures. It should also define roles and responsibilities for data custodians, stewards, and users within the procurement process. A well-defined governance structure will instil trust in the data, promote accountability, and reduce the risk of data misuse.
At the pre-tendering phase, during procurement planning, data-driven insights can help identify procurement needs, forecast demand, and assess market conditions, ensuring that procurement activities align with organisational goals and achieve value for money. With access to high-quality data and analytics, procurement planning becomes more strategic, and evidence based. For instance, by assessing and interpreting contract data, CPBs can identify patterns and potential risks, leading to improved decision making, cost savings, and enhanced procurement strategies. This could include identifying categories of goods and services where new central arrangements could be successful. Data can give economic operators enhanced visibility into market opportunities, improving access and fostering competition.
Throughout the tendering phase, implementing real-time data reporting and monitoring mechanisms allows procurement officials to track the progress of ongoing procurement activities, identify bottlenecks, and take corrective actions promptly. It also provides opportunities to enhance oversight from public bodies such as auditors and competition authorities, as well as from civil society organisations.
Real-time data also aids in measuring procurement performance in the post-tendering phase, and assessing the impact of policies and strategies, such as green, social, and innovative goals. A data-driven procurement enables continuous supplier performance and risk assessment evaluation. By analysing historical performance data and monitoring supplier metrics, procurement entities can identify high-performing suppliers, foster healthy competition, and mitigate potential risks associated with suppliers’ financial stability or past performance issues.
Beyond those directly involved in procurement, the data produced by digital procurement systems can be a valuable resource for auditors and competition authorities, aiding in their assessments. Data can also be used to increase transparency and accountability in procurement processes and in government spending (see Box 1.4 for an example from Slovenia).
In 2022, the Slovenian public procurement system was upgraded with a mechanism to monitor payments under contracts concluded through successful procurement procedures. A portal for entering payments has been created, where contracting authorities report payments made for contracts concluded following successful procurement procedures. The portal is managed by the Public Payments Administration of the Republic of Slovenia.
Beginning in January 2023, contracting authorities are obliged to report monthly on payments made under public procurement contracts through the payments portal. The payments portal connects directly to the public procurement portal. The data uploaded by contracting authorities on the payments portal are transferred back to the procurement portal in the contract file under the relevant contract and allow an overview of the status of contract performance.
Source: Information provided by the Public Procurement Directorate of the Ministry of Public Administration of Slovenia.
Accurate, complete, and timely data is critical, and can be established through data quality checks, validation mechanisms, and data cleaning processes. Adopting standardised data formats and definitions across different procurement systems and departments can also facilitate data integration and analysis. Structured data collection is key for achieving higher data quality and completeness. The use of standardised public procurement notices can help ensure structured, high-quality data. For example, the procurement notices or forms used by public buyers in the European Union to publish procurement notices on TED are standardised. New standard forms, the eForms, were adopted from 25 October 2023, allowing the collection of procurement data in a more structured way. The introduction of eForms will also allow for the capture, over time, of data on the complete public procurement cycle. To that effect, eForms will be extended to include voluntary forms for contract completion notices (i.e. post-tender information such as the final price paid, subcontractors used, actual completion time needed, and complaints received) (see Box 1.5).
eForms are an EU legislative open standard for publishing public procurement data, established under European Commission Implementing Regulation (EU) 2019/1780. They are digital standard forms used by public buyers to publish notices on Tenders Electronic Daily.
By introducing a common standard and terminology, eForms are expected to significantly improve the quality and analysis of procurement data. Well-implemented eForms should increase the ability of businesses and other organisations to find procurement notices, reduce the administrative burden for contracting authorities, increase the ability of governments to make data-driven decisions about public spending, and make public procurement more transparent. The standard forms should be automatically filled-in or generated with information from previous notices, technical specifications, tenders, contracts, national administrative registries, and other sources of data. The use of eForms became mandatory in October 2023.
As the European Commission has emphasised, the eForms Implementing Regulation and its annex do not constitute an ‘off-the-shelf’ law that can be implemented ‘as is’. Public procurement decision makers must first define the national approach to the various aspects of eForms, such as also using them for contracts below thresholds, and defining the national governance structure for eForms.
An ambitious approach to the development of procurement data collection, sharing, and use can provide the basis for a procurement data architecture that facilitates the uptake of digital technologies. For example, in the European Union, the European Strategy for Data commits to a data initiative for public procurement data covering both the EU dimension (EU datasets, such as TED) and national dimension, complemented by a procurement data governance framework.
For the implementation of the European Strategy for Data (European Commission, 2020[12]), the European Commission has issued the Data Governance Act, a cross-sectoral instrument that aims to equip private and public sector institutions to better handle, share and re-use data while respecting fundamental rights and privacy (European Commission, 2023[13]).
European Strategy for Data
The Strategy seeks to make the European Union a leading role model for a society empowered by data to make better decisions in business and the public sector. It seeks to ensure that:
1. data can flow within the European Union and across sectors
2. European rules and values, in particular personal data protection, consumer protection legislation and competition law, are fully respected
3. the rules for access to and use of data are fair, practical and clear, and there are clear and trustworthy data governance mechanisms in place
4. there is an open, but assertive approach to international data flows, based on European values.
Opportunities identified in the Strategy include making public sector data available for the common good, the potential for data sharing between public authorities to contribute to improving policymaking and public services, as well as reducing the administrative burden on companies (once-only principle) and increasing the use of privately held data by the public sector.
The Strategy is based on four pillars:
1. a cross-sectoral governance framework for data access and use
2. investments in data and strengthening Europe’s capabilities and infrastructures for hosting, processing and using data, interoperability
3. empowering individuals, investing in skills and in SMEs
4. common European data spaces in strategic sectors and domains of public interest, including a common European data space for public procurement.
The Strategy acknowledges the importance of public procurement data to increasing transparency, reducing corruption, and improving value for money. It points out that public procurement data is often spread over several systems, made available in different formats, not easily accessible for policymaking, and often low quality. The Strategy commits to a data initiative for public procurement data covering both the EU dimension (EU datasets, such as TED) and national dimension, complemented by a procurement data governance framework.
The Data Governance Act
For the implementation of the European Strategy for Data, the European Commission has issued the Data Governance Act, a cross-sectoral instrument that aims to equip private and public sector institutions for the better handling, sharing and re-use of data while preserving fundamental rights and privacy issues. The Act acknowledges the importance of increasing trustworthy and safe data access and use, for which it sets specific technical requirements for the public sector to ensure the privacy and confidentiality of data in re-use situations (e.g. through anonymisation, pseudo anonymisation or accessing data in secure environments). Similarly, government institutions will need to assist possible re-users to seek consent from individuals to re-use data by other institutions.
The Public Procurement Data Space
The Public Procurement Data Space (PPDS) will connect European databases, including TED data on public procurement, and national procurement datasets available in national portals. It will create an EU-level platform for public procurement data that is currently scattered at EU, national and regional levels. Together with eForms implementation, it is expected to improve data quality, availability and completeness for public buyers, policymakers at EU and national level, companies, researchers and citizens. This data will be combined with an analytics toolset including advanced technologies such as AI.
The PPDS will consist of 4 layers:
1. Data sources layer: a federated network of connected data sources such as the European databases and procurement datasets available in national portals
2. Integration layer: the European e-procurement ontology as a common data format to create a harmonised dataset
3. Analytics layer: capacities for data discovery, querying and data analysis to generate new insights, to make data-driven decisions and to set KPIs on priority policy areas
4. Client layer: a user-friendly interface for different users
The use of the PPDS will be voluntary. EU Member States will be able to connect their national data bases to gain access to the data and analytics on the PPDS. Access to the PPDS will be free of charge for users but countries will be responsible for the costs of digitalising their public procurement systems and connecting their data sources to the PPDS. Countries will also be able to make decisions on whether to participate in the PPDS over time. The European Commission intends to have the basic PPDS architecture and analytics toolkit in place and procurement data currently published at EU level available in the system in 2023. Participating national publication portals would be connected, historic data published at EU level integrated, and the analytics toolkit expanded by the end of 2024. As of 2025, the system could establish links with additional external data sources.
Connecting procurement data across the lifecycle can improve decision and strategy making in areas such as needs assessment and market analysis. Box 1.7 provides an example from the Netherlands of contracting authorities’ efforts to leverage the data from their e-procurement systems to inform their procurement strategies and operational decisions. For efficient data sharing and collaboration, it is vital to implement interoperable systems that can seamlessly exchange data. Application Programming Interfaces (APIs) can enable data interoperability between different procurement platforms and between other key systems that are part of the end-to-end procurement lifecycle, ensuring smooth data flow and eliminating silos.
As data collection and sharing increase, ensuring data privacy and security becomes paramount. Procurement agencies should adhere to strict data protection regulations and implement robust cybersecurity measures to safeguard sensitive information. Encryption, access controls, and regular security audits should be employed to prevent data breaches and unauthorised access to procurement-related data.
TenderNed is the Dutch government’s e-procurement system, managed by the Netherlands Enterprise Agency of the Ministry of Economic Affairs and Climate. All contracting authorities in the Netherlands are obliged to publish contract notices and contract award notices on TenderNed if the value of the contract is equal to or exceeds the EU thresholds. The publication of documents relating to contracts below the EU thresholds is voluntary.
Being the mandatory national e-procurement system, TenderNed has a wealth of public and non-public procurement data. To leverage that data for itself and for contracting authorities, TenderNed has undertaken a number of measures. This includes the technical redesign of its analysis environment to be able to share more real-time information and establishing various output channels for data and analysis sharing. This includes regularly publishing analysis of procurement trends and figures in specific sectors, as well as analysis in more specific areas such as the use of negotiated procedure without publication and common complaints from economic operators.
Under the ‘Data Excellence’ pillar of its 2023-2027 Vision and in line with the Dutch government’s broader digital transformation strategy (the National i-Strategy 2021-2025), TenderNed is seeking to give contracting authorities and the private sector more opportunities to access and use data. Contracting authorities have access to their own data in TenderNed and an API is being made available to contracting authorities to offer them the opportunity to directly link their systems to their own data within TenderNed. Contracting authorities can use this data to answer questions such as:
How long (on average) does the organisation take to complete a tender?
How many respondents are there (on average)?
Which procedures are used most often?
When is the procurement workload of the organisation the highest?
TenderNed also plans to establish data communities with the public and private sectors to share knowledge and expertise.
Source: TenderNed (n.d.[15]), TenderNed website, https://www.tenderned.nl/cms/nl (accessed on 4 October 2023).
1.1.3. Applying emerging technologies
The use of emerging technologies can enhance the public procurement process and improve value for money. Organisations can use these technologies to eliminate repetitive operations to increase productivity and reduce costs, but also to streamline processes and data flows between suppliers and contracting authorities. For instance, AI and user-friendly internet tools can provide stakeholders with real-time access to insights and information. Emerging technologies that improve planning, expedite workflows and processes, and facilitate new platforms for market engagement can ultimately lead to more agile procurement processes that can swiftly adapt to changing demands and market conditions. Box 1.8 includes an example from Austria on how digital tools, in this case an online platform for matching contracting authorities with innovative solutions, can facilitate the use of procurement to promote broader innovation across the public sector and the economy.
The PPPI Service Center (or national competence centre for innovation procurement) was established within the Federal Procurement Agency (BBG), the Austrian federal government’s CPB, in 2013. The PPPI Service Center acts as the single point of contact for pre-commercial procurement and innovation procurement issues in Austria. It also initiates and conducts pilot projects and offers services in the fields of further education and training, in addition to running the innovation platform www.ioeb-innovationsplattform.at. Through the innovation platform, the PPPI Service Center works as a bridge between contracting authorities and innovative companies.
The PPPI Service Center’s innovation platform (Innovationsfördernde Öffentliche Beschaffung, IÖB) publishes the needs of public procurers in the form of Open Innovation Challenges. Recent challenges ranged from climate-friendly and low-emission government boats to AI support in processing rail passenger rights requests. Economic operators can submit their innovative solutions that solve those challenges. This process allows contracting authorities to better understand innovative solutions to prepare for a procurement and have moderated discussions with the market through a clear and fair research process. For economic operators, it provides an opportunity to present solutions directly to public sector buyers and find potential partners for joint ventures.
The platform also contains an online marketplace for innovative companies to showcase their products and services. Solutions that have been tested by expert juries are presented to contracting authorities who use this marketplace for research purposes. For economic operators, the platform provides an opportunity to promote their innovative solutions to over 2 500 public institutions for free. It allows contracting authorities to discover the latest products and pioneering solutions, benefit from pre-selection by an expert jury, and establish direct contact with innovative companies.
Source: IÖB Innovationsplattform (n.d.[16]), IÖB Innovationsplattform website, https://www.ioeb-innovationsplattform.at/ (accessed on 4 October 2023).
However, defining which technologies are “emerging” is difficult because so few of the usual metrics – journal citations, number of researchers in a new field, budgets and products on the market – are readily available. Moreover, many emerging technologies are defined less by the parameters of a particular field (biology, physics, etc.) than by the global challenges they seek to address (the search for new sources of clean energy, the effort to deal with Alzheimer’s disease and dementia in an ageing society, etc.) Furthermore, an emerging technology can quickly become mainstream or disappear altogether depending on its pace of development (Ubaldi et al., 2019[17]).
This report applies the following definition for emerging technologies: “technologies of recent adoption, or currently under development, that offer disruption to the current operating models of government and allow for innovative solutions for public policy and service delivery, and to the socio-economic context overall.” (Ubaldi et al., 2019[17]). Table 1.1 presents an indicative list of emerging technologies that can support public procurement operations.
From the wider perspective of public sector digital transformation, the digitisation of government processes and public services (i.e. transition from analogue to e-government) has progressed significantly over the last few decades. Governments have been working to modernise their working methods and procedures to adapt to new technologies and to changing user needs through large-scale public sector reforms. The final objective of digital transformation is to increase effectiveness and efficiency by harnessing digital technologies.
Digital transformation in the public sector enables governments to rethink processes and services through intense use of digital tools and data, increasing public value in line with broader modernisation efforts (with greater openness, transparency, engagement with and trust in government). This results in the integration of digital technologies and user preferences in service design and the delivery of direct personal services and in shaping public policy outcomes, while contributing to efficiency and productivity gains (OECD, 2016[23]). While the use of digital technologies in the public sector covers a broad spectrum, three levels of maturity can be identified:
1. Digitisation refers to the introduction of digital technologies in public administration, namely by translating analogue information and processes into digital means.
2. Building on digitisation, digitalisation is the process of using digital technology, and the impact it has on business operations (e.g. digitalisation of a process).
3. Digital transformation is a transformative process that helps rethink government processes and services through the integration of digital technologies as essential components in the design and delivery phases (OECD, 2016[23]).
Source: Adapted from OECD (2024[24]), Strengthening Oversight of the Court of Auditors for Effective Public Procurement in Portugal: Digital Transformation and Data-driven Risk Assessments, OECD Public Governance Reviews, OECD Publishing, Paris, https://doi.org/10.1787/35aeab1e-en.
The OECD Recommendation of the Council on Digital Government Strategies underscores the paradigm shift from e-government to digital government required to realise the digital transformation of the public sector. According to the Recommendation, digital government is “the use of digital technologies, as an integrated part of governments’ modernisation strategies, to create public value” (OECD, 2014[2]). While digitisation has undoubtedly led to higher vertical integration within single public sector organisations, policymakers are still confronted with the challenge of fostering the horizontal integration that is enabled by digitalisation but also required to advance coherent digital transformation (OECD, 2021[25]).
While digitalisation emphasised transferring analogue and paper activity to the internet, the concept of digital transformation proposes a paradigm shift focused on re-engineering and re-designing processes and interactions through digital-era working practices, smarter use of data, and the appropriate use of technology. Digital government practices ensure public services are designed and delivered such that the benefits of digital transformation are available to and accessible by all, including those who rely on face-to-face interactions. That means looking inwards to address the context and governance (including administrative structures, culture, capability and processes) and outwards, to focus on the needs of users throughout their experience of a public service – whether some, or all, of that service is delivered via mail, telephone, in-person or through a digital device (OECD, 2020[26]; OECD, 2021[25]).
Digital public procurement is closely linked to digital government. Issues related to whole-of-government policies and initiatives such as the ‘'once-only principle’' in public administration – a cornerstone of the EU’s Digital Single Market strategy – and digital identity are two examples of core digital government tools that inform the digitalisation of government functions and services.
Integration or interoperability of e-procurement systems with other governmental platforms is essential to achieving full visibility on the use of public funds and to the development of a comprehensive public procurement performance measurement framework. Integration or interoperability with other digital government systems – such as public finance management, budgeting, human resources management, social security databases, justice, business and (central and local) tax registries, auditing, and enterprise resource planning (ERP) –can provide a comprehensive picture of the procurement function, increase efficiency and accountability, and enable the government to develop innovative and impactful procurement strategies. a lack of integration or interoperability between systems can increase the administrative burden for users (with the multiple input of the same information in several systems), reducing the expected efficiency gains from digitalisation.
In this context, there are two categories of integrations to consider: horizontal integration and vertical integration (see Figure 1.5). Vertical integration refers to the integration of the national e-procurement system with the internal digital procurement and management tools of contracting authorities. Horizontal integration involves integrating the e-procurement system with other governmental systems such as the national tax system, the national budgeting/accounting system, or the national social security system.
Source: OECD (2018[27]), Mexico's e-Procurement System: Redesigning CompraNet through Stakeholder Engagement, OECD Public Governance Reviews, OECD Publishing, Paris, https://doi.org/10.1787/9789264287426-en.
Data sharing and interoperability can help advance the use of public procurement data in service delivery and policymaking. Without interoperability between the different systems, however, digitalisation can result in increased work, error propagation and inconsistent data. Registering the same data in multiple systems creates administrative burden for users in addition to risks in terms of fragmented and incoherent information.