Awarded success Story with the Dunedin City Council

Dunedin City Council, New Zealand, www.dunedin.govt.nz

The Dunedin City Council won an award for Outstanding Cooperation & Collaboration at the 2023 World Commerce and Contracting (Asia Pacific) Innovation and Excellence Awards – Congratulations!

“ I’ve awarded many, many contracts, but I’ve never been hugged by a vendor at the end of it, when I told him that he won the contract. That tells you something.
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— Serge Kolman, Procurement & Contracts Manager, Dunedin City Council

The award was for a Lean-Agile Procurement (LAP) process the Dunedin City Council (DCC) undertook to source a Contract Lifecycle Management System, and the outstanding way DCC and the successful vendor/partner, Portt, collaborated through the lean-agile process to achieve their goals.

Procurement at Dunedin City Council

The Dunedin City Council represents the people that live in Ōtepoti Dunedin, New Zealand. The DCC’s purpose is to enable decision making by and on behalf of communities, and to promote social, economic, environmental and cultural wellbeing.

Public dollar spend makes up a significant proportion of the NZ economy, including spend from local government organizations like DCC. The DCC has an important responsibility to ensure it spends rate payers funds prudently through its procurement processes – in an open, transparent and accountable way. DCC follows the NZ Government Rules of Procurement. When procuring Goods or Services, they use the NZ Government Electronic Tendering Site (GETS) to list all open market tenders. This site enables registered users to electronically review and respond to all current open market tenders being conducted by the Council.

One of DCC’s procurement rules is that procurement with a cumulative value of over $100,000 requires an open and competitive process, which typically takes over three months.

Why Dunedin City Council used a Lean-Agile approach

Previously, DCC had faced challenges sourcing Software as a Service (SaaS) through a traditional open market Request for Proposal (RFP) approach, with a few complex SaaS contracts resulting in vendor/partners that could not deliver on requirements.

The DCC was going through a Contract Management improvement project, which included sourcing a Contract Lifecycle Management (CLM) system and wanted to ensure the same situation did not occur again as with previous SaaS procurements. This was a strategically important project for DCC, and therefore success was paramount.

It was important that the CLM system sourced met the Council’s requirements to ensure the success of the wider Contract Management improvement project.

When DCC was looking for a way to maximize the success of the procurement process to ensure the right outcomes were achieved, they began looking into the Lean-Agile Procurement approach as an option.

Dunedin City Council’s Lean-Agile Approach

To source the CLM system, DCC decided the contract was complex enough to use a Lean-Agile Procurement approach.

DCC undertook a two stage procurement process.

Stage one was an open market Registration of Interest, using GETS(fn). This was done for two reasons:

1. To comply with DCC’s Procurement and Contract Management Policy.

2. We didn’t know what we didn’t know and didn’t want to miss out on new or emerging technology that we hadn’t uncovered through our market research (aka we had FOMO!).

Following stage one, DCC shortlisted three vendor/partners for the second stage of the CLM Software procurement.

Stage two was a two day workshop ‘Big Room Event’ utilizing Lean-Agile Procurement techniques. As it was DCC’s first Lean-Agile Procurement process, we engaged Ross Darrah from Pareto Toolbox, as an expert in LAP, to assist and coach the DCC team through the process.

Image source: Dunedin City Council - DCC and Pareto Toolbox presenting to Lean Agile Procurement Canvas during the DCC LAP Process.

It was acknowledged that LAP was a new process for vendor/partners and DCC stakeholders, and particularly as this was being conducted in a public sector environment, probity was absolutely crucial. The DCC team and vendor/partners were therefore coached and fully briefed on LAP, to ensure full understanding of the process and to give confidence to all stakeholders and vendor/partners that they were involved in a ‘safe’ process which was fair, transparent and complied with required public sector regulations and probity standards.

The DCC team fully embraced the LAP process and focused during the two days on getting to know the shortlisted vendor/partners. It was important for DCC to understand how the respective vendor’s approach would work for DCC and the capabilities of their CLM solutions.

During the two days of the LAP process, DCC and shortlisted vendor/partners approached the event as an opportunity to start building the relationships.

Business Outcomes Achieved using the Lean-Agile Approach

In adopting a Lean-Agile Procurement approach, DCC achieved accelerated decision making and cut down the time and cost required for vendor/partners to do business with DCC. It also enabled strong relationship building between DCC and the successful vendor/partner – setting a solid foundation for the delivery of the work.

Image source: Dunedin City Council - Serge Kolman, DCC Procurement and Contracts Manager presenting to vendor/partners on day one.

The CLM solution was delivered on time and within budget. The success of this contract can be attributed to the innovative procurement approach, effective project delivery, and the willingness of DCC staff to try new ways of working that benefit DCC, its vendor/partners, and the Dunedin communities they work for.

There were some doubts voiced by vendor/partners prior to the event, as this was the first Lean-Agile process DCC and the vendor/partners had participated in. However, the feedback from staff and all vendor/partners involved was overwhelmingly positive - even from the vendor/partners who were not successful!

Key Learnings, Tips and Takeaways

Investment Logic Mapping

Once the CLM software contract was awarded, and as part of the implementation phase, DCC undertook an investment logic mapping (ILM) process with the successful vendor/partner, Portt.

The ultimate aim of the ILM process was to get to the core of the problems we are trying to solve by developing problem statements and identifying the benefits of solving those problems.

Image Source: Dunedin City Council. - Natalie Strong, DCC Procurement Advisor and LAP facilitator updating the LAP canvas during canvas review with DCC staff and shortlisted vendor/partners.

DCC found this process valuable, and they would in future undertake an ILM exercise with key staff and stakeholders before they went through a Lean-Agile Procurement process, as this would inform the canvas (true north) and User Stories by developing problem statements and can be used to measure success of Lean-Agile process.

Working with Vendor/Partners to solve Problems

DCC found it very valuable to have the ability to talk through issues and challenges with vendor/partners, who then demonstrated how they could help solve these problems in real time.

Two Days vs Three Days

DCC felt like they would benefit from one more day, to feel less rushed.

A great outcome can be achieved by doing a Lean-Agile process in two days, but DCC felt like they would get a bit more out of the process if an extra day was included.

Online vs In-Person

Lean-Agile Procurement works best with people in the room, online presence is fine but to be really successful DCC found that physical presence was best.

Tips for other Procurement Leaders

Embrace the process. DCC have found Lean-Agile Procurement to be a really useful tool to have in the procurement toolbelt for the right project.

Ensuring you engage early with decision makers within your environment is essential to the success of the process. Engage early to enlist the support you need (including from decision makers with financial authority) and to enable and achieve the full benefits and potential of a Lean-Agile process.

Time Management & Peer Feedback

A key learning from the Lean-Agile Procurement event was the importance of time management. As already stated, there was a lot to achieve in two days, meaning that sticking to agreed timeframes was of utmost importance. To mitigate this challenge, we ensured that vendor/partners were clear about timeframes up front and this was reinforced throughout the event. In addition, vendor/partners (and DCC stakeholders) were kept on time by using a timer and alarm. This ‘refereeing’ of the event ensured that the time was maximized.

The strict keeping of time added an additional benefit. It ensured there was sufficient time to provide immediate feedback to vendor/partners to ensure they knew where they stood and made the event a success. This also ensured respect was given to vendor/partners, that is they were held to time but they were provided with feedback on where they needed to improve.