Public sector procurement leaves small suppliers out in the cold

Members of the Independent Consultants Group (ICG) are well aware of the frustration experienced by UK market researchers with the public sector tendering system - in particular pre-qualification questionnaires (PQQs).

But new recommendations designed to help SMEs win public sector business risk making things worse if they don’t take account of the objectives of market research projects and the skills required to achieve them.

The general impression among ICG members seems to be that, rather than encouraging SMEs, the procurement process excludes them. Paul Hutchings of Kindle Research has called the PQQ system “a bewildering, frustrating and time-consuming process”.

Ben Lovejoy of Plug and Play Research said: “Procurement departments are excellent at negotiating good deals on widgets, but have absolutely no idea what makes a good research agency and thus they can’t design a process to find out.”

Last year the government asked a committee led by Anne Glover of Amadeus Capital Partners to look into how to make it easier for SMEs to supply the public sector, and to consider introducing a target for SMEs to win 30% of public sector business within the next five years.

The committee’s report, published last November, was welcomed by the government and work has commenced on implementation. Among the recommendations being considered is that “qualification criteria should be standardised and incorporated in all pre-qualification questionnaires”.

This raises two vital questions. What are the most relevant qualification criteria for public sector market research projects? And how do we make sure that the people deciding whether potential suppliers meet them are themselves suitably qualified?

Many of the PQQ criteria not only automatically exclude almost all independent market research consultants, but also other small to medium-sized market research agencies.

Questionnaires commonly include requirements for an equal opportunities policy, an environmental policy, ISO 9000 accreditation, compliance with health and safety regulations in the workplace, submission of three or more years’ annual accounts, and very high levels of professional indemnity and public liability insurance. Our view is that these criteria are irrelevant to the great majority of market research suppliers.

We suggest that the following criteria be included as standard – on the grounds that they are  relevant and inclusive of suppliers of all sizes:

• Evidence of prior working experience of similar projects
• Demonstration of the ability to select the correct methods and techniques to meet the stated objectives of the project
• Demonstration of how the findings arising from the recommended methodology will be both accurate and reliable so that decisions can be confidently based upon them
• Showing how a supplier’s recommended methodology will add value and/or insight
• Relevant formal educational and/or professional qualifications of the candidate(s) or project manager(s)
• Provision of costs that represent best taxpayer value, but which may not necessarily be the lowest costing submitted.

Unfortunately public sector procurement departments do not always have the knowledge or experience to assess market research competencies. They are therefore often not qualified to make objective judgements about the best suppliers to invite to tender. In practice, procurement departments look to see whether PQQ boxes are ticked, rather than make quality-of-service judgements.

We believe that those best able to make a fair assessment of both PQQ submissions and resultant tender applications are those public sector personnel who will use the research outputs. Ideally the same staff will also have some understanding of market research methodology but, if they do not then external assessors should be hired from within the market research industry to provide this experience – as already happens in many private sector client organisations.

Failing to address these issues would deny the public sector the opportunity of being supplied by some of the most highly skilled and experienced market research experts in the country.