Performance-based Contracting: Coming to a County Near You

Performance-based contracting – where vendor performance factors into procurement decisions, along with price – can provide a local government with better value, reports GoverningWhile larger jurisdictions have used performance-based contracting for years, more and more local governments are incorporating the sophisticated procurement method into their practices – thanks to increased access to data.

From Governing:

With a population of more than 452,000, Virginia Beach is the largest city in the state. But when [Chief Procurement Officer Taylor] Adams took office in September 2015, the city was still handing out contracts the traditional way, by mostly angling for the lowest price. Subsequently his team conducted a top-to-bottom assessment of Virginia Beach’s procurement practices; by December, it was clear that if the city wanted better procurement, it needed better data.

“We had to build a more consistent output before we started addressing the quality issue,” Adams says.

So Virginia Beach has embarked on a $2 million, five-year effort to overhaul its purchasing processes. The city’s new electronic procurement system will allow it to better track transactions and maintain records—something most cities already do with an e-procurement tool. But Adams envisions a program that helps the organization make decisions, too. “There are a lot of cities deploying e-procurement tools now, but most use them for just a tactical function,” he says. “We, on the other hand, want to manage data to help make decisions. It moves procurement from an order-and-payment function to a strategic one.”

Find out about reforms to county procurements here in Maryland during the MACo Winter Conference session, Buying Into Your Buyers: How to Save Money, Stay Out of Trouble, and Keep Your Procurement Officer Happy, on Wednesday, December 6, 2017, from 1:30 pm to 2:30 pm.

The MACo Winter Conference will be held December 6-8, 2017 at the Hyatt Regency Chesapeake Bay Hotel in Cambridge, Maryland. This year the conference’s theme is “The Power of Partnership.”

Learn more about MACo’s 2017 Winter Conference: