7. Improve the World Bank's procurement outcomes in ICT projects and ICT components by (i) building ICT expertise and knowledge among procurement specialists (ii) adapting procurement rules to reflect sector specificity and the growing use of public-private partnership&ndash type approaches and (iii) ensuring the design of consistent procurement procedures to facilitate effective collaboration between technical staff and procurement specialists, including by upstream engagement of procurement specialists during project preparation.abc
- ICT procurement has been highlighted as a major implementation constraint in several country and Regional portfolio reviews and is a critical dimension of design. Procurement issues can be reduced by careful procurement planning at entry and early involvement of procurement specialists. Staff have highlighted the lack of specialists with expertise in IT procurement. World Bank procurement rules were designed for infrastructure
projects, which separate goods and works from consulting service. This approach has not been useful for IT contracts, especially large ones, which usually require combined procurement because of the change management that accompanies adoption of IT.
- World Bank task team leaders expressed the view that the Bank's approach to procurement has been inconsistent, in both substance and process:
different departments provided different advice to the same government. The process is complex and long: Bank procurement requirements take an average of 27 months to complete, and this is coupled with the lack of capacity in countries to use procurement contracts.
Original Response: Management agrees with the overall objective of improving procurement outcomes in ICT projects and components. Improving ICT implementation bottlenecks needs a simultaneous focus on enhancing client capacity, early discussion on procurement and contract management risks, and making available requisite technical skills and procurement expertise within the Bank task teams. The Bank is exploring opportunities to simplify procurement and technical procedures and to identify and address resource gaps, if any. The Procurement Guidelines were revised in January 2011 to include ICT -specific approaches (e.g., framework contracts) and procurement methods to reflect the complexities of ICT system design and development (e.g., use of brand names, nonprice factors for bid evaluation). The provisions related to public-private partnerships have been amended to provide flexibility to accommodate public-private partnership procedures, and are supported by guidance notes to help staff apply the flexible interpretation. To better support the needs of ICT projects, an ICT procurement working group has been formed and is updating training materials for procurement staff to focus on ICT procurement risk management, and is also reviewing and updating the ICT -specific standard bidding documents and staff guidance. The Bank leads a dedicated multilateral development bank working group on ICT procurement that has achieved significant results in recent years, including harmonization of bidding documents and guidance notes. The reviews of large and complex ICT procurement contracts (where most issues are present) are channeled through the most experienced procurement officers (the Regional procurement office and Operational Procurement Review Committee). With respect to coordination among Bank units, management recognizes the importance of providing consistent advice to clients in relation to technical and procurement aspects and of engaging technical and procurement expertise early in the design discussions. This will be emphasized in the task team leader guidelines referred earlier.
Simplify and improve procurement procedures in collaboration with SDNâs ICT Sector Unit, OPCSâs Procurement Group and regional OS units
Indicators:
⢠Update guidance notes on ICT procurement
⢠Update the Standard Bidding Documents for larger ICT systems
Timeline: FY14
Build expertise and knowledge amongst procurement specialists on ICT
Indicators:
⢠Number of procurement staff with ICT expertise
Baseline and Target: Establish in FY13
Timeline: FY16
IEG notes that the Bank's new Procurement Policy for Investment Project Financing (IPF) went into effect on July 1, 2016, the new procurement policy applies to all the sectors including ICT. IEG also takes note that a virtual team of ICT procurement experts supported by broader CoPs was built up. IEG expects to receive updates on the effectiveness of the new procurement framework on the procurement in ICT sector. IEG would appreciate receiving the baseline and targets of Action L to be established as soon as possible.
***See full update attached**
The Bank's new Procurement Policy for Investment Project Financing (IPF) was approved by the Board on July 21, 2015 to modernize the Bank's procurement policy and maximize the strategic role of procurement in achieving key development effectiveness goals, and the NPF, --consisting of the Procurement Policy, Directive, Procedure, and the World Bank Regulations for IPF Borrowers (Procurement Regulations), went into effect on July 1, 2016.
Mandatory for all operations with concept reviews after the aforementioned date, the NPF has reflected the relevant recommendations from IEG and has ensured that it follows a fit for purpose/value for money approach offering more choice and new procurement methodologies, including those that better support information systems or ICT procurement such competitive dialogue, use of negotiations, best and final offers etc.
In addition, under the NPF the selection of public-private partnerships is now based on criteria that best meet the project development objectives and achieve project outcomes that are acceptable to the Bank, in contrast to the previous process-oriented approach. Annex XIV of the Procurement Regulations specifies requirements and provides guidance on (i) the scope of the Bank's review of private investor procedures and of standards acceptable to the Bank (ii) the project assessment and structuring requirements that the borrower should meet before selecting the private partner (iii) the arrangements and requirements for selecting the private partner, clarifying that, among other things, these should be consistent with the Bank's Core Procurement Principles (iv) treatment of unsolicited proposals and (v) allowing the private partner to procure goods in according with its own procedures if those procedures are in consist with the Bank Core Procurement Principles.
Furthermore, Management has published the Request for Proposals (RFP) for Information systems, among others. The RFP, along with such new approaches as competitive dialogue and negotiations, provides a lot more opportunity for dialogue with the market in defining a technical solution. The July 2016 versions of (a) Request for Bids (RFB) (b) Request for Proposals (RFP), and (c) Initial Selection Document for RFP are available at internal and external websites.
The introduction of the Project Procurement Strategy for Development (PPSD) is a critical tool in the NPF that will be used to select the optimum procurement method cognizant of risks, market dynamics and operational needs. This will ensure that the right approach to market is selected and that good market analysis is conducted which will feed into the project preparation and implementation of procurement activities that best suit the ICT sector. Detailed guidance note for PPSD is already available at the Bank's intranet and external website (URL: http://www.worldbank.org/en/projects-operations/products-and-services/b…). Furthermore, the Bank is designing suitable training courses, e-learning modules and guidance notes particularly on application of the new procurement methodologies, in order to further support implementation of investment projects.
Finally, the Procurement at the World Bank has a dual role fiduciary assurance and borrower capacity building (see Section III.A of the Procurement Policy) and will thus play a more predominant role in borrowers' procurement reforms and capaci
IEG notes that a new procurement framework will be implemented in January 2016. The new framework featured with new procurement methodologies and more details and trainings to assist the implementation of the new procurement framework.
Management has submitted to the WB Board a proposed new Procurement Framework which will be discussed on July 21 with an implementation date of Jan 1 2016. Management has reflected the feedback from IEG and has ensured that the new procurement framework follows a fit for purpose approach which offers more choice and new Procurement methodologies (including those that better support IT procurement) fully reflected in the framework. For example, PPP, competitive dialogue, use of negotiations, best and final offers etc. Management has drafted appendices to the Framework (currently awaiting Board approval) that provide detail on the new procurement methods to further assist staff and borrowers in implementation. Further, the Bank is in the process of designing suitable training courses, e-learning modules and guidance notes to further support implementation. Management has proposed in the new procurement framework a sectorial engagement program that will used to strategically engagement with key sectors including IT, and the GGP are developing global talent pools of specialized staff to support complex procurements including ICT. The introduction of the Project Procurement Strategy for Development (PPSD) is a critical tool in the new framework that will be used to select the optimum procurement method cognizant of risks, market dynamics and operational needs. This will ensure that the right approach to market is selected and that good market analysis is conducted which will feed into the project preparation and implementation of procurement activities that best suit the IT sector.
Additional Information From Management:
Actions K and L are to be done by the Procurement team under the Governance Global Practice.
IEG notes that there is some progress in the development of new materials as part of the procurement reform, and that the Governance GP is defining its business objectives, delivery model, skills and job streams needs including on ICT procurement. However, this exercise is expected to be completed only by March 2015 and there is no progress update on other activities agreed with WBG management, including âadapting procurement rules to reflect sector specificity and the growing use of public-private partnershipâtype approachesâ and âensuring the design of consistent procurement procedures to facilitate effective collaboration between technical staff and procurement specialists, including by upstream engagement of procurement specialists during project preparationâ. As a result, it is impossible to assess the implementation progress of this recommendation which was to improve the World Bankâs procurement outcomes in ICT projects and ICT components.
As Management is developing new materials as part of the procurement reform, there have not been any updates made to the current documents and associated guidance. Under the current timetable, the new documents and guidance will be developed by FY16.
The Governance GP is currently defining its business objectives and delivery model. As part of its strategic staffing exercise, it will soon assess the skills and job streams needed including on ICT procurement to fulfill its obligations. The time frame for this exercise will follow the key milestones of the on-going Bank-wide strategic staff planning process as it will provide key guiding principles on staffing matters necessary for the Governance GP to define career paths, job profiles, competencies, and staff deployment. It is expected that this exercise will be completed by March 2015. The implementation program for undertaking the required capacity building initiatives will be formulated immediately after the adoption of the staffing strategy.
(2013 Rating: Negligible)
(Response from 2013. First MAR follow-up will be in 2014)
IEG notes that there is some progress in developing more flexible approaches for private sector projects, including ICT and the related approach paper for its OVP review, and the discussions with other MDBs. However, these initiatives are yet to be adopted and no progress has been reported on the improvement of procurement outcomes in ICT projects and ICT components, including for strengthening ICT expertise among procurement specialists.
(2013 Rating: Medium)
(Response from 2013. First MAR follow-up will be in 2014)
The Bank is considering more flexible approaches for private sector projects, including ICT. OVP review of the draft approach paper has been completed. The guidance notes are being updated in parallel.
SBDs for larger ICT systems have been discussed with the MDB working group on procurement harmonization, and their recommendations are being incorporated.