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Procurement Perspectives: Municipalities hesitant to adopt new technology

0 76 Technology

by Stephen Bauld

I have talked about this topic over the years. It has proven to be very difficult for companies to introduce new technology into municipalities, some would say impossible.
Procurement Perspectives: Municipalities hesitant to adopt new technology

For some reason most municipal procurement and public works managers want to stay with whatever product they have been using and are for the most part unwilling, or reluctant to make any changes for any reason.

By definition, state-of-the-art technology is emerging technology at the leading edge (sometimes more appropriately called the 'bleeding edge') of what is technically possible at any given point in time. The purchase of such technology departs from the conventional wisdom that a customer should avoid purchasing something that he or she does not understand.

There is much common sense in the observation that it is necessary to understand what one is getting into. Setting specifications such as required products to be "innovative," "outside the box," "state of the art," or similarly unique is essentially asking contractors to carry out their own research and development at the municipality's expense.

Most contractors are happy to absolve themselves of this normal business cost. In my opinion, governments generally — and municipalities in particular, if only due to their more limited resources — should confine their purchases to services that are consistent with "prevailing industry practice or custom" and their purchases of goods to "proven technology" that is accepted as the "industry standard" or at the very least a clearly recognized alternative technology.

Hi-tech programs are most dangerous from a governmental service perspective when dealing with time critical projects. All too often in such cases, governments begin spending money in a near desperate attempt to complete the development of the required technology in sufficient time to allow the project to go ahead.

One of the problems we face is that implementing a technology before it is mature presents a number of serious problems, some of which unfortunately never become obvious until after the order is placed.

The more advanced the technology that one is trying to develop, the greater the cost that is usually associated with it. There is a need to keep technology-based wishful thinking grounded in reality.

Aside from issues related to performance concerns, generally speaking, new technologies are often more costly. Pioneers pay a larger share of the development cost of a new product then do those who wait until product has finished its breaking-in period.

Worse yet, warranty and maintenance support is likely to be harder to find and more costly to procure. It is easier to conceive of high-tech solutions then to develop them. Often technology remains out of reach for decades. In the 1950s scientists thought that financially viable fusion-powered electrical power would be achieved within 10 years. It is still decades away and may never be accomplished.

Further complicating the picture is the fact that it is difficult to predict where a market will head. The purchase of a state-of-the-art system may lead to a dead end.

It cannot be assumed that a new technology will prevail because it is technically superior to its competitors. Even though it is so difficult to get new products accepted for use in municipalities, every one of them should have some process to be tested and evaluated.

As a municipal purchasing manager myself many years ago, hi-tech solutions do make sense in certain circumstances — all of which are implicit in the basic premise that procurement activity should focus on addressing a genuine, clearly identified and properly understood need.

A recent article I read was warning us that high-tech is turning us all into time-wasters. The main focus was that mobile phones and emails distract employees from work and that 20 per cent of workers are chronic procrastinators.

Stephen Bauld is a government procurement expert and can be reached at swbauld@purchasingci.com.

Some of his columns may contain excerpts from The Municipal Procurement Handbook published by Butterworths.

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