Jul 10 2024

State Procurement Offices Should Carefully Avoid Tech Fads

Officials must weigh factors such as total cost of ownership and longevity when acquiring solutions.

Artificial intelligence is everywhere these days. News media and advertising may leave you feeling pressured to join the crowd and be an early adopter. However, successful IT procurement involves engaging with a comprehensive list of stakeholders, conducting thorough research and careful implementation planning.

Emerging technologies often present unforeseen challenges and novel issues that procurement offices must be aware of and prepared for. Failure to do due diligence can lead to embarrassing or costly results. While chatbots are a common use of AI, Air Canada recently discovered that risks still exist when its chatbot hallucinated an incorrect answer on fares while working with a customer, leading to a lawsuit. Government technology breakdowns can have much more consequential impacts.

Whether buying the latest and greatest or tried-and-true technology, these evergreen tips for IT procurement from the National Association of State Procurement Officials (NASPO) can keep your tech solution from missing the mark.

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Why Collaborating with Stakeholders Matters

To ensure the procurement of effective IT solutions, it is crucial to engage with stakeholders. Collaboration between cross-functional teams requires clearly articulated goals for projects. Generally, several key groups should be included in every IT procurement project.

  • End users provide valuable perspectives on how new solutions may fit into current processes and inform the development of performance specifications. This may include civilian users for public-facing programs (online portals and self-service functions, for example).
  • IT experts offer information on how new technologies will interact with current systems and hardware, identify compatibility issues, assist with specification development, and estimate the longevity or effectiveness of solutions.
  • Security and risk experts ensure that legal obligations, cybersecurity standards and data protection requirements are met and help to minimize potential risks, including clauses that do not favor the agency in software license agreements and contract terms and conditions.

As part of thorough market research efforts, consider engaging outside expertise from suppliers and industry groups. However, potential suppliers who assist with research should be excluded from submitting proposals for the opportunity to avoid conflicts of interest and the perception of bias.

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Why You Should Try IT Before You Buy IT

Pilots, trials and demonstrations are your friends. If you have the ability and authority to pursue a solution-based solicitation before investing in a full-scale technology project, consider a trial’s benefits. Pilots and demonstration projects provide a real-world practice environment to determine if a technology solution is effective and the best fit for users.

Using pilots and trials may allow organizations to avoid future risks and challenges by answering several key questions:

  • Is this solution compatible with current processes and other tools?
  • Does it fulfill needs as intended?
  • What training or resources will be needed for implementation?

The experience and feedback gathered will help identify features, conditions, challenges and risks that must be addressed and optimized for the final procurement and implementation. The lower upfront costs of a pilot can allow states to pursue more novel and innovative solutions with minimal risk to limited financial resources or of political blowback for a perceived waste of funds. This type of approach could be particularly effective when procuring emerging technology, such as solutions incorporating AI.

For those offices constrained by mandates for competition, the Procurement Division of the Michigan Department of Technology, Management and Budget’s Competitive Proof of Concept solicitation method provides an innovative approach to piloting technology within competitive requirements. Learn more about it from this webinar.

READ MORE: Governments make the most of their budgets during a crunch.

Consider the Full Scope of IT Solutions

While more commonly associated with commodities, total cost of ownership is a familiar concept to procurement professionals and is an essential factor in determining the business value of any IT solution. When conducting research into potential solutions, answer the following questions:

  • Where is this technology in the product lifecycle?
  • What is the likely lifespan of this technology?
  • What maintenance is required?
  • Are there costs or risks associated with retirement?
  • What are your state’s/office’s disposal requirements?

Seat management, Everything as a Service and other cloud-based solutions allow offices to outsource IT resource management, data storage and applications. If you are purchasing hardware, consider technology that is modular or adaptable, readily upgradable, and durable. Such versatility and longevity can create savings throughout the product’s usable life.

Likewise, effective supplier and contract management throughout the contract term is crucial for the ongoing effectiveness of an IT solution and the mitigation of risks. Contract managers should communicate regularly with IT and security experts to address potential concerns.

You can read more about IT procurement and practical tips on the NASPO Pulse Blog and in the NASPO content library. For more about the importance of cybersecurity in procurement, see “Integrating Cybersecurity into the Acquisition Process” from NASPO, the National Association of State Chief Information Officers and the Center for Internet Security. For a comprehensive look at the IT procurement process and NASPO’s recommendations, check out chapter 18 of the new  edition of the organization’s State and Local Government Procurement: A Practical Guide.

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