In 2020 The Centre for Tendering was commissioned by the Economic and Social Research Council (via Productivity Insights Network) to investigate how well the region of Greater Manchester was equipped at eco-system level to prepare small firms to learn how to compete for public contracts. You will find an executive summary and link to the full report below.
The Centre for Tendering would like to thanks its project advisory group: Jon Corner: Chief Digital Officer, City of Salford; Mark Claydon: CEO, Trustech; Anne Lythgoe: Principal - VCSE Accord Implementation, GMCA; Peter Gaunt: Relationship Manager, Growth Company; Mandy Parkinson: Head of Business and Public Engagement, Manchester Metropolitan University; Nigel Rose: CEO, Macc; Darren O’Brien: Ecosystem Manager, Eagle Labs, Barclays Ventures; Carol Halford: Good Employment Charter Lead, Growth Hub; Mark Leaver: Strategic Lead-Integrated Commissioning, Manchester City Council; Nick Allen: Industry Procurement Adviser, Health Innovation Manchester. Thanks also go to the employers who gave their time to be interviewed, and to the many helpful organisations across Greater Manchester who supported this research. Finally, we express our gratitude to the Productivity Insights Network for funding the project.
Tendering describes a set of processes where specifications for public work are encased in a regulatory set of documents, under which potential suppliers can respond through completion of specialised information requests. The UK Government’s SME Action Plan (BEIS, 2019) sets out a modern, ambitious strategy that includes an ambition to spend £1 in every £3 of public sector procurement on smaller businesses by 2022.
This ambition follows a long track record of Governments trying to radically increase spend with small firms and, indeed, reflects an international problem (OECD, 2018). The effective exclusion of most SMEs from public sector supply chains, or their positioning at lowest end of value chains, impedes productivity by
1. undermining SME growth and local economic development;
2. inhibiting innovation and competitiveness in public supply chains;
3. wasting scarce SME resource in unsuccessful tendering.
Achieving the Government’s laudable objectives will demand both reform of procurement practices to streamline the capabilities demanded by tendering and investment to build the capability to tender in small firms.
The Productivity Insights Network commissioned The Centre for Tendering to focus on the latter problem: how to build capability to tender in small firms. The Centre for Tendering’s Capability Model proposes that competitive tendering is a knowledge-intensive process of developing a complex set of routines that combine in various patterns to build operational capabilities, enabled and renewed by dynamic capabilities, that enable small firms to win a stream of public sector contracts. This project investigated how well business support in a case study area – Greater Manchester – builds tendering capability.
It reviews how well each capability is developed and how effective the learning process is for small firms at different stages of the tendering journey. In particular, how support builds strategic commitment, absorptive capacity, diagnosis of learning journeys, learning to be tender-ready and learning to develop and refresh tendering capability. Indeed, the study asks how well business support in Greater Manchester acts as an ecosystem with the value proposition of enabling tendering capability and, so, procurement of £1 in £3 to small firms.
Findings indicate that overall, and with pockets of exception, business support across Greater Manchester does not create the value proposition of enabling small firms to be capable at tendering. The advice on offer is sparse; it offers partial or no advice about different capabilities in The Centre for Tendering Capability Model and is often limited to stating procurement rules and compliance demands. Information is often abstract and technical and there is no chance to contact a human being with whom to make sense of a particular business or tender invitation beyond tender question clarification procedures. Support is also fragmented, making it unlikely that most small firms will find most resources.
Advice therefore fails to engage with evidence on how small firms learn and to provide a learning process. There is no support available to diagnose where a small firm is in the process of learning to tender or to direct them to customised learning resources to suit different stages of the learning pathway. In particular, support to raise absorptive capacity and strategic commitment to tendering, build basic tender readiness and to develop and refresh tendering capability are not evident. Training, coaching and peer learning are largely absent. We make recommendations for developing tendering capability in Greater Manchester and offer a dashboard of priorities to develop enterprise ecosystems with the value proposition of building small firm tendering capability nationally.