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ARCHIVED - Management of Large Public IT Projects - Canada


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1.3 Procurement philosophy

The government has adopted an innovative new approach to buying goods and services to help ensure the success of complex IT acquisition projects, traditionally characterized by significant risk. The approach is called Benefits Driven Procurement (BDP), stressing a focus on results, on the benefits that the government – but also its suppliers – must gain from each acquisition project. BDP is a philosophy more than a method, although its aims are achieved through very methodical means. Although developed to solve problems with information technology acquisitions, the BDP has a broad application and is relevant to a wide range of high-risk procurement endeavours.

The BDP approach is designed to avoid the pitfalls that beset many complex projects – the delays, cost overruns and end results that often fall far short of expectations. It is a new concept for today's new era of rapid-fire technological change, competitive marketplaces and pressures on governments to be more efficient and effective than ever before.

BDP addresses many of the problems related to traditional procurement approach by focusing on the overall desired outcomes rather than on detailed requirements. Basically, the BDP approach is to ask suppliers to deliver certain agreed upon results rather than follow a blueprint.

The other key distinguishing feature of BDP is thorough and rigorous front-end planning to remove or mitigate potential problems in the procurement process. Both the front-end planning and the management of the entire acquisition life cycle are based on four elements: i) a solid business case; ii) risk analysis; iii) clear delineation of accountabilities; and iv) a compensation structure closely tied to the supplier's performance.