Suppliers often see the procurement object from a different angle than the purchasing unit. Not because they know the customer's needs better, but because they recognize early on how these needs meet the reality of the market. They know which requirements narrow the competition, where the architecture locks the procurement into a specific solution, which integrations and schedules are most likely to cause delays, and where the real costs of the contract period arise.
It is this tacit market information that is easily left untapped, which can later manifest itself as low bids, high prices, and constant requests for changes.
Market dialogue brings this information to the procurement unit in time, before risks materialize in tenders or during the contract period, and transforms market insights into a competitive advantage.
We will delve into these questions in our upcoming webinar, where we will review how market dialogue directly affects the total cost of procurement (TCO), the emergence of competition, and the manageability of the contract period, as well as why its role is further emphasized with the reform of the Procurement Act.
Market dialogue is a recommended part of procurement preparation and reform of the procurement law With the introduction of the new standard, its status will change significantly. It will increasingly become a necessary way to demonstrate that the preparation of the procurement has been careful, market-relevant and pro-competitive.
As the requirements for preparation and the importance of ex post evaluation become more important, market dialogue becomes more closely linked to the purchasing unit's ability to justify key solutions, such as the choice of procurement model, the level of requirements, division into lots, or why there was little competition. In practice, market dialogue is increasingly becoming part of the procurement “evidence”, a way of demonstrating that solutions are based on market knowledge.
At the same time, the process nature of market dialogue is emphasized. It must be a systematic, fair and documented entity, the results of which are visible in the procurement structure and the request for tender. In this way, market dialogue also serves as a key risk management tool during the preparation phase. As a means of improving competition, reducing the sensitivity to interruptions and complaints, and above all, reducing the overall cost of the procurement even before the start of the competitive bidding process.
Market dialogue directly affects those cost items that typically fall outside the bid price. The more complex the procurement, the more time the purchasing unit and its experts spend on questions, clarifications, and subsequent change requests. If the level of requirements or the procurement procedure excludes operators, few bids will be received and prices will rise. The complexity of the procurement, and especially the lack of clarity, is also reflected in suppliers' pricing as a risk premium. In addition, it is the choices made during the preparation phase that largely determine the costs of the contract period.
Carefully implemented market dialogue reduces TCO costs primarily by reducing the structural uncertainty associated with the procurement. When the scope of the procurement, level of requirements, division of responsibilities, implementation model and integration needs have been tested against the actual capabilities of the market, the request for quotation guides suppliers to price the actual delivery and not to prepare for ambiguities. This is reflected in more realistic bid prices, but especially in lower life cycle costs during the contract period.
Good market dialogue is a goal-oriented, fair process that is linked to procurement decisions. At its core is the ability to distinguish between what the purchasing entity is aiming for, such as service level, effectiveness, information security and cost control, and how the market can realistically achieve these goals.
Good dialogue helps to answer:
In addition, market dialogue also provides information about the future: it reveals the typical dynamics of change associated with the subject of the procurement. Based on this, the procurement unit can build change mechanisms, options and pricing principles at the tender and contract stages that make the contract sustainable.
Market dialogue does not eliminate the need for changes, but it reduces their surprise, and this is precisely what is key to both TCO management and contract change assessment in accordance with the Procurement Act.
In the webinar, we will delve into how market dialogue brings tacit market information to the procurement unit in a timely manner and helps build competitive, cost-controlled and change-resistant ICT procurement even before the tendering process.
*The webinar is aimed at Graniitti Service for potential and current customers, especially for purchasing organizations. PWe reserve the right to check the information of those who have pre-registered and limit the number of participants to those in the target group.
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