Quality of management information
These findings report on known procurement data quality issues, limitations of the indicator set in providing insight into procurement service performance, and opportunities for improvement. The Context chapter includes common quality of management information findings across all functions that are not repeated in this chapter.
There are concerns with the quality of management information for the Procurement function. The highly devolved nature of the Procurement function makes it hard to measure consistently because measurement only captures costs where procurement activities make up more than 20 percent of a person's time. Therefore, it is expected that the cost of the Procurement function in New Zealand agencies is understated and less reliable for comparison between agencies and over different reporting periods.
Procurement cost and efficiency information will improve over time. Successive benchmarking activities will improve the accuracy of cost data over time. However, global procurement cost data quality issues mean that this function will more than likely provide less accurate cost and efficiency information than the other functions for several future benchmarking exercises. Improvements in accuracy will lead to some increases and reductions in reported numbers, through either greater inclusion or exclusion of A&S service information.
There is an opportunity to strengthen the measurement of Procurement. Opportunities to improve the procurement measures for FY 2011/12 will be investigated with the Government Procurement Reform Programme and procurement practitioners.
While results are broadly comparable, they need to be understood within the context of each organisation. Care should be taken when comparing agency results and caution is warranted for three reasons:
- Cost information is likely to be inaccurate for measurement reasons outlined earlier in this chapter.
- Agencies that submit more complete procurement cost information may appear to be less efficient than agencies with less complete procurement cost information.
- The Procurement function varies according to the primary role of the agency and the nature of its third party spend. For example, the nature of the Procurement function in agencies with large capital procurement programmes is considerably different to the Procurement function in a policy agency.
