Impact

In only four years, Intercent-ER Agency has reached highly relevant results, becoming one of the most consolidated experiences of e-procurement at national and European level. Between 2005 and 2008 the Agency activated Framework Contracts – FC (a purchasing tool to bind companies to supply PAs with goods and services under established economical and technical conditions) exceeding 1 billion Euro with Public Administrations of Emilia-Romagna Region. Via Intercent-ER, these PAs signed contracts for the acquisition of goods and services for an amount closer to 700 million Euro. PAs using Intercent-ER’s platform experienced relevant savings, not only from the perspective of lower prices for supplies (with an average 19% savings), but also regarding the procedures’ simplification and the reduction of administrative burden. Procedural savings amount to ca. 5 million Euro and 180 person-years.

In 2008 Intercent-ER has shown an additional development of its activities in the field of Administrations' participation in the system, the volumes of managed expenditures and the supply of e-procurement services. The use of FC by PA.'s grew relevantly, with a growth of the value of supply orders from 189 million Euro in 2007 to 419 million Euro in 2008. Healthcare spending represents Intercent-ER's main area of intervention: Health Enterprises are the main users of FC, having made procurement orders for more than 260 million Euro.

Last year, the 22 implemented FCs, together with the ones already operative, enabled to  deal with an expanded range of commodity categories (45) and cover 25% of yearly spending of territorial PAs. Only In 2008, thanks to Intercent-ER, savings reported by Emilia-Romagna Administrations amounted to 67.5 million Euro (+102.7% from 2007). These new available resources, have been used to develop and strengthen services for citizens and companies. For the year 2009, Intercent-ER has forecasted new increases: the value of contracts signed by Administrations has been estimated around 1 billion Euro, while savings will reach 100 million Euro.

At a qualitative level, Intercent-ER's initiatives have shown important results. Throughout the years, the Agency has introduced and consolidated a system-based strategic approach in procurement policies by regional PA.'s, promoting technological and cultural innovation in the sector of public bidding. On the one hand, the widespread participation of territorial actors, Intercent-ER's high technical-strategic skills and the consequent aggregation of demand have enabled a relevant cost reduction and standardisation of  goods and services demands. On the other hand, the provision of the most advanced e-procurement services has further expanded the use of ICT applications, de-materialisation, simplification and transparency of tenders. On line services provided by the platform www.intercent.it represent the state-of-the-art and are constantly expanding.

The electronic marketplace, i.e., is a full-fledged virtual shop where P.A.'s can choose suppliers – especially SME’s – and make purchases below the required EC threshold. Moreover, on line bidding, where the exchange of documents and procurement awarding take place entirely via the web, is a tool which has increasingly been adopted by the Agency, for its own tender procedures as well as for others actors. In May 2009, i.e, an on line call for tender has been launched for the procurement of drugs for Health Enterprises from Area Vasta Romagna: this tender comprised more than 900 batches, for a value of ca. 250 million Euro. Finally, Intercent-ER provides also electronic auctions, through which companies can raise the biddings (lowering the price) in real time.

In 2009, in order to increase its scope of action and benefits for Administrations and companies,  Intercent-ER will expand its provision of e-procurement services. Besides, in developing new procedures established by the recently-enacted code on national tenders (“Framework Agreement” and “Dynamic Procurement System”), a module will be implemented through which P.A.'s will be able to purchase on line public works under European threshold. This year, in cooperation with Emilia-Romagna Region, Intercent-ER has started two very important projects. The first refers to electronic invoicing to complete the simplification and streamlining process of purchasing cycle. The second refers to the introduction of a payment card to be used by P.A.'s when purchasing goods and services of a small amount. One of the main benefits of this tool is the relevant reduction in administrative burdens associated with transactions and, above all, the cutting down of the payment delay.

This is a huge benefit for companies: faster, simpler and more transparent tenders, sure payment delay and more competition about the quality of provided goods and services. Intercent-ER, therefore, is a great opportunity and a privileged access channel to the marketplace of public procurement both for large companies and SME's.

In all initiatives for the streamlining of public spending, Intercent-ER mixes together lower spending and higher qualitative standards. One of its main quality criteria is represented by the attention paid to the environment and therefore eco-sustainability of chosen supplies: in recent years, the Agency has developed many actions of Green Public Procurement, by introducing precise parameters of environmental compatibility in its calls for tender. These initiatives have produced results which in 2008 alone resulted in a drop in CO2 emissions exceeding 6,200 tons.

The Agency is a flexible structure counting on thirty staff-members, with a yearly managing costs equal to 1,5 million Euro. In a single year it can produce savings for the public system for more than 67 million Euro. Its activity is not only fully sustainable, but also quite profitable.

Track record of sharing

Assets and skills developed by the Agency throughout the years have made Intercent-ER a national reference point for similar initiatives established (or to be established) in other Italian Regions. Many administrations have shown a strong and concrete interest in the application of the Intercent-ER model, its technological solution and its organizational model – starting forms of cooperation.

At extra-regional level, in 2007 CNIPA (National IT Centre for Public Administrations) published a call for the funding of projects for the “reuse” of best solutions developed after the e-government Call for P.A.'s innovation. Campania and Lazio Regions have applied for the reuse of Intercent-ER technologies, processes and methodologies. The Agency has provided support to the mentioned regions in the definition of technological, methodological and organizational aspects of the presented projects, in the designing of development phases and in the projection of expected results. At the moment, procedures for the operational start-up of the above mentioned projects - already targeted for funding - are taking place.

In early 2009 a MoU has been signed between Emilia-Romagna and Marche Regions aiming at optimising the institutions' savings on procurement, paying special attention on: health-care expenditure, promotion of telematic purchasing, fostering of synergies between local administrations. Following this agreement, Marche Region  – and especially its  Health Enterprise – will have the opportunity to use the platform managed by Intercent-ER, thus benefiting from its technical-strategic know-how and using e-procurement services, such as on line calls and tenders and electronic markets. A MoU between Intercent-ER and Centro Servizi Condivisi, the central purchasing body of the Health Enterprises of Friuli Venezia Giulia Region, is now in preparation, for the development of joint purchase initiatives for Bodies and Institutions of both regions.

The role acquired by Intercent-ER as best practice in Italy is confirmed by its active participation in projects for  the setting up of a network system of e-procurement bodies. The initiative, coordinated by the State-Regions Conference, intends to create a harmonized system of e-procurement at national level, in order to share acquired competences, to activate strategic cooperation and enhance partnerships supporting new central purchasing bodies. In particular, Intercent-ER has been assigned the coordination of the most relevant working group (the one related to purchase tools), which should define and streamline the adoption of different procedures for central purchasing entities.

Intercent-ER's participation in the European projects PEPPOL (Pan-European Public Procurement On Line) funded by the European Competitiveness and Innovation framework Programme (CIP) is extremely important, as it aims at developing a solution to make the e-procurement system of EU countries inter-operable and making the implementation of cross-border tenders possible. Intercent-ER has participated in the Consortium starting from the definition of the project plan, and plays a predominant role with respect to  the Work Packages related to electronic catalogues and electronic invoicing. The activities, started in May 2008, will be completed in 2010.

Moreover, Intercent-ER is sharing with the partners of Lisbon Regions Network (www.lisbonregionsnetwork.eu ) the possibility to promote a common project on a procurement card cutting payment’s delay and reducing administrative burdens.

Among the tasks attributed to Intercent-ER by Emilia-Romagna Region, there is the one on dissemination of innovative procedures in other Administrations of the territory, and the platform provision for the autonomous carrying out of procedure for telematic purchase. Other initiatives (6 telematic calls for tender) have already been carried out with the participation of several municipalities and Provinces of the region.

Lessons learnt

The long lasting experience gained by Intercent-ER demonstrates the benefits on savings that can be obtained from governments by rationalising goods and services purchasing procedures using e-procurement systems.

The main lessons learned from Intercent-ER experience are the following:

1.  The introduction of IT technology must be linked to the organization and the re-engineering processes. The success and the positive results obtained by Intercent-ER are not the result of the implementation of any IT system, but they come out of the implementation of a new and more efficient organizational model and of a re-engineering of the procurement processes.

2. Stakeholders involvement. A project  that implies deep changes into consolidated processes and systems must necessarily include a strong involvement of the subjects (in this case, firstly regional public administrations and secondly enterprises) to whom the project refers. The involvement model and tools, however, must be designed and managed in order to balance the need of representing all the different positions and guaranteeing a quick and efficient decision making process.

3. The level of the centralization of the procurement procedures is a critical factor to guarantee the efficiency of the processes. The results achieved by Intercent-ER show that the regional level is the most appropriate to promote efficiency driven by the larger scale of actors available compared to lower levels of government and the opportunity to better respond to local needs, understanding both PA’s demands and local enterprises potentiality.

4.  Intercent-ER experience has also a high potentiality to be transfer to other organizations:

- Firstly, the project set-up and the implementation process can be reapplied; Intercent-ER has been the first example in Italy of a regional purchasing office, providing services to a wide range of public administrations. The validity of Intercent-ER implementation approach is demonstrated by the fact that the Italian Government has financed similar projects to help other Italian Regions to set up similar experiences, imposing the condition to use the same methodology and the same project steps applied by Intercent-ER.

- The tools and services of Intercent-ER can be used by other regions; as mentioned in the previous section, many collaborations with other Italian Regions that are using / will use the e-procurement platform of Intercent-ER and the services have been set up. The sharing of the platform and of some processes allows a more efficient management and a decrease in the operational costs.