How innovation is positively impacting state government procurement

Many in state government are concerned about saving money on behalf of taxpayers and serving their internal customers. Across the public sector, the value of state procurement is massive - spending $2 trillion each year on a spend portfolio from office supplies to whole-of-government enterprise resource planning.¹ At a recent National Association of State Chief Administrators [NASCA] conference, I shared how Amazon Business is helping our customers to modernize procurement practices.

Customers of a state procurement office include agency procurement employees, end users of contracts, park rangers, police car mechanics, suppliers, taxpayers, and governors to name a few. When we asked them what they expect from state procurement, they told us guidance on spend policies, speed, transparency and best value are most important – and that’s a lot to solve for. Central to these expectations is modernizing procurement practices to get internal customers what they need to get their job done.

There’s a lot of great work already happening within state governments to evolve procurement practices. Many states have centralized their procurement departments, adopted e-procurement systems, and a few have adopted lean principles to become more efficient and eliminate waste. Many still have outdated legacy systems that are unpopular, are using paper-based processes, and are struggling with how to compliantly modernize while still meeting their procurement statutes.

With consumers accustomed to getting virtually anything they need delivered to their door in a few days, 50% of the workforce being millennials next year², and state jobs seeing a 19% decrease in applicants since 2013³, it’s more important than ever to consider compliant, procurement modernization to meet the expectations of customers and employees alike.

Imagine if a millennial staffer could purchase in the same familiar way they do at home, easily order from local and minority-owned businesses, speed up the delivery process, and delight their customers? What if this same staffer could ask Alexa to re-order paper as she is dashing into a meeting or generate a report on MBE spending for the last month, quarter, and year in a few minutes? What if the state police auto mechanic could order more oil filters with a simple voice command - all within set procurement policies? All of these things are possible and happening today across state government customers with the help of Amazon Business. Procurement is becoming less about the simple purchasing of goods, and more about helping elevate the way state customers experience their workplace, spend less time on repetitive tasks, and more time focusing on strategic projects.

The world of procurement is changing rapidly. According to Gartner, by 2022, 75% of all B2B tail spend goods will be purchased in an online space such as Amazon Business⁴, and organizations will increasingly automate routine purchasing so they can spend more time on strategic tasks. That’s only 3 years away. A transformation can help states promote balance, address existing challenges, and rethink procurement function as a vital part of a state's economic growth and development. Here at Amazon Business, we're ready to help you achieve your procurement goals and serve your customers with balanced solutions.

¹ McKinsey & Company, May 2019
² MRI Network Millennial Hiring Survey
³ March 2019 NEOGOV report
⁴ Gartner, Inc. November 2017