Dynamic purchasing system vs framework – what is the difference?

What is procurement in the public sector? 

Procurement in the public sector is when a public sector organizations buy goods, works, services and supplies for any government body, agency, or department.  

It is crucial in public sector procurement local governments get the best value for money. Buyers need to make sure they choose suppliers that offer the highest quality service at the most reasonable price.  

At Access Adam Care Commissioning we primarily support the public sector procurement of healthcare, social care, transport, housing and general procurement activities. 

Dynamic Purchasing Systems Vs Framework – defining the difference 

 

Procurement in the public sector is when a public sector organizations buy goods, works, services and supplies for any government body, agency, or department.  

It is crucial in public sector procurement local governments get the best value for money. Buyers need to make sure they choose suppliers that offer the highest quality service at the most reasonable price.  

At Access Adam Care Commissioning we primarily support the public sector procurement of healthcare, social care, transport, housing and general procurement activities. 

Dynamic Purchasing Systems Vs Framework – defining the difference 

Both dynamic purchasing systems and frameworks offer great benefits, but before deciding which process to use it is important to understand the key differences between them.  

What is a dynamic purchasing system? 

A dynamic purchasing system (DPS) is a model of procurement which operates on an open market meaning suppliers can join at any time, or if bids close they will re-open frequently so new suppliers can consistently be onboarded.  

Dynamic purchasing systems are very popular in the public sector because it streamlines the procurement process. This has been increasingly beneficial as commissioners can continually expand their networks of suppliers and welcome new businesses so they can keep up-to-date with constant legislation changes and ensure the providers they work with remain compliant.

This can often help to spread any risk from suppliers going bust, are no longer compliant or have lowered in quality, helping commissioning and finance teams to forecast for the future more accurately. The large source of providers, can also give procurement teams better visibility of the supply market in the area to make community improvements or ensure a service is always covered. This is particularly helpful for housing and transport commissioning where a larger number of suppliers is required. 

What is a procurement framework? 

In public sector procurement, procurement frameworks can also be known as a public sector framework.  

A procurement framework is an agreement amongst the buyer and supplier on various terms including: compliance, prices, and the period of time this framework will be running for. These frameworks usually have a set number providers, usually between 6 – 10, allowing commissioning teams to work more closely with each provider and have a deeper insight into their functions, services and availability.  

Procurement frameworks do not guarantee work for a supplier but they do establish a trading relationship between a buyer and multiple suppliers.   

By establishing a closer relationship, local authorities and healthcare organisations can build joint objectives for future improvement and receive direct feedback on the working relationship.  

DPS Vs Framework – Which model is best for your local authority? 

For local authorities to decide which procurement model is best it depends massively on your needs, goals, and targets.  

DPS: 

The timing of when you want a contract secured by could have a major impact on what model is used. DPS systems engage the market quicker than a framework due to its pre-approved supplier lists created from your pre-existing criteria. Because of this new suppliers can be added constantly as legislation changes or as your needs change. With the Access Adam Care Commissioning platform, the process is completely electronic, with any suppliers that cease regulatory standards automatically removed to ensure your local authority and NHS trust only works with compliant and safe providers.  

One dynamic purchasing example would be Wren Housing Solutions, one of our customers at Access Adam Care Commissioning, made up of 4 London Boroughs - Waltham Forrest, Redbridge, Enfield, and Newham. Through using a DPS model and working with our automated solutions we streamlined their housing procurement process saving staff time and resources, as well as providing a full visibility of the market in real-time. This ensures they have a wide range of properties readily available for the various needs of their residents.  

 

Access Adam Housing has ensured the safety of Wren Housing’s properties through automatically checking the safety certificates of all their bidders and removing any uncompliant ones. We have automatically checked over 8000 safety certificates from over 200 different listings to help place over 1,500 families into safer and more compliant temporary accommodations. 

Framework: 

Sometimes depending on the service, closer relationships between suppliers and buyers are better than having a long extensive list of providers you may never have worked with before or may not be appropriate for particular offerings.  

Through selecting how many providers you want to work with before you start your procurement process you can focus more on the quality of your service delivery rather than the quantity of bidders. This also limits the competition for bidders and increases the likelihood of renewed contracts with providers to build even closer relationships.  

This is exactly what Waltham Forest wanted to do. Waltham Forest started working with Adam in 2015 using both our housing and transport solutions. After their home support service contract with another provider expired, they decided that instead of using a DPS they would prefer to work with 10 different providers on a framework. Their aim was to focus on quality over quantity and build stronger partnerships with the providers they work with.  

Once the providers were selected each of the 10 providers were set into zones and they have the opportunity to get 1st choice at any new offerings. If the providers dop not accommodate to the new offering or do not respond in time it will then be offered to another provider on the framework.  

To ensure each provider remains complaint each provider has a set of KPIs (key performance indicators) they must follow, they also have to fill out quality questionnaires, and have an in-person inspections. All these details are then uploaded onto our system and our reporting tools allocates each provider with a RAG rating to provide Waltham Forest full visibility of trends and performances.  

Through working together with their providers and using our solutions, Waltham Forest have been able to achieve their goals and gain stronger relationships with providers meaning the quality of the care they deliver in their local area can improve.  

What is the future procurement model for your local authority? 

Regardless of whatever procurement model you choose there will be advantages and disadvantages of each, it just depends on what your aims are.  

Both models work well and are successful as long as you take the time to evaluate your services to highlight the areas you need to improve and what specifically you need from a provider.  

DPS systems are great if a service is delivered to a huge population across a local authority as it provides an open market to build up networks of suppliers and providers to call upon as needs change. It is quick to engage the market when a new provider is needed and by having a range of suppliers onboarded at any given time you can cater to all the needs of your local community.   

However, having such long list can lead to your local authority having a supplier list which is not effective and does not meet your requirements. This can result in a potential loss of close partnerships you may have previously established and create more challenges than it solves.  

Frameworks are most effective when you have a specific group of residents your service is catering for. Knowing what they will need specifically will help you decide how many providers you need onboarded onto the framework. This helps builds stronger relationships to create long term value for buyers and suppliers to collaboratively improve the quality of care delivered and mitigate risks together. It also reduces the competition between providers meaning the likelihood of getting work is higher which can be a lifeline for some small businesses.  

However these frameworks are long term agreements, usually lasting four years, meaning managing  suppliers in that time can be difficult, especially if a business experiences financial hardship or if the relationship breaks down. The restricted deadline also means when this does happen no new suppliers can be selected. This also reduces the opportunity to onboard more innovative services or use more renewed technology as they come around.  

So if you want more flexibility in your contracts a DPS system will most likely be a better option for you. You will be able to choose from a wider range of suppliers and can have shorter term contracts to update your services as much or as little as you need to, without any time constraints or limitations to the quality of care your services deliver.  

However, you also have the option to do a combined approach with a framework being your main supplier source and contracts dropping into a DPS model when they cannot be fulfilled by the framework suppliers.  

Worried about going to tender? Access Adam Care Commissioning are also partnered with YPO under the Commissioning Solutions – 1017 Framework. By partnering with Access and YPO, Local authorities and NHS organisations can benefit from substantial time savings; the Access Adam Care Commissioning solution is already an approved framework agreement. This also means customers don’t need to undertake additional competition/procurement exercises as they are working on a single supplier framework. 

DPS Vs Framework – Summarising the difference 

In this article what procurement means in the public sector and the key differences between a DPS and a framework has been explained, as well as which model would be better depending on your local authority’s needs.  

Here is a key summary of the main differences: 

 

Dynamic Purchasing System (DPS):

Framework:

A digital procurement process which is usually open all year-round or re-opened frequently for providers to constantly apply and be onboarded   Markets are quicker at engaging on a DPS because of the pre-approved supplier lists   Multiple providers can be onboarded at any given time   Longer supplier lists can mean providers may not be able to deliver the specific requirements you need leading to an exhaustive ineffective list of suppliers – this could result in losing already established partnerships with providers  There is often mor competition between bidders

Longer-term contracts averaging from 1 to 4 years   They tend to create closer and stronger relationships with providers   You decide how many providers you want to onboard at the start of the procuring process   Deciding how many providers to onboard can help improve services that deliver care to particular target audiences   Longer term contracts can be harder to manage and when relationships break down you cannot change to another provider until the contract expires   Longer term contracts puts you at risk of being less exposed to new innovative ways of delivering care and renewed technology

 

When choosing which framework your local authority should use our procurement guidance would be to plan, assess, and evaluate your needs thoroughly first before making any decisions. Do you need flexibility with your contracts?  Or do you want closer relationships with your providers to cater services to specific residents? These are all key questions you should be answering in the initial planning stages to help improve your outcomes further.  

How can Access Adam Care Commissioning help improve your procurement process? 

At Access Adam Care Commissioning our solutions work perfectly regardless of the procurement model you go with. Whether it is dynamic purchasing system software you need or framework software. Our reporting tools allow you to have full visibility of the service market your local authority delivers, and our automatic safety and compliance checks ensures you only ever work with complaint providers to mitigate any risk or harm to the residents in your local area.  

We work hard to adapt our solutions to best fit your needs, whether it’s to build stronger relationships or be more complaint to reach the increasing demand for services when the budget keeps decreasing. We streamline your existing processes through the system to make efficient savings, allowing for speedier placements and contracting. We value the importance of working collaboratively with your providers to help improve the local delivery across integrated care systems and community care provisions, and we want to ensure we can help make this happen.  

Discover our Access Adam Care Commissioning software today and learn how the safety and compliance of your services can be enhanced to improve the overall care delivery to the residents in your local authority.  

Speak to us today and we can show you how we support and improve procurement processes for a variety of services from transport, housing, and healthcare to get better outcomes and save costs in the long run for your local authority.