25/09/2018, 15:54



Demystification-of-Data-Management-in-Public-Procurement


 The following text is (almost) the transcript of the keynote speech I delivered at the 2018 Global Public Procurement Conference organised by the Interamerican Development Bank, Washington 17-19 September 2018



I grew up in small town in Southern Italy. In that environment the social structure can be hard to follow, even for locals. It made me curious to learn how the world works. Specifically, how we’ve made it work for ourselves-how is it that we’ve built infrastructure like roads and electrical grids? And shared community resources like hospitals and schools? The short answer is: public procurement. 

The way governments buy services and spend money for their citizens affects every one of us. Public procurement has been a part of government for hundreds of years! Engineering achievements such as the Roman Aqueduct of Segovia built almost 2,000 years ago give us a sense of what we mean by a civil work that has been properly done.

It’s easy to criticise public works. The viaduct "Morandi," named after of the Italian engineer who designed it was a major commuting link in the north-west of Italy. It collapsed at around noon on the 14th August killing 43 people. The bridge was only 51 years old.Investigators have already pointed out that alerts on structural damages had been repeatedly ignored. 

How did this happen? Simply put, poor communication between the government and the concessionaire’s safety team. Information about crucial structural aspects has been badly processed and possibly ignored. Information and its management are the keys to smart, functioning public procurement-just like those Roman aqueducts.

This is where my work comes in: In high school, I realized that math and statistics are excellent tools for modeling the uncertainty of our societies. Models trying to capture different aspects of uncertainty are complex objects, and may fail. It can be daunting. But it can also be thrilling-becauseit’s our lives! Life is the ultimate laboratory. Although we may fail to understand exactly what kind of information and management systems we need, our failures provide us opportunities to learn. Bad prediction isn’t bad news-it’s a way of making your thinking finer and more precise. 

"We are trying to prove ourselves wrong as quickly as possible, because only in that way can we find progress.
Richard P. Feynmnan (Physics Nobel Prize Winner)

And that’s why diving into the world of public procurement was the best way to carry out my childhood dream: It showed me how our societies work, and what they need to thrive.            

Close your eyes and picture a bridge, a road, a building. It’s easy to see these structures on their own. Now think about how they are all connected: In this case, the road paves the way to the bridge upon which the employee drives from her home to her office building. Both the road and bridge matter as parts of the transportation as well as the energy distribution system. They also play a role in her and the community’s safety. The road and the bridge provide services whose features change according to users’ behavior. This is a smart city.

Some of us are already living in smart cities where buildings, roads, transportation system are conceived to provide a variety of connected services.  These cities work so well because they have a wealth of information.

There are a lot of different types of information. It’s how many vehicles the road needs to serve, at what time of day, and how many people drive in those vehicles. It needs to be continuously collected and processed in order services to best respond to users’ behavior. Cities have to become smarter both in developed and developing countries. The next challenge in public procurement is managing and upgrading these smart cities. "Road maintenance" includes roads, street lighting, and electricity distribution. Information will drive the nature of procurement in an interconnected world.

Collecting this information is a challenge for two reasons. First, we need to know what data we need, and second, how to get it. Again, it’s a daunting task-frightening even! 

In 2014 the World Bank hired me to complete two missions for the Republic of Ethiopia. I was sent to the country to assess the federal centralized procurement system. A crucial meeting had been scheduled with three top officials. These men were supposed to help me find the savings the government had put away by bundling common-user items purchases in bigger contracts. I explained to them the pieces of information I needed to draw some conclusions. They listened to me attentively, then the most senior one looked at me as if I were an alien. He asked: "Why spending all this time hunting for figures? We can tell you what happened." He was afraid to give me the data because he was worried that I would draw different conclusions than they had. But that was exactly what I was sent to do! The ultimate purpose of my mission was to help them see things from a different perspective. 

Relying on too little data is one problem in public procurement. The other happens when we rely on them blindly. It’s not enough to have information alone; we need to use our common sense to trust and interpret it. 

Tyler Vigen, a law student at Harvard, set up a fascinating website with an accompanying book on many circumstances where one can find extremely strong statistical correlations among phenomena, which are extremely unlikely to be logically related. For example:


Intriguing, isn’t it? Who among us would have bet on such a positive correlation between "Per capita consumption of mozzarella cheese" and "Civil engineering doctorates awarded"? And yet, we all know that there is no actual relationship between these two variables. 

The "statistics of wishful thinking" is the danger of jiggling with data so as to impress others (... hum ... say, policy makers). Unfortunately, this happens more often than you think. During the past few years, I’ve attended over a dozen international meetings on the benefits of using e-auctions in public procurement, the so-called reverse auctions. Believe it or not, I have never heard any speaker presenting figures on the savings from reverse auctions below 50%! I’ve come to the conclusion that, perhaps, in public procurement any figure below 50% is just a curse... (or maybe forbidden!)

In another occasion, I was involved in a high-level meeting on the benefits of centralised procurement in the European Union. In other words, governments buying in bulk. Representatives from centralised agencies were presenting different models in drastically different countries, with obviously different social needs. But guess what? There was a weird coincidence in terms of basic performance: Each agency was able to achieve savings exactly between 19% and 21%! (fortunately, in centralised procurement the below-50%-threshold curse does not apply) Virtually, the same performance across different countries and systems. It was like magic!

The statistics of wishful thinking works to me as a sort of antidote against the "statistics of deception." True, sometimes figures show something we may not like. They may not disappoint as much as the kind of evidence mentioned by the character Albert Burnside in the 2008 movie "Nothing But the Truth":

"A man can live a good life, be honorable, give to charity, but in the end, the number of people who come to his funeral is generally dependent on the weather."

Data don’t lie. They are the key to using public procurement to advance our lives.     Evidence-based decision-making in public procurement is becoming increasingly urgent. 

We have examples of how good governance has led to thriving communities through public procurement. Take the project "Iscol@" promoted and funded by the Region Sardinia in Italy, which ultimately aims at drastically reducing school drop-out rates and to improve the quality of human capital. One of the pillars of the project consists in refurbishing school buildings and constructing brand new ones so as make them "modular spaces". Internal physical features such as the size of the rooms can be modified according to the subject taught. This is really smart, isn’t it?   

In a not-so-distant past we seemed to be comfortable in undertaking public procurement reforms without looking at evidence before making crucial decisions. We have seen how this can go awry, as with tragedy of the Morandi viaduct. My understanding is that policy makers were satisfied with idea that systems could be reformed by the force of principles and analogies-without actually learning from experience.  Transparency, for instance, is "holy grail" in public procurement. Analogy has been used when mimicking allegedly self-evident successes in the private sector such as the e-commerce platforms and, guess what, reverse auctions.

Times have changed already. The buzzing of procurement activities worldwide goes hand in hand with information production, which gets disseminated in multiple forms. We need information to learn from the past, to correct our mistake, and to move forward. Information is sometimes scattered-owned or managed by different organizations. Worse, information about the same phenomenon is written in different ways, which can be confusing. Our learning ambition is all too often frustrated by the babel of codes to describe the same thing.

Here is the good news: It’s becoming easier and easier to gather and correctly interpret information for public procurement. The Data & Analytics Framework experiment in Italy is one such example. At its core, it is a partnership between a big data platform and two teams. The data platform acquires, processes and provides information for analysis and machine-to-machine interchange. The teams are comprised of data scientists and visualization experts. Together, they use visual storytelling to effectively convey the information contained in the data. It will become possible to connect data from different sources that relate to different aspects of social life that are not independent from each other. 

Close your eyes again and visualize a street in a city... water pipes, fiber optic cables and metro tunnels under the surface...tramway tracks, lighting infrastructure above...a massive amount of data and information is produced about different aspects of our lives: transportation, safety, and health. The same street can be looked from different perspectives, which requires integrating different sources of information. 

Only a few years ago this would have been unimaginable. The potential of the Data & Analytics Framework as well as of other projects in same spirit is not limited to better exploit information on the procurement cycle of a vital infrastructure. It is a new way of using information for new forms of government, new forms of participation in the management of the res publica. It is the door leading to a new form of citizenship-all possible by tackling the difficult questions of information gathering and management head on.

And if you wonder whether this new scenario will be populated by as many lawyers as in today’s procurement, well the answer is... YES!

New professionals will join the team...with original thought, clothes, and maybe even tattoos.

Thank you!
02/06/2018, 16:16



Gli-appalti-pubblici-tra-la-Scilla-della-flessibilità-e-la-Cariddi-dell’ipertrofia-regolamentare


 



Chiunque abbia maturato un minimo di esperienza negli appalti pubblici in Italia è ben consapevole di quanto le "regole del gioco" siano frutto di un ampio e, a dir poco, faticoso compromesso a livello continentale. Non siamo né soli né indipendenti nello scegliere come la Pubblica Amministrazione si approvvigiona di beni, servizi e lavori. L’architettura normativa si plasma a Bruxelles. E quindi, per capire l’attuale assetto normativo nazionale, bisogna leggere la genesi delle Direttive EU 23, 24 e 25 del 2014 e le principali linee strategiche promosse dalla Commissione Europea.  

Tra le parole chiave che caratterizzano il nuovo (almeno due anni or sono) pacchetto legislativo spiccano sicuramente "semplificazione" e "flessibilità". Parole queste che sicuramente fanno parte del gergo e della pratica quotidiani nel Regno Unito, ma che in alcuni paesi mediterranei suonano al più come il canto di una sirena.
Vediamolo in concreto un esempio di "flessibilità", frutto della trasposizione delle Direttive EU nel codice dei contratti pubblici (d. lgs. 18 aprile 2016, n. 50) e, soprattutto, l’ulteriore "tocco" di flessibilità apportato dal (primo?) correttivo solo un anno più tardi (d. lgs. 19 aprile 2017, n. 56). La Direttiva 2014/24/EU recita all’articolo 67: 

"Fatte salve le disposizioni legislative, regolamentari o amministrative nazionali relative al prezzo di determinate forniture o alla remunerazione di taluni servizi, le amministrazioni aggiudicatrici procedono all’aggiudicazione degli appalti sulla base dell’offerta economicamente più vantaggiosa". 

Il testo sancisce quello che molti esperti hanno considerato - e non a torto - un passaggio epocale: la valutazione di aspetti economici qualitativi rappresenta il criterio di aggiudicazione di riferimento, quello da utilizzarsi in "normali" circostanze. Il prezzo più basso non è affatto escluso, ma viene relegato a un caso estremo, come dire, un’eccezione alla regola. Valutare aspetti qualitativi ed economici sembrerebbe profilare quindi un’ampia libertà di scelta per le stazioni appaltanti, o almeno questa era l’intenzione del legislatore continentale. Tuttavia, quello nazionale, spinto, forse, da un desideratum di andare ben oltre quello continentale, rilancia: 

"La stazione appaltante, al fine di assicurare l’effettiva individuazione del miglior rapporto qualità/prezzo, valorizza gli elementi qualitativi dell’offerta e individua criteri tali da garantire un confronto concorrenziale effettivo sui profili tecnici. A tal fine la stazione appaltante stabilisce un tetto massimo per il punteggio economico entro il limite del 30 percento."(art. 95, comma 10-bis, d. lgs. 56/2017). 

Il crescendo di incoerenza logica in solo quattro righe è quasi eclatante. Si parte dall’ipotesi che la stazione appaltante persegua l’obiettivo di individuare il miglior rapporto qualità-prezzo. Quale migliore dichiarazione per convincere il buyer pubblico che, sì, la flessibilità è tutta da sfruttare. Ma l’illusione dura poco (sigh!). Il buyer pubblico - lo stesso che si era illuso di poter finalmente godere della tanto sbandierata flessibilità - al fine di "garantire un confronto concorrenziale effettivo sui profili tecnici" deve assegnare alla componente tecnica almeno di 70 punti su 100! E  la flessibilità evapora senza lasciare segni...


Ma, insomma, non attardiamoci sull’incoerenza logica del testo e soffermiamoci sulle potenziali conseguenze - tutte negative - che possono scaturire da tale vincolo, adottando un approccio dialettico (con il mio alter ego... che, in verità, la pensa non diversamente da me). 

Imporre un limite minimo alla componente economica serve alla stazione appaltante per conseguire beni, servizi e lavori di migliore qualità? Niente di più palesemente falso, almeno per chi è impegnato nella trincea degli appalti pubblici, e questo per svariati motivi. La qualità entra concretamente nel benessere della stazione appaltante quando viene effettivamente erogata. Dipende tanto dai criteri tecnici premianti quanto dai requisiti minimi. E dipende, soprattutto, dalla possibilità che venga monitorata e misurata in fase di esecuzione. Quindi il momento cruciale non è quello delle "promesse" (= fase dell’aggiudicazione), ma quello in cui le promesse vengono mantenute o rinnegate (= fase dell’esecuzione). 


Costringere le stazioni appaltanti a cercare ulteriori criteri premianti rispetto a quelli che avrebbero selezionato in assenza del vincolo, potrebbe costringerle ad aggiungere aspetti tecnici difficili - nel senso di troppo costosi - da monitorare (ad es., la rumorosità delle apparecchiature elettroniche) spingendo quindi le imprese a "competere in promesse" che difficilmente saranno verificate in fase di esecuzione. Peggio. La stazione appaltante potrebbe essere tentata da malefici criteri "progettuali" o relativi a "modalità di erogazione" anche quando la stazione appaltante è interessata all’esito della performance, e non a come la performance viene ottenuta (non preoccupatevi, prima o poi tutti cedono a questa tentazione...). Inserire criteri di questo tipo potrebbe trasformare la competizione in una "beauty contest" con maggiori rischi di discrezionalità nella valutazione tecnica. Inoltre - e non secondariamente - se la componente progettuale ha un peso non trascurabile le imprese potrebbero percepire un maggiore grado d’incertezza e quindi, paradossalmente, competere in misura maggiore sulla componente economica.


Una stazione appaltante che proprio non riuscisse a determinare almeno 70 punti per i profili tecnici (ma è possibile?) potrebbe essere tentata di ridurre i requisiti minimi degli aspetti qualitativi in modo da aumentare il peso di quelli premianti (attraverso un aumento dell’intervallo dei valori premiati). Paradossalmente, questa strategia potrebbe favorire la partecipazione di imprese con qualità mediamente inferiore rispetto allo scenario senza vincolo. E l’esito sarebbe tutt’altro che scontato.


Quando il buyer ha veramente piena flessibilità di scelta del rapporto qualità-prezzo, aumentare il peso e, plausibilmente, il numero dei criteri qualitativi non ha soltanto lo scopo di ottenere una "qualità" più elevata. Serve anche per permettere alla stazione appaltante di una più ampia varietà di soluzioni. La lezione più concreta che ci viene dall’altra sponda dell’Atlantico è che le stazioni appaltanti hanno un grado di conoscenza delle soluzioni di approvvigionamento  e strutturalmente inferiore al mercato della fornitura. Quindi il criterio dell’offerta economicamente più vantaggiosa ha anche una funzione di "apprendimento". 


E tuttavia, in alcune circostanze non è detto che una maggiore varietà di soluzioni accresca il benessere della stazione appaltante, soprattutto quando la competizione è di natura locale mentre il servizio deve essere erogato su un territorio più vasto. Come cittadini sareste d’accordo se, per esempio, i detenuti delle case circondariali avessero una composizione del menu del vitto molto eterogenea da regione a regione in virtù di esiti molto diversi delle gare espletate magari in maniera centralizzata, ma tra imprese (magari tutte PMI!) che competono a livello locale e che quindi potrebbero offrire - in virtù dei fatidici 30 punti tecnici - "soluzioni" molto eterogenee? 


Ma, forse, il paradosso più sorprendente è che in alcuni casi le stazioni appaltanti potrebbero preferire il criterio del prezzo più basso. In molte forniture (ad es., autoveicoli, fotocopiatrici e altro materiale informatico di largo consumo) il continuo avanzamento tecnologico  e la pressione competitiva, che spinge i leader di mercato a offrire soluzioni funzionalmente simili, non permette di differenziare i diversi beni disponibili sul mercato in modo così netto, quindi la stazione appaltante troverebbe razionale premiare criteri tecnici, ma con un peso molto limitato. Il vincolo 70-30 pone genera quindi un dilemma: sopprimere i limitati criteri tecnici premianti, adottando il criterio del prezzo più basso (con conseguenze in generale di minore partecipazione in gara); oppure "gonfiare" il peso di ciascun aspetto tecnico con il rischio di pagare un prezzo sensibilmente più elevato per un bene che è solo "marginalmente migliore" rispetto a quello dei principali competitor.  

Se è vero che le strade per l’inferno sono lastricate di buone intenzioni, allora il vincolo 70-30 ne è un degno esempio. Ma non perdiamo la fiducia in un secondo correttivo...

25/05/2018, 22:26



The-Myth-of-Sisyphus-/-Il-Mito-di-Sisifo
The-Myth-of-Sisyphus-/-Il-Mito-di-Sisifo


 



I have been incessantly using the metaphor of Sisyphus in my training sessions on the economic analysis of procurement, and particularly of public procurement. Albert Camus’ philosophical essay "The Myth of Sisyphus" - to which I am indebted for this blog’s name - maintains that life is "essentially meaningless, although humans continue to try to impose order on existence and to look for answers to unanswerable questions. Camus uses the Greek legend of Sisyphus, who is condemned by the gods for eternity to repeatedly roll a boulder up a hill only to have it roll down again once he got it to the top, as a metaphor for the individual’s persistent struggle against the essential absurdity of life. According to Camus, the first step an individual must take is to accept the fact of this absurdity. If, as for Sisyphus, suicide is not a possible response, the only alternative is to rebel by rejoicing in the act of rolling the boulder up the hill. Camus further argues that with the joyful acceptance of the struggle against defeat, the individual gains definition and identity". (borrowed from Encyclopedia Britannica)

To some extent - albeit not necessarily with the same nihilistic touch - individual civil servants as well as many public organisations working in public procurement may feel the same frustration in carrying out complex tasks under an often (seemingly) meaningless world of rules. I have now shared with them almost 13 years of problems, promised lands and, ultimately, the sheer impression that things get more and more complicated.

Thanks to many colleagues around the world, I have gather a massive amount of frustrations, but also of precious experiences. My humble purpose is to start sharing at least some of them with as a large audience as possible, and, to best of my abilities, to stay away from pointless and outlandish academic  discussions. 

It is a commitment before being a promise!




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