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Decentralized contracting eyes efficiency

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Greater efficiency, more opportunity.

That's what the Department of General Services said it's seeking in efforts to improve the state procurement process, which could mean far more opportunity for businesses to bid on projects.

But companies might prefer to see more centralized procurement to prevent problems and inconsistencies, even as the state seeks to improve the process.

DGS, which is responsible for overseeing state procurement of goods and services, has been using the Internet for bidding and awarding contracts for years, spokesman Troy Thompson said. Planned upgrades to the system this year could improve that process and make supplier registration more efficient, he said.

The department also has a pilot program to improve the request-for-proposal process and reduce the time it takes for companies to work through that, Thompson said. The pilot will have companies present in-person proposals to state agencies for better communication.

"The hope behind that is there will be a better understanding between what the state is looking for and what the bidder can provide," Thompson said.

However, some companies working with the state said the administration's decentralized procurement model is not always the most efficient.

"We haven't seen anything that has made a big difference," said Ruthann Black, president of Black Consulting Services Inc., a Cumberland County-based information technology company.

About 75 percent of the Hampden Township IT firm's work is state projects, either as a subcontractor with other companies or as the main bidder, she said.

Decentralized procurement can cause confusion among the departments as they work out logistics, she said. She was doing a walk-through on a project recently when she learned another company received earlier access. That gave Black Consulting less time to prepare its proposal, she said.

In many respects, it might be too soon to say for certain whether changes are having the desired effect of efficiency, she said.

"You go into different agencies, and they do everything a little differently," Black said. "That makes it difficult on the vendor community. I think things ran better when it was centralized."

Such problems can take time to work out, Thompson said.

"You don't always immediately see the improvements with these back-end changes," he said.

The administration has generated more measurable improvements in some areas of contracting efficiency. For example, it set a goal to reduce sole-source and emergency procurements by 5 percent, Thompson said.

"Those were highly inefficient, and we wanted to cut down on that," he said.

In 2010, there were 218 emergency purchases of critical goods and services for state operations that did not have time to go through the procurement process, he said. That was cut by 40 percent in 2011.

In 2010, there were 123 sole-source contracts. A year later, that number was reduced by 47 percent.

The numbers were high because there had been a breakdown in making sure everyone followed the procurement process, Thompson said. And following a bidding process can get the best price on any one particular contract.

Reducing sole-source contracts means more companies can do work with the state, but it doesn't always mean there will be huge cost savings, he said.

"It may not translate to dollar savings, but it makes doing business with the state more efficient when you follow the request-for-proposal process," he said.

State efficiency could bring more companies in to do government work, and they'll likely find help at the procurement technical assistance centers, or PTACs, which help companies find local and federal government work, too.

The caseload at the center covering the midstate isn't bursting at the seams.

"It's kind of an ebb and flow thing. Sometimes we have a lot of clients, and sometimes it's pretty slow," said Kristen Moyer, the principal program analyst with the Lewisburg-based Central Pennsylvania PTAC run by the Susquehanna Economic Development Association — Council of Governments, or SEDA-COG.

But still, companies need that assistance, because they aren't familiar with every regulation or guideline for doing business with the state.

"It's our mission to help them wade through all the red tape," Moyer said.

Jim T. Ryan

Jim T. Ryan

Jim T. Ryan covers Cumberland County, manufacturing, distribution, transportation and logistics. Have a tip or question for him? Email him at jimr@cpbj.com. Follow him on Twitter, @JimTRyanCPBJ.

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