Challenges In Information Systems Procurement in the Public Sector

Public procurement constitutes a large part of the market in many countries, and it has the potential of playing an important role in stimulating communities and serving policy goals. With this in mind the governments have set regulations for public procurement. Procurement of Information Systems is especially challenging due to the complexity of procuring unknown technology and the importance an information system has for different stakeholders in an organization. Public procurement of information systems (IS) and services provides several challenges to the stakeholders involved in the procurement processes. However, these are not well established or understood, and there is a knowledge gap that needs to be covered. This paper presents results from a Delphi study, which involved 46 experienced procurement managers, chief information officers, and vendor representatives in the Norwegian public sector. The participants identified 98 challenges related to IS procurement, and subsequently ranked the relative importance of the top issues. The study supports findings from previous research related to diverging stakeholder goals; challenges in balancing between objectives; in requirement specifications; and in too narrow cost focus. In addition to providing empirical confirmation of these previous propositions the study revealed new findings, such as benefits realization in IS procurement; coordinating and standardizing public procurement processes; complex and constraining government regulations; issues of technological integration and compatibility; and inter-municipal cooperation. Developing clear requirements specifications stands out as critical for public sector officials. The results provide a rich overview of IS procurement challenges in the public sector in Norway, and may also give a good picture of challenges in other countries with similar procurement regulations.