According to reports from The Times and a Panorama feature earlier this year Reverse auctions are leading to the demise of health care services for the elderly. Gathering few examples, not speaking to a procurement specialist and taking the viewpoints from suppliers who lost out in the auction may have somewhat led to a one-sided view, but it does highlight a serious issue.
In our experience the quality and standards required by an organisation from their suppliers, should not and does not suffer if managed correctly during an RFI/P and auction process.
The information gathered relating to highly sensitive issues of quality standards, minimum requirements, health & safety and legality should all be addressed before the auction even takes place, and only those suppliers who meet a highly detailed and watertight specification will then proceed onto the auction itself where yes price does become the focus.
Working with organisations such as Network Rail and a leading healthcare organisation (who recently ran a reverse auction for care home services) where these issues are critical, means that we work with our clients to ensure their specification is accurate and meets their business requirements.
It is not the tool that is at fault (according to the Times) but how the specifications are managed, the support and experience available and how it is communicated to those involved.
