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There are too few contract and commercial managers – and that’s a problem

December 8, 2015

The future of public service is to manage contracts. That’s how The Economist (December 4th, 2015) sees the emerging role of government in the digital age. It highlights the growing spend on public procurement and increasing dependency on privately provided services. And it observes that ‘if managed well’ these contracted services are provided more cheaply – but that this demands advanced levels of oversight. The alternative is continued headlines about expensive failures and massive cost overruns.

The Economist does not question Government’s direction in placing more reliance on contracted services, but it does question its competence to manage performance. In many respects, I find this unfair. Of course Government cannot overnight transform its staff into contracts and commercial gurus, but at least in some jurisdictions they are trying. And if they slow the pace of change, they come in for criticism for failing to address financial reality.

The truth is that qualified contract and commercial professionals are in short supply because neither government nor industry anticipated the scale of need. Few companies have made substantial investment in this field. Exceptions – such as Accenture – appear to be flourishing. And rather than criticise government, what about the role and responsibility of the private sector to operate efficiently and with integrity? Why would government need to invest so heavily in oversight if its suppliers were competent and honest?

So the problem that I see is that neither government nor the private sector has yet adjusted to the realities and expectations of a digital world, in which agility, performance, global markets and reputation come together in a potent mix that calls for astute management, adaptable commitments and robust commercial judgment.

While IACCM continues to train and certify several thousand contract and commercial managers each year, it has been alone in this endeavour and right now, supply falls far short of market demand. Increasingly we also work to support in-house commercial competency centres and this will help boost the numbers, but rather than criticise government, The Economist might do better to turn the spotlight on industry’s failure to spot the emerging trends that are transforming the role and importance of contracts and the staff who negotiate and manage them.

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