Procurement Situation Research Articles

Trends in maintainability and reliability of avionic systems with particular reference to DCAD Technical Publication 1/77

The paper reviews the procurement situation in respect of the reliability and maintainability aspects of the UK Ministry of Defence contracts prior to the introduction of the DCAD Technical Publication 1/77, discusses in general the content of the document and the translation of the document's principles into a form suitable for inclusion in contracts, reviews its application and gives some indications to the direction in which reliability and maintainability activities should proceed to meet the challenges of to morrow's systems.

Soliciting and evaluating bids for a complex big ticket item

This article reports on a procurement situation where a competitive bidding strategy is usually used. The situation is analyzed and described from the point of view of the procurement organization and not as it is usually done in the literature from the point of view of the bidders. After a brief section on the background, the article concentrates on the design of the procurement process and the actual procurement, concluding with an evaluation of the decision-making process.

French and German summaries

Intermediation in innovation serves to establish or improve the link between different actors with complementary skill sets or interests in order to support the generation and diffusion of innovation. This article conceptualises and analyses intermediation between supply and demand using the example of public procurement of innovation. It defines specific intermediation needs and functions in different procurement situations and outlines the pre-condition for effective intermediation. The paper combines and contributes to the growing literature on innovation intermediation and public procurement of innovation.As the paper looks at the demand for innovation it adopts a broad understanding of innovation, defined as a product, service or process that is novel to the buying organisation. In order to develop the conceptualisation of intermediation in the process of demanding innovation, it builds on the existing, rather rudimentary conceptualisation of intermediation in the innovation and management literature. It presents an in-depth analysis of two very different procurement processes in two cases in a complex public sector setting, the English NHS, case of a public buying organisation triggering the generation of an innovation, and another in which an organisation sought to respond to an innovation offered in the marketplace. In both cases, the solution bought necessitated strong adaptation processes with considerable learning costs within the buying organisation. The paper shows how intelligent and tailored intermediation can tackle some of the well-known procedural and capability failures in the process of public procurement of innovation. In terms of policy implications, the article makes the claim for an increased effort to build up effective intermediation across procurement systems to support agencies in concrete procurement and, in doing so, to build up capacity for more intelligent public buying. While the focus on intermediation responds to an existing gap in the literature on public procurement of innovation, the paper has implication for demand-supply intermediation more generally.

Pricing Policies Contingent on Observed Product Quality

Expanded use of incentive contracts has created interest in procurement arrangements in which unit purchase price varies as a function of observed product quality. Under the assumption that at a known cost, a producer can control the true quality of his output, a production and procurement situation is described in which a riskaverse producer and consumer both attempt to maximize expected profit-the consumer by selecting a pricing strategy and sample size, and the producer by then selecting the product quality. Let product quality be denoted by p. The consumer will desire the selected product quality to be some p*. If at a fixed sample size, n, a price schedule exists which is acceptable to the risk-averse producer and also maximizes producer expected profit at p*, this price schedule is a “motivating” price schedule. For fixed (n, p), a motivating price schedule must be the solution to a specified linear programming problem. It will be a piecewise constant function of the observed quality and need have n...

Pricing Policies Contingent on Observed Product Quality

Expanded use of incentive contracts has created interest in procurement arrangements in which unit purchase price varies as a function of observed product quality. Under the assumption that at a known cost, a producer can control the true quality of his output, a production and procurement situation is described in which a riskaverse producer and consumer both attempt to maximize expected profit-the consumer by selecting a pricing strategy and sample size, and the producer by then selecting the product quality. Let product quality be denoted by p. The consumer will desire the selected product quality to be some p*. If at a fixed sample size, n, a price schedule exists which is acceptable to the risk-averse producer and also maximizes producer expected profit at p*, this price schedule is a “motivating” price schedule. For fixed (n, p), a motivating price schedule must be the solution to a specified linear programming problem. It will be a piecewise constant function of the observed quality and need have no more than six distinct price levels. A method of deriving continuous, piecewise-linear price schedules is briefly described, and extensions of the basic approach are noted.

An equipment manufacturer's problems in the application of microelectronics

Modern radar equipment relies increasingly on data processing and statistical probability when presenting target information. This equipment must be reliable, with rapid check out and servicing capability. Microelectronics can be exploited to give this capability, especially when small size and low weight are also prime requirements. The paper compares the cost and estimated M.T.B.F. of an equipment using: 1. (a) Conventional components with soldered connexions, plugs and sockets. 2. (b) Conventional components, welded joints, no plugs or sockets. 3. (c) Microelectronic circuits, welded joints, plugs and sockets. The expected trends of cost and reliability are discussed. For a complete military equipment, microelectronics offers comparable reliability at lower cost after mid-1964. The unsatisfactory although rapidly improving situation of procurement of suitable United Kingdom microelectronic devices is discussed. Finally, the paper gives a brief description of a small data processor and compares cost, power consumption and reliability of a conventional production model with an integrated network prototype.