Chapter 3. ICT procurement and commissioning for coherent policy implementation in Argentina

Introduction

Building a digital government requires strong foundations to support the capacity of the government to ensure accountability and efficiency in terms of ICT expenditures, and to build a talented public sector, which is ready and capable of translating policy goals into coherent policy implementation.

Openness and accountability are needed in relation to where, how and on what projects public money is spent. OECD countries like the United Kingdom are leading a new whole-of-government perspective that places iteration at the core of the ICT procurement cycle as means to evolve from traditional public sector procurement approaches to the commissioning of ICT goods and services. This evolution requires a cross-cutting approach supported by the development of common standards for ICT project development, management and evaluation, and agile monitoring and control.

Such an agile environment relies on new forms of collaboration between the public sector and non-governmental actors, thus acknowledging the benefits of involving all relevant players early in project planning and development as a means to ensure that ICT projects comply with central standards and take into consideration the needs of the end user. The goal is to ensure that public funds are invested in ICT projects that create benefits for the public sector, businesses and citizens and help build a capable and responsive public sector.

The 2014 OECD Recommendation of the Council on Digital Government Strategies is clear in relation to setting “checks and balances” in the framework of ICT project expenditures; developing business cases to ensure coherent policy implementation and justify public investments; and managing, monitoring and evaluating projects’ implementation and results (OECD, 2014a).

This chapter assesses the state of ICT project planning, management and evaluation in the Argentinian public sector in line with the provisions of the OECD Recommendation and provides evidenced-based strategic policy advice to the Argentina government towards a more structured and agile approach to the development, management, procurement and commissioning of ICT projects.

From ICT procurement to ICT commissioning

There is a growing understanding among OECD member and partner countries on the need of moving from traditional approaches on public procurement to one that is more focused on the goals and long-term benefits of public projects beyond economic measures (e.g. the value of ICT projects to public service delivery). This approach:

• requires greater investments in the planning stage of the procurement cycle to ensure the realisation of benefits in the longer term, and better prevention and management of the procurement cycle as a whole (OECD, 2017c)

• implies the involvement of different players at the different stages of the traditional ICT project development, procurement and evaluation process (Figure 3.1).

This agile approach, known as ICT commissioning, calls for the implementation of more open, inclusive, iterative and cyclical approaches in the procurement of ICT products and services. This means, for instance, bringing on board all of the relevant stakeholders to jointly design projects and define ICT project priorities together; creating marketplaces to facilitate the pooling of suppliers; and monitoring and reporting on early results in an iterative fashion, as well as the revision and redesign of the project implementation process when needed (Figure 3.2).

The scale and costs of ICT projects are also factors that affect the level of control and involvement of specific actors, especially those in charge of assessing a project’s early benefits, ensuring their compliance with central standards and with power to intervene if needed.

Figure 3.1. Traditional ICT project design and procurement: Main stages

Source: Based on information from OECD (2014a), Recommendation of the Council on Digital Government Strategies, www.oecd.org/gov/digital-government/Recommendation-digital-government-strategies.pdf and OECD (2017c), Public Procurement in Chile: Policy Options for Efficient and Inclusive Framework Agreements, https://dx.doi.org/10.1787/9789264275188-en.

Figure 3.2. ICT commissioning: A model for public sector institutions

Source: Smith, W. (2018), “ICT commissioning for improved citizen-driven service delivery”.

Planning and approval of ICT projects

The current central administration has made an effort to bring some order to how ICT projects are planned and approved at the central level. The National Office of Information Technologies (Oficina Nacional de Technologías de la Información, ONTI), under the Secretariat for Digital Government and Innovation Technology, within the Government Secretariat of Modernisation (Secretaría de Gobierno de Modernización, SGM) leads these initiatives, focusing mainly on the project planning and approval stages.

ONTI’s activities aim to bring further order and standardisation to the development of ICT projects, with a focus on their long-term sustainability.

Results from the OECD follow-up mission to Buenos Aires in July 2018 and the OECD Surveys on Digital Government, administered for the purpose of this Review (2018) indicate that ONTI has developed soft policy instruments, such as the Decálogo Tecnológico (Box 3.1), as means to provide greater coherence to the ICT project planning and development process. The Decálogo sets ten principles that public sector organisations can follow to better design their ICT project proposals in order to submit them for ONTI’s certification in line with ONTI’s standards and guidelines (Box 3.1).

In addition, ONTI has developed the Technological Standards for the National Public Administration (Estándares Tecnológicos para la Administración Pública Nacional, ETAP), which provide a set of guidelines for the development and procurement of digital services and products. These, in turn, are intended to promote the adoption of common ICT equipment in order to enhance integration and sharing across the public sector to improve the efficiency and effectiveness of the provision of digital services. The aim is also to promote transparency, improve the management of public funds and optimise economic procedures.1

ONTI has also developed some other requirements to guide and standardise how public sector organisations develop their ICT project proposals, namely the Standardised Technical Requirements (Requerimientos Técnicos Estándar, RTE), and the Complex Technical Requirements (Requerimientos Técnicos Complejos, RTC).

The RTE and the RTC stand as standardised business case models for ICT projects with different levels of complexity. The RTE format is simpler in terms of the information organisations should submit, while the RTC targets those projects with a higher degree of complexity. These formats explore, for instance, the alignment of ICT project proposals with ONTI’s guidelines, the use of cloud services, non-proprietary software, and assess the expected costs, duration of the project, interoperability with other existent services and how the project is expected to share data (e.g. through application programming interfaces) in later implementation stages (OECD, 2018b).

All public sector organisations at the central level are required to submit a business case for their project for review by ONTI using either the RTE and the RTC online formats. Once submitted, ONTI analyses the information and issues a certification on the project (dictamen técnico). This process takes from two to ten days depending on the complexity of the project and the need for follow-up.2 This practice is in line with the OECD Recommendation on Digital Government Strategies, and follows the example of countries with higher levels of digitalisation of their administrations.

Evidence points to the fact that ONTI’s activities are largely focused on the alignment and the standardisation of ICT projects, with a focus on the adoption of technology, and the approval process itself in compliance with the Decálogo’s principles. Yet, the process overlooks control after the approval stage, alignment with data and digital services standards, and the overall benefits of ICT projects for citizens (e.g. in terms of public service delivery).

For instance, while it is mandatory for public sector institutions to follow ONTI’s certification process using either the RTE or RTC formats, the recommendations included on ONTI’s final certification or dictamen are not of mandatory observance (OECD, 2018[1]).

While one could not expect all projects to be aligned with ONTI’s guidelines, the use of thresholds and the early involvement of ONTI could be considered an addition to the current process in order to bring further order, coherence and control to the overall ICT commissioning process.

Results from the survey that was administered for the purpose of this review indicate that to date the central government does not use budgetary thresholds to structure the governance process related to the approval of ICT projects (OECD, 2018b). This is in conflict with OECD practices, where data for 2014 show that 80% of OECD countries at the time were using these instruments to better govern ICT projects across the broad public sector (OECD, 2014b).

For instance, in France, the Method of Analysis and Scalation of Value (Méthode d’Analyse et de Remontée de la Valeur, MAREVA2), created in 2007, defined an economic and strategic analytical framework for ICT projects.3 MAREVA2 focuses on benefits rather than costs. The use of the MAREVA2 framework is mandatory for those projects with an expected cost equal to or higher than EUR 9 million.

A similar case is that of Portugal, where all benefits arising from the implementation of potential ICT projects are framed in the scope of the elaboration of the ICT strategy and sectorial plans. Ministerial representatives, in collaboration with the other relevant bodies, quantify not only investment and implementation costs, but also the expected generated savings and benefits of each project using a Standard Cost Model (OECD, 2018c). All ICT projects with a threshold of EUR 10 000 are submitted for a pre-evaluation process, and require the mandatory approval of the Portuguese Agency for Administrative Modernisation, and the related alignment with the guidelines defined by this agency.

It also seems that scalability of impact is missing in terms of how ICT projects are expected to contribute to the overall goals of the Digital Agenda and benefits for citizens, regardless of their alignment with ONTI’s guidelines and expected costs (Box 3.2).

For instance, during the workshops organised by the OECD in Buenos Aires in July and December 2018, some stakeholders expressed the need of scaling up current efforts in order to make the development of a yearly ICT investment plan mandatory while ensuring the early involvement of ONTI in the development phase of ICT projects.

Other stakeholders expressed the current focus on the adoption of technology (e.g. aligned with ONTI’s guidelines) instead of an approach that focuses on the value that the use of technology by public institutions would bring to the public sector, the economy and the society as a whole.

In the United Kingdom, for example, the Government Digital Service established spend control to make sure the needs of the people are considered when defining ICT projects, therefore providing greater value for money. Spend controls also provide greater control and oversight (OECD, 2018c) of ICT expenditures and reinforce the alignment of any new services with the guidelines set by the UK Government Digital Service as any potential new projects related to digital services are assessed by this agency.4

Argentina, like many OECD countries, also faces the challenge of involving stakeholders from outside of the public sector in the development of business cases for ICT projects. Doing so would bring further clarity on the expected benefits those projects would have for citizens. The involvement of external actors in the development of ONTI’s guidelines (e.g. such as the Cloud Framework Agreement, and the use of artificial intelligence in the public sector) sets a positive precedent in this regard.

For instance, in the United Kingdom, the HM Treasury’s Green Book provides guidance to public sector organisations on how to involve stakeholders in the formation of a business case,5 which, as a result, can help build a stronger evidenced-based case of the need for funding one specific project (OECD, 2014b). ONTI’s business case model currently does not contemplate such an approach.

ICT Procurement

It seems that beyond ONTI’s work, there is a clear lack of a comprehensive ICT procurement or commissioning strategy for the central government, which would scale up ONTI’s efforts from the project level to the policy level, and govern the whole ICT commissioning cycle, from ICT project design to procurement, evaluation and realisation of benefits for citizens. There is therefore a need, as also expressed by stakeholders during the OECD workshops, of implementing a unified and holistic vision in terms of the design, procurement, management and evaluation of ICT projects.

ONTI’s role starts at the project design and approval stage and stops once the dictamen is issued and the mandate related to the government public procurement system falls under the responsibility of the National Contracting Office (Oficina Nacional de Contrataciones, ONC). As such, the ONC is the main agency in charge of ensuring that the government’s procurement processes comply with national procurement regulations.

The ONC is also in charge of the management of the Argentinian public procurement platform COMPR.AR (comprar.gob.ar). All public tenders (including for ICT projects) must be published on this public procurement platform. Yet, there is lack of causality tracking that allows ICT projects to be followed from the earlier conception stages to their procurement, management, monitoring and finalisation.

As of February 2019, ONTI and the ONC were exploring the possibility of further linking the two agencies’ processes (making the submission of ONTI’s certification a mandatory part of the procurement request file submitted to the ONC), but there is still room for improvement. For instance, the RTE and the RTC projects’ unique identifiers seem disconnected from those of the procurement platform, therefore making it impossible to track a project’s life cycle (from conception to finalisation) and of using standardised data to carry-out advanced data analytics to inform a more evidenced-based and data-driven decision-making process.

Results from the survey administered for the purpose of this review show that open tenders are the most frequently used method for the procurement of ICT goods and services among those organisations that provided a response to the survey (Figure 3.3). Further data indicate that open tenders are mostly focused on the development of capacities inside public sector organisations (e.g. in-house development of products), data analytics, and/or the design of mobile applications or off-the shelf solutions (OECD, 2018a).6

Yet, while as of March 2019, ONTI was in the process of developing a framework agreement in the context of the use of the cloud in the public sector, results from the survey also show the need for scaling up these efforts and following a government-as-one-client approach in regard to the commissioning of ICT products and services. The data indeed highlight wide differences between Argentina and more advanced OECD countries in terms of the use of framework agreements for the procurement of ICT goods and/or services.

Figure 3.3. Most frequently used procurement methods in Argentina: ICT goods and services

Number of institutions

Note: Number of institutions providing an answer to the question: Please indicate to what extent your institution uses the below procurement methods to buy ICT goods/ICT services.

Source: OECD (2018a), “Digital Government Review of Argentina: Survey for Public Sector Organisations”.

For instance, evidence from the 2017 OECD Digital Government Review of Norway revealed the total opposite situation of that present in Argentina. In Norway, roughly 90% of public sector organisations reported the use of framework agreements for the acquisition of ICT products and services. Norwegian public sector organisations reported that direct purchases were rarely used (OECD, 2017a).

This challenge was also raised by stakeholders during the workshops organised by the OECD in July and December 2018, when actors from the public sector expressed the need of “identifying common digital resources and tools to follow a government-as-one-client approach for procurement”, and to “enable global procurement” through the use of framework agreements that benefit transversal projects.

Management of ICT projects

A lacks of clarity was also observed in terms of management, monitoring and control throughout the whole ICT project commissioning cycle (from ex ante approval to finalisation).

Argentina lacks of a standardised model for the management of ICT projects at the central government level (OECD, 2018a)7. There are several examples from OECD countries using a standardised management approach that could help the Argentinian government explore the potential adoption, adaptation and implementation of these tools to its specific national context in order to achieve efficiency and agility that are more coherent across the public sector. For instance, in Denmark, the Agency of Digitisation created the Cross-governmental ICT Project Model as an effort to harmonise how public sector organisations manage their ICT projects.8 The Danish model clearly connects all the stages of the whole ICT project life cycle (from the conceptualisation of the project to realisation of benefits), providing clear guidelines on the differences in terms of the requirements that should be fulfilled to move from one stage to the next, and the need of clarity in terms of responsibilities and roles. Other OECD countries such as Belgium, the Czech Republic and Ireland have instead adopted common project management approaches, such as the Projects in Controlled Environments (PRINCE/2) project management model (OECD, 2018d)(Box 3.3).

Following an agile approach: Towards ICT commissioning

The opportunity at this stage is not only related to the further adoption of ICT project management practices in the public sector, but in terms of avoiding adopting and/or duplicating practices that might become obsolete in the medium- or long term.

OECD countries are increasingly acknowledging that some of the existing ICT procurement management practices and methodologies (e.g. waterfall management) are becoming out of date as new delivery approaches (e.g. agile and DevOps) become the norm in this area. Indeed, during the OECD workshop organised in Buenos Aires in December 2018, stakeholders expressed the need for a “flexible procurement and management model” as an area of opportunity.

For instance, in the United States, the introduction of agile contract formats has enabled the US government to create simple, effective contracts that take advantage of post-award agile methods to procurement. This work, led by the US Technology Transformation Services’ Office of Acquisition, is focused on increasing the adoption of an agile contract format that changes the commissioning process approach from one that is clear of what suppliers are expected to do in regard to one specific project, instead of prescribing how they should do it (UK GDS, 2018). This gave the commissioning and post-award process greater simplicity, efficiency and agility by making sure a focus on delivery was adopted across the whole project commissioning and management process.9

Likewise, both New Zealand and the United Kingdom (Box 3.4) have adopted more flexible approaches in terms of supplier selection, establishing marketplaces that help suppliers apply to specific project calls easily, cutting costs across government and creating a more dynamic market environment (UK GDS, 2018).

The OECD Working Party of Senior Digital Government Officials (E-leaders) is working with OECD countries to explore new ways of commissioning and managing ICT projects in line with the latest developments across OECD countries in this domain. The goal is to equip governments with procurement practices more in line with the needs and trends of the digital age.

For this purpose, the OECD partnered with the UK Government Digital Service to produce the ICT Commissioning Playbook in the context of the E-Leaders Thematic Group on ICT Commissioning. The Playbook provides a set of actionable guidelines (known as plays) that countries can follow to move from traditional procurement methods to the commissioning and management of ICT projects, drawing upon relevant practices across OECD countries (Box 3.5).

Control and evaluation of ICT project expenditures

The absence of a holistic strategy on ICT procurement (or commissioning) also has an impact on how ICT projects are controlled and how results are assessed, if done, by the relevant bodies. ONTI’s efforts aimed to implement a focus on the sustainability and life cycle of ICT projects, but there is no clear evidence that there are relevant accountability mechanisms in place to control project development and evaluate expectations vs. real results in an iterative fashion.

In general terms, evaluation of projects can take place at the ministerial level of the unit (unidad ministro) or in the framework of the activities of the National Audit Office (Auditoría General de la Nación). However, this does not seem to be the common practice in terms of ICT projects. Also, the SGM does not have a specific role in terms of project evaluation, and no other agency has the mandate of monitoring the benefits and impact of ICT projects (OECD, 2018b).

Argentina needs to explore and decide on the level of central control that is needed to ensure the accountability of ICT projects at the operational level and the contribution of those to the overall digital agenda in the country. At this stage, it is necessary to differentiate between minor-scale ICT commissioning projects and those of more strategic value; the level of central control and monitoring could differ from one the other. However, control and alignment with the broader digital government policy is required in both cases.

The Argentinian government could learn from the experience of OECD countries in this regard. For instance, in Israel, public sector organisations are expected to fill a specific reporting format to inform the head of the ICT Office on the status of ICT projects. In Portugal, the Reporte TIC online platform10 is used by public sector organisations to report on the level of development of digital initiatives in line with the operationalisation of the ICT strategy.

In Norway, the funding model and source of ICT projects is also a factor defining the reporting mechanism. For those projects that have received funding as part of the regular budgetary cycle, reporting is made through the relevant budget report. However, for those projects receiving funds from the Norwegian Digitalisation Agency, monitoring and reporting are done using the agency’s Project Wizard tools and guidelines.11 The use of conditioned funding gave the Norwegian Digitalisation Agency greater auditing control over ICT projects, making public sector organisations accountable for their results and bringing greater coherence in terms of the overall value of these projects for the digitalisation of the public sector.

In the United Kingdom, the Infrastructure Projects Authority monitors those ICT projects that are in the Government Major Projects Portfolio. Projects fall under this description in line with their contribution to four categories, including two specific categories clearly linked to digital government efforts12 (UK IPA, 2018):

1. 1. transformation and service delivery: “Projects help improve the relationship between citizen and state, harness new technology to improve public services and make government more efficient”

2. 2. information and communications technology: “Projects […] for achieving cost savings and efficiency […]. Many of the ICT projects on the portfolio enable the transition from old, legacy contracts to new ICT provisions”.

In Argentina, the SGM, through the relevant sub-body, could also fulfil an important role monitoring and evaluating project performance and helping to allocate ICT budgets for each ministry strategically, which is a point raised by central government respondents to the OECD survey. In the near future, the role of the SGM as an advisory entity could be largely untapped. The value that can be generated by positioning the SGM in such a role will grow as it formalises government-wide strategies that can serve as the criteria and guiding force by which its advisory decisions are based; and in line with OECD good practices, thresholds could be set requiring the SGM’s approval.

ICT project monitoring and evaluation at all scales should be a priority, particularly in light of the overall open government and anti-corruption agenda for the country and the need to strengthen a public sector measurement, performance and delivery culture in the long term. The UK has for instance prioritised the modernisation of its procurement process to embed in the entire commissioning open government principles.