Commentary: Accountability and Maximizing the Value of Public Contracts

• Author: Barbara R. Johnson
• DOI: http://doi.org/10.1111/puar.12760
• Published date: 01 May 2017
• Date: 01 May 2017

Accountability and Maximizing the Value of Public Contracts 445

Public Administration Review,

Vol. 77, Iss. 3, pp. 445–446. © 2017 by

The American Society for Public Administration.

DOI: 10.1111/puar.12760.

Barbara R. Johnson has served in

public procurement leadership positions for

more than 34 years, currently as contract

administrator for the Ohio Department of

Rehabilitation and Correction, and provides

public procurement instruction services to

NIGP: The Institute for Public Procurement,

among other prestigious clients.

E-mail: brjohnson@columbus.rr.com

Commentary

A manda M. Girth has written a very

informative and instructive article, “Incentives

in Third-Party Governance: Management

Practices and Accountability Implications.” In it, she

posits that contract incentives (and penalties) are tools

for improving contractor accountability. In the process

of describing her research results, she has created

very useful methods of organization and insight that

management can use to analyze the appropriateness of

a proposed tool.

The “typology of contract incentives” provides

clear options when considering the use of formally

or informally applied incentives or penalties when

administrating contracts. The information in this

article will enhance incentive/penalty decision

making, given Girth ’ s succinct description of factors

such as the fiscal environment, agency culture, and

market competition.

With great insight, the author has paved the way to

further recommended research in this key area of

public administration.

Based on the enormous amounts that federal, state,

and local governments spend, public procurement is

an activity that should be given more attention. The

return on public resource investment is realized and

maximized with competent contract administration.

To achieve improvements in the delivery of public

services, programs, or enforcement, more study and

access to education in the field of public procurement

is needed.

As a practitioner, adjunct instructor, and author

on public procurement matters, I look forward to

continued work in this area. Contract administration

is a key activity to realizing the value of goods and/

or services that an entity has acquired. Within

the contract document, and then during the

implementation, key indicators measuring the

delivery of the contract inputs, outputs, payments,

and outcomes should provide both the procurement

professional (on behalf of the entity) and the

contractor with a plan for achieving success. Further,

a well-executed contract may also become a business

development opportunity. As a contractor performs

well for the public sector and works with experienced

procurement and project management professionals,

the contractor is better educated about delivering

goods and services for the public sector.

The author ’ s comment about third-party

accountability resonates with my procurement

practice experience. As we outsource programming

and so on, there is often very little oversight. The best

contract instrument is useless if the project manager

does not perform administration. In “Contracting for

Public Sector Services” (Lawrence Martin and John

Miller, NIGP, 2006), much is written about ensuring

successful contract administration using performance

indicators. It also includes instruction about the use

of incentives or penalties while stressing the need

for contract administrators to monitor and manage

contractor performance.

One of the largest investments even midsize public

entities acquire is enterprise resource planning (ERP)

systems for fiscal management. Deloitte ( http://www.

deloitte.ca ) shares that an information technology

research consulting company, Gartner, Inc., reported

in 2016 a failure rate somewhere between 55 percent

and 75 percent for ERP projects.

Further, Deloitte ’ s article “Plan the Trip: Project

Preparation Is a Make-or-Break Imperative” proposes

that “[w]hether your project is a few months or a

few years long, whether it ’ s an upgrade or a new

implementation, the financial and cultural well-

being of the entire organization is at stake, and the

associated costs of failure range from disruptive to

catastrophic.” That project preparation should be

well accomplished before the contract is considered

complete. A contract is supposed to represent a

“meeting of the minds.” Too often, it has been my

experience that information technology projects in

Barbara R. Johnson

Ohio Department of Rehabilitation and Correction

Accountability and Maximizing the Value of Public Contracts