Enhancing performance measurement of public procurement processes through the application of procurement delay index

Abstract

Considering procurement process performance assessment, measurement systems such as balance scorecard and capability maturity models are used to assess procurement performance to give a reasonable indication of actual performance. These tools are ideal for practical applications that depend on other performance criteria but are short of comparing planned to actual timelines set for procurement processes. This fosters persistent delays in public procurement. Six Sigma implementation benefits including addressing process delays have fostered its implementation for service improvements. Unfortunately, Six Sigma implementation in public procurement is very rare largely due to its expensive nature. The objective of this study is to develop a Procurement Delay Index (PDindex): a performance measure in the context of a Six Sigma methodology that provides a specific value to describe the delays in the procurement process. To enhance uniformity in performance measurement of process timeliness, a rating scale for determining the timeliness of the procurement process is proposed. A practical demonstration of the application of PDindex for use by procurement professionals is also presented. PDindex serves as a standard by which to determine procurement processes’ timeliness and is less expensive to implement. A PDindex of 3σ has been recommended as the acceptable limit for procurement process delays.

Keywords

• Delay
• Performance measurement
• Procurement delay index
• Timeliness