I've been waiting to comment on a recent piece that ran in Crain's Chicago Business regarding the just-enacted law authorizing reverse auctions in the State of Illinois. It appeared on July 12, 2010, and you can read the article here:
Illinois' new reverse-auction bidding process squeezes suppliers
Now, for a bit of backstory, as the head of the Reverse Auction Research Center and one of the leading academic experts in the area, I was interviewed by the story's author, Paul Merrion. Well, Mr. Merrion chose not to use my material and my quotes on the benefits of reverse auctions for the public sector and lots of details that I provided to him on what has been done successfully by national, state and local governments by shifting procurement spending to reverse auctions and introducing competitive bidding to replace opaque processes and "good old boy" deals. In the name of fairness and objectivity, while I spoke of the benefits and some potential pitfalls to avoid from "lessons learned" by other jurisdictions, I "stuck to my guns" in regards to my belief - based on a decade's worth of research and market monitoring - that reverse auctioning is a great fit for much of government spending. What Mr. Merrion chose to do instead was to feature the "insights" of Dr. Robert Emiliani, A Professor of Engineering and Technology at Central Connecticut State University. As anyone who has followed the reverse auction market knows, Dr. Emiliani has been a long-time critic of reverse auctions, and while so, Mr. Merrion chose not to include any of my mostly pro-reverse auction material/quotes, while allowing Dr. Emiliani to offer his opinion that: "(Reverse auctions are)It's bad for the state, it's bad for Illinois business. You're screwing your trading partner. How long do you think you can get away with that?"
I would have let Mr. Merrion's one-sided piece go, but now my friend Jason Busch at SpendMatters (http://www.spendmatters.com/) has - as an executive in the field with a great track record and yes, a resident of Illinois, has taken the article and the notion that somehow reverse auctions would be "bad" for his home state to task in a fantastic post, which you can read below:
When Reverse Auctions Come Up Against "The Machine" in the State of Illinois
Anyone and everyone who has a "dog in the hunt" regarding thinking about how to save money and introduce new levels of competition AND transparency in governmental procurement owes it to himself/herself - and to your agency AND to your constituents - needs to read this great rejoinder to the Crain's Chicago Business piece! By all means, forward this piece on to your colleagues and to your elected/appointed governmental officials and managers, not just in Illinois but around the country.
Game, set and match to Jason and to reverse auctions! For more on the truth about reverse auctions and what they can do in both the public and private sectors, become a follower of my blog - and Jason's (http://www.spendmatters.com/).
David
From the Reverse Auction Research Center: http://reverseauctionresearch.blogspot.com/
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