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When It’s Tech + Infrastructure, It’s Time to Rethink Procurement

Digital solutions can modernize construction, increase safety and improve return on investments. But the traditional ways of purchasing and contracting are unsuited to the rapid pace of technological change.

Researchers install deformation sensors beneath a bridge
Researchers install deformation sensors beneath a bridge spanning the Big Muddy River on Illinois Route 127 between Murphysboro and Carbondale. The researchers were experimenting with wireless sensor technology that could monitor the ongoing condition of the bridge in real time. (Southern Illinois University, Carbondale)
Recent waves of federal funding and rapid technological breakthroughs combine to create a once-in-a-generation opportunity to address America’s aging and dangerous infrastructure, but that opportunity is directly confronting the hard realities of government procurement capacity. There are approaches that could help public officials deal with these procurement realities.

Digital infrastructure, including Internet of Things (IoT) devices like sensors, cameras and related tools with analytics capabilities, can change the way cities build, utilize and maintain their streets, sidewalks and parks. The U.S. Department of Transportation, in its Strengthening Mobility and Revolutionizing Transportation (SMART) Grants Program, shines a spotlight on this potential by specifically setting aside funding for sensors, system integration and smart-grid or traffic-signal connectivity projects that demonstrate the benefits and value of digital approaches.

But while incorporating digital solutions can modernize physical construction, increase safety and improve return on investments, it also creates a storm of complexity and surfaces new issues such as data ownership, security and privacy. Procuring technology presents a special class of problems for both program and acquisition officials. First, they often lack experience with newly developed hardware and software options. Second, city teams can be at a knowledge disadvantage compared with vendors. And third, government needs to deal with too-lengthy acquisition cycles in a world where change is constant. Procurement shops across the country, always under the microscopes of the press, senior officials and disgruntled vendors, now have way more demands on their time than they have capacity.

These problems may seem intimidating, but they’re by no means insoluble. Thanks to support from the Knight Foundation, our program at the Bloomberg Center for Cities at Harvard University and the Open Mobility Foundation is assisting several cities with SMART grants that will enable them to utilize digital platforms that improve sidewalk and curb management, mobility and commercial delivery practices. Key to getting this infrastructure right is getting the procurement right.

These SMART-type projects require interoperability among private-sector vendors inside a set of rules set out by government. Therefore, to some extent they can rely on the structures and principles of public-private partnerships while at the same time recognizing the difference in the characteristics of digital procurements. The intangibility of digital infrastructure makes defining quality more difficult, but technology is more easily scalable and can serve multiple users — “multitenancy,” as it’s sometimes called. These features, as well as the ways digital systems further engagement and equity, are more fully explained in our papers Toward a Smarter Future: Building Back Better with Intelligent Civil Infrastructure and Implementing Digital Infrastructure Responses to Equity, Sustainability, and Safety.

Transformation only occurs if it starts with an explicit consideration of how the project will produce public value. The first step for cities should be about the goals of the project, including equity, sustainability, the quality of neighborhood life and the ability to make dynamic and continuing changes in use. The most powerful transformations and most lasting value occur when officials conceptualize, buy and build at this system level — for example, looking at mobility as an integrated system rather than separately considering parking, taxis, ride-share services and scooters. Requests for proposals need to be written to procure innovative solutions with more attention to outcomes and less prescription in how the vendors get there.

Program and procurement officials will next need to consider which part of the solution to bundle into one procurement and which if any pieces need to stand alone. In concept, this issue is no different from when a city decides which subcontractors to put under a general contractor when constructing a building or bridge or wastewater plant. Yet in this case the specifications and negotiation with the winner will need to address interoperability among multiple vendors. The complexities of the new combinations of physical and digital procurement mean that governments will also need to engage outside advisers on issues such as data privacy, security and ownership. One other distinction will surface when scoring proposals: Upfront costs and life-cycle costs may diverge; for example, IoT sensors may add to upfront costs but produce substantial long-term maintenance savings.

Speed counts, and therefore the process should consider either pilot solicitations, such as those utilized by Long Beach, Calif., in its Pitch Long Beach! program, or a form of progressive P3s that allows a selection of a qualified partner even as the scope and pricing evolve. These expedited contracting approaches are discussed in our new white paper Procuring Digital Infrastructure: How System Approaches Can Produce Public Value, written to support and guide local leaders through digital infrastructure procurement on the system level.

Other items requiring careful consideration include ensuring that incentives don’t conflict, streamlining the digital engagement process and, for when it’s necessary to remove a vendor, avoiding needlessly complex off-ramps.

One thing is clear: More of the same legacy procurement processes will not work, either for those doing the acquisitions or for the community, which rightfully expects more engagement, more safety and equity, and more useable infrastructure. Lasting value requires cities and counties to rethink their goals while modernizing their acquisition procedures.

Governing's opinion columns reflect the views of their authors and not necessarily those of Governing's editors or management.
Stephen Goldsmith is the Derek Bok Professor of the Practice of Urban Policy at Harvard Kennedy School and director of Data-Smart City Solutions at the Bloomberg Center for Cities at Harvard University. He can be reached at
Betsy Gardner is the editor of Data-Smart City Solutions at the Bloomberg Center for Cities at Harvard University.
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