Last week, the Auditor-General's Report highlighted four areas of concern for public sector entities namely: the administration of grants; tendering and management of revenue contracts; management of contract variations and related party transactions, as reported by Channel NewsAsia.
In particular, the Attorney-General’s Office (AGO) highlighted issues in revenue contracts, saying that, "These lapses raised concerns on whether the key principles of open and fair competition, and transparency, had been upheld." Other problematic areas mentioned were lapses in procurement, controls over information technology and the management of assets.
Government business is a staple of most marketing agencies in Singapore. The resurrection of these age-old issues then begs the question: have government agencies evolved for the better or for the worse over these past years?
Shufen Goh, principal and co-founder, R3 Worldwide, explained that when it comes to government pitches and contract management, the main issue lies in the lack of understanding of policy intentions and the executions expected of it.
She said, “The current policies allow government clients to issue tenders for retained service for multiple years, project-based services or assembling a roster. However, the most common tenders fall into project or roster duties. This may be unavoidable for some aspects of marketing that is extremely tactical and reactive."
According to Goh, this could hint at a lack of discipline in planning out marketing calendars amongst government agencies, which poses a grave concern particularly for agencies keen on partnering with government bodies.
Marketing has been reporting on the issue over the years, and as it seems, some industry players are reporting that government bodies are improving in the way they work with agencies.
Fiona Bartholomeusz, managing director, Formul8, recommended that the best way to be thorough in any areas of conflict is to “keep things simple and above board.”
Still, she added, “We have noticed a more stringent process being implemented in the past two years and understand that this probably has to do with the contract values being awarded.”
The issues go on
Some of the problems that continue to persist when it comes to dealing with government bodies largely have to do with do unclear expectations on the part of the government body.
Goh shared that some of the complaints that agencies frequently make are regarding poorly managed pitches, unclear briefs, unrealistic expectations and a lack of opportunity to engage clients to truly understand the requirements.
Moreover, Goh explained that the sheer volume of tenders poses an issue for both the productivity of the sector as well quality of output: “For instance, submitting a tender proposal in the marketing services sector takes many unbillable hours on the part of the agencies, as well as resources within the government agencies to evaluate.”
As for Kea Sui Hong, group account director, Y&R Singapore, he said that the agency’s scope of work, is often limited by the contract paper set up front prior to the proposal submitted by the agency. This makes it difficult for the agency to maneuver.
Kea said, “Especially in our industry, there is no “standard solution”, but we are often constrained by the tender requirements that were pre-approved. A variation in contract will take time to be approved due to the red tapes involved making government bodies less flexible when it comes to moving quickly to adapt to the market needs.”
Goh echoed this view, saying that, “Tenders for procuring services, particularly creative services, should be managed with a mindset change – that a strategic agency partnership is critical for great outcomes, as proven by successful private sector businesses like Unilever, P&G, Apple and Singapore Airlines.”
Furthermore, Kea noticed that some government bodies have been entering into a trend of having a panel of agencies for its businesses. “This makes it hard for any agency to be our client’s true partners. Pitching for every project impedes an agency from fully understanding the core aspects and issues in the market. The competition between the client’s panel of agencies becomes a game of chess rather than a favourable partnership with the client.”
Meanwhile, Bartholomeusz explained that government tenders can get somewhat tedious: “Every line item has to be substantiated and explained and sometimes the party involved understandably doesn’t have a clear understanding of the processes required in advertising and creative production.”
She also highlighted that SMEs face a heavier burden of having to front 5% of the contract total as a performance guarantee which is only returned when the contract has been completed. Instead, she recommended, “It should be an automated system where it is returned promptly, within 10 days perhaps as cash flow is always key to keeping a business healthy.”
So, have government agencies evolved for the better?
Bartholomeusz said, “They are in fact some of our best clients because they do respect that the work we do can be very demanding. Obviously with a lot of things being processed online, this facilitates the working process and it is also good that the costs negotiations and actual day to day work is delineated between different working parties.”
On the other hand, an industry player who spoke on the condition of anonymity highlighted that government agencies seem to lack consistency when it comes to their RFP documentation. He also complained of the persistent lack of transparency in detailing their reasons for awarding or rejecting a particular proposal.
Still, Goh remains optimistic about government agencies' willingness to adopt changes where there are areas of improvements to be made. She said,"Government agencies should lead by example and embrace greater emphasis on creative ideas.”
She recommended that government bodies be less bureaucratic with their demands in order to produce work that will truly resonate and inspire citizens.
Goh said, “We have a long way to go, but if the stars are aligned, Singapore has a track record of getting things done, so I’m optimistic best practice will be adopted if need for change is acknowledged.”