Public procurement of innovation (PPI)

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The government can use procurement as a way of encouraging the market to come up with innovative solutions. This can be done either by actively seeking an innovative solution or by offering market players the scope to provide innovative solutions. Innovation is vital for economic growth and progress. While innovative solutions are often more sustainable, they may also be driven by other considerations.

PPI explained

The government can engage in PPI in one of two ways – by providing market players with the scope to develop and/or offer an innovative solution or by conducting a targeted search for an innovative solution to its problem.

The term PPI is often confused with innovation procurement. PPI is results-led: an innovation is purchased. Innovation procurement, on the other hand, involves the use of innovative features when designing the procurement process. Innovation procurement processes are often used for PPI. These can also be combined. For instance, Erasmus MC used market consultation in conjunction with competitive dialogue (innovation procurement) to obtain a smart solution (PPI) from the market to solve the problem of how to clean all of its hospital beds.

Getting started with PPI

You can use your procurement policy to encourage the development of innovative solutions in the market. The difference between a regular procurement process and a PPI procedure lies mainly in the formulation of the requirement and the way you interact with the market.

Further details: Getting started with PPI