Innovation procurement - why does it matter?

Innovation in the public sector is a prerequisite for meeting societal challenges and building sustainable welfare. Sweden also needs to have a well-functioning public sector in the future, and this includes the ability for its own innovation, but also innovation in collaboration with other actors and public demand for new solutions. A key factor is a well-functioning interaction with companies. This includes giving companies the conditions to scale and disseminate new solutions that can benefit public, but also private, markets.

Innovation thus plays a role in procurement, but in the same way procurement plays a role in public innovation. An important insight is that almost all innovation that the public sector does will involve procurement to some extent. Everyone who works with development and innovation projects in the public sector needs to consider whether and how public procurement can affect their project.

What is innovation procurement?

Innovation procurement is a process that begins when a public activities has identified a need or desire that is not covered by the range of goods and services that are on the market or that the business is aware of. This may be a need for new development, or that new solutions exist but are untested, or that solutions exist in another market and need to be adapted.

The innovation procurement process means that public organizations and innovative companies meet to collaborate in a procurement around new innovative solutions being developed, tested, adapted or verified.

It is a combination of traditional public procurement and experimental innovation projects, which requires skills of many kinds.

Innovation procurement is thus not a special methodology or procedure. The process is based on the same basis as other public procurement, but also on the same logic as in other types of innovation projects.

Read more about innovation and procurement on the Procurement Authority's website.

What distinguishes those who succeed with innovation procurement? Read the report Evaluation 10 project within innovation procurement (2019).

Current offers: innovation procurement for green conversion

Innovation procurement plays a role for the entire public sector, but the transition to a society within the planet's borders cannot wait. Therefore, our current investments in innovation procurement in the area of green conversion. We want to contribute to public procurement of new and sustainable solutions that contribute to society's green transition. It is crucial for our ability to make the green transition, for example, to meet the climate goals of net zero emissions by 2045 or to move to a bio-based, resource-efficient circular economy.

External competence in important decisions

A piece of the puzzle in innovation procurement is to link to external competence when the contracting organization needs to have a decision basis for a possible innovation procurement. The need for external expertise competence can also arise when you have already made a decision about innovation procurement, or are in the process of an ongoing innovation procurement. It can also be important to be able to use external test beds, laboratories, etc. in such situations.

Vinnova's call for proposals "Checks for innovation procurement" is for contracting organizations that experience such needs. As long as innovation procurement is about green conversion, all areas are relevant: procurement of electronics, infrastructure, food, buildings and building materials, recycling, services and lots more.

The call " Checks for innovation procurement 2022 - green conversion".

Procure development partners

Contracting organizations in need of newly developed solutions have several options. They can, for example, develop their own or enter into an R&D collaboration project with potential suppliers. However, there are disadvantages. It is not always most efficient for the public organization to own and manage a complete solution, either for the organization or for society. In collaborative projects, companies need to contribute with significant own efforts, future business is unclear and there is a risk of consulting fraud situations arising.

With the innovation partnership procedure, there is another possibility: to procure business partners for a joint development project. Following the procurement of one or more suppliers, the companies develop the new solutions in dialogue with the contracting organization. If the result meets objective regarding performance and costs, the solutions can be purchased directly from the companies / company. A new procurement is therefore not needed. Companies can receive compensation for their development work in the project, and since the procurement is carried out in competition, the compensation may, if necessary, exceed what would have been possible in a state aid project.

The strategic innovation program Bioinnovation has a call for proposals on innovation partnerships that will contribute to and benefit from the transition to a bio-based economy. It is aimed at contracting organizations and in step 1, the preparations for an innovation partnership are financed.

The call " Hypothesis testing and innovation procurement in the public sector Step 1,".