Which Finnish municipality makes the most skillful use of the market's potential and makes procurements the most cost-effective? This was investigated in a survey conducted at the end of 2017. Oulu won the title of the best municipal customer in Finland, Imatra received an honorable mention
Oulu is awarded for its exceptionally long-term development work for a working customer-producer model. The city has also consciously created conditions for local SMEs to compete for their projects. It engages in market dialogue with entrepreneurs to find the best solutions and to develop its own operations as well. Oulu's nomination as Municipal Subscriber of the Year is historic, as it is known that municipalities have not previously been ranked based on their subscriber skills.
Oulu developed a customer-producer model for the technical sector already at the beginning of the 2000s. In that case, the public entity orders the service and either the municipality's unit or an external entity produces it. Operations are governed by contracts. The model brought significant savings and flexibility to service production. Before, almost everything was done by yourself. Now, about half of the street maintenance and the care of green areas is contracted out to private companies, almost 80 percent of the investments.
Oulu's own operations also became more efficient when own and private sector work started to be done at the same quality level and with the same procedures for requests for tenders, contracts and site meetings.
"The quality and price development of services has been monitored since 2002. At the beginning, own production was 120 percent more expensive than private production. Now we have managed to get rid of 10–15 percent, which is a great achievement", Oulu community leader Matti Matinheikki describes.
Honorable mention for Imatra - based on e.g. infrastructure condition inventory
An honorable mention was also given to Imatra in the municipal customer competition. Through its activities, it has shown that even a smaller municipality benefits from good procurement expertise. Imatra's admirable specialty is a thorough condition inventory of the street and water supply network commissioned by the city. Thanks to that, future expenses do not have to be guessed, but the repair debt can be reduced in the long term and by utilizing purchase services.
As in Oulu, Imatra also has the city's fixed expenses under control: professional staff or expensive machines are not kept on standby just in case.
At Imatra, infra experts were placed in the Kiinteistö-ja aluepalvelu joint-stock company. The operation reduced operating expenses by 20‒25 percent and the quality of work improved.
"Condition inventory, multi-year regional renovation projects and controlled planning and implementation of projects are key means of achieving good results in infrastructure construction. In the end, everything turns out for the good of the citizens and saves tax euros", Imatra's director of urban development Topiantti Ääks amount.
Entrepreneurs: There are big differences between municipalities
Many INFRA member companies have noted how differently the local SME sector is taken into account in different municipalities in the construction and maintenance of infrastructure. Both Oulu and Imatra have stood out to the advantage of companies.
"For example, Oulu has consciously created good conditions for SMEs to compete for city projects. Market dialogue helps here: the fact that the city openly communicates its intentions to acquire services from the market and listens to entrepreneurs' feedback and ideas. A functioning market, on the other hand, means more affordable services and a developing and growing business sector, which brings vitality to the area. When the company starts to succeed in the domestic market, the next goal is growth and expansion", Executive Director of INFRA Pohjoise Olli Airaksinen ponders.
"Both award-winning municipalities, both Imatra and Oulu, are certainly warmed the most by the fact that the recognition is now given by the interest organization of companies operating in the market, whose goal is working procurement models and the market," concludes Matinheikki of the city of Oulu.
The municipal customer of the year survey was organized at the end of 2017 by INFRA ry, which represents companies in the infrastructure industry in Rakennusteollisuus RT. From the proposed municipalities, the winner was chosen by INFRA personnel from local offices as well as from the central union in Helsinki. Even though the organizer was the construction industry, the goal is to generally highlight the key role of procurement expertise as a success factor in today's world. Procurement affects the health of the municipality's economy, the quality of services and the vibrancy of local business activities, and prevents the gray economy. Purchasing services significantly free up municipal money tied up in machines, premises and personnel. Through companies, the municipality keeps abreast of the latest and most efficient working methods and technologies.
MORE INFORMATION
Oulu:
INFRA Pohjoinen, executive director Olli Airaksinen, tel. 0400 382 655
City of Oulu, community leader Matti Matinheikki, tel. 044 703 2010
(See also archive story www.51.fi/Oulu1)
Imatra:
INFRA Southeast Finland, executive director Tuukka Liukko, tel. 0400 251 365
City of Imatra, Director of Development Topiantti Ääks, tel. 020 617 2204
(See also archive story www.51.fi/Imatra)