To Improve Benefit Delivery, States Should Adopt a Minimum Viable Procurement Process (Dahna Goldstein)

To capitalize on innovative approaches and the firms that bring them, states should take a page from the tech startup world to adopt a minimum viable product (MVP) process and apply it to procurement practices. MVP is an established technology development technique where a new product or website is developed with sufficient features to demonstrate the concept, but the complete set of features is only designed and developed after considering feedback from the product's or site’s initial users.

The COVID pandemic continues to highlight the need for better and faster access to benefits, from pandemic relief funds to unemployment benefits. Existing state systems are cumbersome, complex, and sometimes glitchy. While both the federal and some state governments are trying to dedicate resources to modernizing systems, they will be best served by reforming procurement processes to invite and encourage innovative technological solutions to make access to benefits easier and more equitable.

There is an increasing recognition that innovative technology solutions can help beneficiaries access needed services, yet existing procurement processes all but exclude the types of companies that are best positioned to create innovative solutions. In addition, overly complex and rigid requirements, unduly lengthy lists of terms and conditions, and long sales cycles deter nimble startups from participating in government procurement processes, as does a perception that large incumbents hold an insurmountable advantage in RFP and procurement processes.

In this case, with state IT software solutions, governments could take a similar approach to design a scaled-back procurement process that would minimize submission requirements; streamline the application, review, and contracting processes; cut upfront cost commitments; and encourage innovation. This approach would make the process more competitive and more accessible to startups and smaller and M/WBE vendors, and enable the solution designers to validate an idea or concept in service delivery to better meet customer needs.

An MVP process would:

• Shorten both RFPs and the sales cycle significantly by stripping out any requirements and terminology that create unnecessary barriers for startups, small businesses, or other companies not steeped in government contracting;
• Modularize contracting by breaking large contracts into their component pieces and offering microservices that leverage the most innovative solutions to specific elements of a given benefits delivery process. Smaller projects create opportunities for smaller players, rather than creating conditions that can be met only by large incumbents. This also enables government agencies to place smaller bets, thereby also encouraging innovative solutions; and
• Implement agile contracting to make the process more accessible to smaller companies that may not have the deep pockets and legal benches currently required to contract with many government agencies.

Contracting agencies could use the minimum viable procurement process to learn how best to facilitate innovation in designing, developing, and delivering new benefits systems. They would also need to adopt new key performance indicators (KPIs) to evaluate the progress and performance of the benefits systems.

Adopting a minimum viable procurement process is only one part of the solution to improving access to benefits. Benefits systems need to be human-centered while protecting data privacy and security, and integration with—or smooth migration from—legacy systems is challenging. But the need for better, faster, and more equitable access to benefits is too important not to create conditions for innovative startups to be part of the solution.