What is innovation procurement?

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‘Procuring innovation’ is public procurement aimed at developing or purchasing innovative solutions. Innovative solutions may be new or highly improved products and services, but also new ways of working and organising.

The Programme for Innovation Procurement (PIP) distinguishes between:

  • the development of innovative solutions through the procurement of research and development services
  • the procurement of innovative solutions that are new on the market and still require validation
  • the procurement of innovative solutions that are validated but still have a limited (<20%) market share.

For each kind of innovation procurement PIP offers a different approach.  

The PIP approach is closely aligned with that of the European Commission. The European Commission distinguishes between:

  • Pre-Commercial Procurement (PCP) where the purchase concerns the development of an innovative solution, and
  • Public Procurement of Innovation (PPI) when the contracting authority purchases an innovative solution.

The process of developing and procuring innovative solutions has several phases:

  • Designing a solution and analysing its feasibility on paper;
  • Development of a prototype of the new product, system or process;
  • Testing the solution in a test environment, including developing a limited volume for testing purposes;
  • To check and validate how effectively the innovative solution works in practice;
  • Purchasing or procuring an innovative solution available on the market.

Entry is possible at any stage, depending on the market supply and the demand(s) from the contracting authority/principal or purchaser.

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