Towards a greater great – research opportunities to improve cross-fertilization between public and industry procurement

The differences between public and industry procurement provide cross-learning opportunities for both domains of procurement practice (Stentoft Arlbjørn and Vagn Freytag, 2012). In well-known strategies such as supplier collaboration and sourcing strategy development procurement, public procurement organizations were said to have some room for growth (Hawkins et al., 2011). The COVID-19 pandemic, however, brought several critical aspects, roles and capabilities of public procurement to the forefront that led the way for industry. This included public procurement’s role in ensuring critical supplies such as PPE and testing kits, its role in enabling lifesaving vaccine innovation in industry, by funding research and committing to orders upfront and its role in navigating disaster response through the buying of thousands of ventilators produced in industry (van Hoek and Loseby, 2021). While this illustrates that, perhaps counter to common expectations, public procurement is not necessarily less mature or less of a source of potential best practice than industry procurement is. On the flip side, we also experienced extreme criticism of public procurement during the pandemic. From EU governments not being able to secure vaccines as fast as the US and the UK could. To the need for hospitals to turn patients away because of a scarcity in beds and supplies. It is not uncommon for public procurement to be criticized for failure, as well as, credited as being a key social political lever (Flynn and Harris, 2022). This paper aims to make the case that public procurement has given the procurement profession key capability enhancements that are relevant for buyers in industry also. In addition, there are also areas where public procurement can learn from procurement in industry and areas where the two domains can learn together. We review both and suggest research questions that may support the bridging of gaps, for the good of public and industry procurement.Cross-learning opportunities between have been identified by Roodhooft and Van den Abbeele (2006) and Lian and Laing (2004) at a specific category level (consulting services and medical services, respectively), the functional level (Stentoft Arlbjørn and Vagn Freytag, 2012) and at the level of a particular capability (ethics) (Hawkins et al., 2011). However, there have been a shortage of comparative studies across both domains (Etse et al., 2021). And while these studies identified the cross-learning opportunity in general, they did not distinguish between the three learning scenarios on the left of Figure 1; what are the topics on which public procurement professionals can learn from their industry peers, and how? What are the topics on which industry procurement professionals can learn from public procurement and what are joint learning opportunities? In addition, what are methods and approaches for learning about these cross-fertilization opportunities?Based upon several work sessions with public procurement professionals and extensive author industry experience a simple framework was developed, Figure 1, to (1) capture areas where public procurement can provide lessons to enhance industry capability, (2) areas where industry procurement can provide lessons for public procurement and (3) areas where public and industry procurement both can learn more and develop capability. Across these three areas, research could support the learning process if targeting specific research questions across the three areas.Due to its regulated nature, public procurement has historically excelled at creating transparency throughout the sourcing process. Public procurement organizations typically publish supplier selection and award criteria, the sourcing process steps and timelines. Whereas it is well understood in industry that visibility into the process and award criteria supports suppliers in a way that can lead to better offers and greater supplier engagement, industry procurement organizations are not typically as consistent in creating transparency. For example, while an industry tender document will typically include a decision matrix and a timeline, far from all spend is sourced via a tender.Because of political influence, financial interest, complicated procedures and corruption, public procurement is a high-risk sector (Paraskeva and Tsoulfas, 2025). With the strict adherence to established process and the assurance of public visibility, public procurement is set up well for reduced levels in reputational risks when compared to industry procurement. Reputational risk, the risk of negative reputational consequences procurement practice, has been studied less in exant literature than other types of risks (Schoenherr et al., 2023). Whereas industry procurement will operate with a policy and a process, in reality compliance with the policy and adoption of the process can be partial (Mena et al., 2025). In addition, for competitive reasons companies will tend to not publish their full procedures and policies publicly. This introduces the risk of reputational damage, including from potentially nonethical sourcing practices. With policy less transparent and compliance partial, the risk is that intended or unintended roque buying practices can drive ethical sourcing and reputational risks. In public procurement, compliance with detailed and comprehensive buying practices and transparency of buying far reduce these risks.Sourcing for societal value closely aligns with the purpose of public procurement but can be more aspirational in industry procurement. Whereas ESG target setting incorporates social values into industry procurement, the reality is that this is a focus of growing importance that comes in addition to traditional business-centric focus. Discussions about greenwashing, misalignment between goals and investment (Skipworth et al., 2025) and the need for greater embedding of ESG policy in the organization (van Hoek and Udesen, 2024) provide illustration of how social value may be more optional and partial in industry procurement focus than is possible in public procurement.McCue et al. (2015) pointed out several unique challenges when compared to the industry procurement organizations. Public procurement organizations are being challenged to develop new flexible structures and processes while maintain accountability and control, increase economic efficiency while satisfying political demands and applying best practices while confronting legal limitations. Evald and Freytag (2007, p. 31) found that the unique and political context of public procurement can reduce a focus on innovation over compliance:The focus on rigorous compliance with procurement policy and regulation also reduces agility in public procurement. Agility, or the ability to be quickly responsive to changing market circumstances (van Hoek et al., 2001), requires the ability to reconfigure product, process and services in response to (individual) customer needs, in limited timeframes. While agility is not needed everywhere and to great degrees, in all markets companies the modern-day dynamics of industry supply chains call for consistent levels of responsiveness and agility. The rigor around process compliance in a regulated public procurement process can reduce the ability to be agile. Public procurement organizations face organizational barriers (e.g. bureaucratic structures, risk aversion), contextual barriers (e.g. political influence) and stakeholder complexity (Molitoris et al., 2025). Mandatory publication periods of tender documents and award intentions for example, are nonnegotiable time commitments that reduce response times.As a result, resiliency in the face of supply chain disruption can be harder to achieve for public procurement organizations. Levels of emergency response can be planned, strategic reserves and building dedicated emergency response teams and resources such as at FEMA being a textbook example. For unplanned disruptions emergency orders, such as for the development of a COVID vaccine, can help but these can also come at a cost. In industry levels of resiliency to unexpected and potential disruptions is achieved even by companies in low margin using techniques such as warrooms, short term inventory buffering and leaning on longer-term supplier collaboration outside of sourcing processes.These supplier collaborations can also lead to supplier contributions to innovation (van Hoek et al., 2020). The role of public procurement in stimulating innovation has been recognized and several organizational approaches have been suggested (Hommen and Rolfstam, 2008). But these forms miss several approaches used in industry. While not a standard practice in industry yet, there has been a consistent focus, at least the last five years on developing supplier enabled innovation capability (Di Mauro et al., 2024). Through a focus on ongoing supplier relationship management with critical suppliers, procurement organizations have been able to achieve levels of relationship commitment that include the willingness of suppliers to (co-)invest in product/process/service innovation for their customer. These investments can be exploratory, involve joint development or focused on enhancing product features. All of these innovation results would be beyond and outside of the original sourcing process, scope and specifications used in the tender to originally qualify and select the suppliers. Open sourcing or sharktank like events are alternative mechanisms that can be used for attracting supplier innovation contributions. Public procurement often lacks sufficient opportunities for suppliers to propose innovative solutions (Patrucco et al., 2025). These types of engagement can not be achieved in existing public procurement frameworks and generally public procurement organizations have a smaller focus on relationship management over compliance with procurement policy.While public procurement organizations major in buying for social value as part of its raison d’etre, efforts around environmental sustainability can be more prominent in industry. Industry drivers for sustainable supply chain include consumers and investors (CSCMP, 2024) and these are obviously less prominent stakeholders in public procurement. It is more common for companies to have carbon emission reduction targets and programs. The CDP, a not-for-profit carbon disclose organization, for example, reports on its public website that only 573 cities, states and regions have a sustainability adaptation plan, only 300 cities, states and regions have a 1.5C emission reduction target and only 254 cities, states and regions have a renewable energy target.For public procurement organizations, a pathway toward flexibility and greater agility will require continued process rigor and adherence to standards and rules. Equally so in industry, agility cannot come at the complete expense of process integrity, and compliance with regulation and customer service standards and processes contractually agreed to. The resulting balancing act represents an opportunity to mix rigor with responsiveness. Concepts like postponement and mass customization are used in manufacturing and logistics to delay customization to retain responsiveness to specific customer needs while maintaining volume and inventory efficiency prior to the moment of customization. In procurement, similar approaches could entail placing volume orders but delaying the shipping request until actually needs have crystallized. Or contracting spare capacity using the proper contracting process without allocating in until needed and exploring additional products and services already contracted supplier can provide, within the contract in place, based upon just a purchase order are others.Public procurement and industry procurement organizations alike reduce compliance risks actively to avoid delayed or legally challenged orders in public procurement, to avoid fines and reputational risks in industry. Ongoing risks of supply chain disruptions require procurement organizations to continue to target risk efforts that extend far beyond compliance risks. The challenge with this is that most structural resiliency approaches (such as reshoring, supplier diversification and achieving better visibility through IT integration across multiple supply tiers) take time to implement (van Hoek, 2021), can increase costs and require change discipline. Post pandemic, there is lots of work left to enact resiliency plans and there is a real risk of organizations going back to business as usual. Considering top risks as reported by Allianz in its 2025 global risk report public and industry procurement supply lines are equally disrupted by top risk factors such as logistical bottlenecks, geopolitical issues and cyber security risks.Supplier collaboration is one of the most powerful enablers of resiliency and innovation. The regulatory and process framework for public procurement organizations often does not go far beyond the conclusion of sourcing and contracting and while SLA’s may be included in contracts public procurement, professionals often do not actively engage in supplier relationship management (SRM) efforts. The industry focus on collaboration and trust as an alternative to ensuring best price marks a difference between public and private procurement, tendering requirement and policy can get in the way of collaborating (Stentoft Arlbjørn and Vagn Freytag, 2012). Operating under rules that limit close supplier relationships implies that the integrated supply chain management benefits may not be as achievable in public procurement as in industry procurement (Hawkins et al., 2011). The reality, however, is that while there are widely shared aspirations to grow SRM and supplier innovation capability in industry procurement, the reality is that there is much room for growing supplier collaboration in industry procurement (Mena et al., 2025), making it a joint learning opportunity.As discussed, social sustainability aspect is central to public procurement efforts, equally so avoiding reputational and regulatory risks around social sustainability and responsible sourcing aspects (such as force labor, labor standards and use of conflict minerals) are common in industry. Environmental sustainability is often less focused on in public procurement and the focus on social sustainability can be compliance centric. In industry procurement there is plenty of room for progress in environmental sustainability and more wholehearted engagement in social sustainability and environmental sustainability (van Hoek et al., 2024).The far-right side of Figure 1 suggests research questions against the cross-fertilization opportunities identified. To study these questions, methods to do so need to be considered. In this question resides an opportunity for innovation; how to study cross-fertilization opportunities across distinctly different procurement domains? Obviously, comparative studies and multiple case studies can be used. But beyond that, there may also be opportunities to replicate designs from one domain into the other and evaluate design effectiveness and appropriateness as well as the need to fine tune or alter designs. Including a feedback loop back to the original operating environment in which the design was used could spark additional perspective.In addition, there may be opportunities to engage procurement professionals in developing perspective on fertilization opportunities by exposing them across fields. This could be done through workshops that bring public and industry procurement professionals together and site visits. If focused on a topic where one domain can learn from the other both can benefit through reflection upon practice and opportunity and calibration of perspectives. If focused on a joint learning opportunity the different starting points of public and industry procurement professionals can enrich consideration, perspective and lead to more robust and exportable insights.Public and industry procurement organizations face different and similar opportunities to learn and mature. Whereas public procurement may face a limited ability to achieve industry best practice, it also offers capabilities that can enhance industry capability. The good news is the two domains can learn from each other and with each other.