Why use a challenge statement
A challenge statement frames the procurement in terms of a problem or outcome. It allows suppliers to think creatively about different ways to solve a problem, and put forward proposals that might not be expected.
Attract innovation with a challenge statement
Defining the scope of innovation involves spending time in the problem space to pinpoint the problem you are trying to solve or the outcome you are trying to achieve. Problems and outcomes are solution-agnostic, meaning there could be multiple ways to achieve your goals.
A well-framed challenge statement will signal the full extent of the opportunity to the market, define measures of success, and provide a clear lens to align everyone involved in the buying process to deliver successful outcomes.
Buyers of innovation should be open to new or unknown ways of solving a problem. The rapid pace of change in technology means buying teams won’t always know the latest developments. Making assumptions about solutions before approaching the market can result in significant disadvantages and risks.
Buyers can explore innovation scope through one or more workshops. The final output is a challenge statement that the market can respond to.
A challenge statement may still need to articulate minimum technical requirements or constraints. Buyers should avoid relying too heavily on technical specifications or detailed requirements that can lock good solutions out.
Resources
Learn more about the risk of assuming a solution.
When to scope for innovation
Innovation scoping should happen once a core buying team has mobilised. This ensures the right expertise can contribute to the scope. After this step, teams will often find they need to tweak their procurement approach from Pathway triage as a result of better understanding the problem or desired outcome - this is normal and encouraged.
- after an initial discovery
- during or after Mobilise stage
- before finalising the Statement of Requirements (SoR) and Procurement Strategy documents
- before suppliers have been engaged, to ensure probity provisions and risks have been considered.
Outputs can be used to define:
- evaluation criteria
- evaluation plan
- challenge statement in the Statement of Requirements (SoR) document
- tender requirements
- supplier-friendly guidelines
- supplier briefings.
Who to involve and their responsibility
Since the scope of the innovation focuses on the problem or desired outcomes for a business area or service, the buyer is the primary driver of this activity. However, the buyer can rarely complete this step alone - involvement of other subject-matter experts is essential for understanding a problem space. Expand the headings below to read more about the responsibilities of different roles.
Buyers should drive innovation scoping due to their proximity to the desired business outcomes. They should ensure they engage key people at each step of the process.
Even when the end solution or range of solutions is unknown, the core buying team may need to include key subject-matter experts (SMEs). They can help uncover and shape the problem to be solved and define one or more challenge statements that the market can understand and respond to.
They can help uncover and shape the problem to be solved and define one or more challenge statements that the market can understand and respond to.
Resources
Learn more about the types of SMEs, and how they contribute to the success of the buying project.
Procurement officers should be familiar with the key steps for innovation scoping and challenge statement definition. Understanding the business objectives will help them tailor the procurement approach to achieve them. Procurement specialists may be able to advise on whether the challenge statement provides the right level of detail for the market to respond to. They may also be able to identify other subject-matter experts that should contribute.
Resources
Learn more about the types of SMEs, and how they contribute to the success of the buying project.
Subject-matter experts (SMEs) have an important role in buying teams when the solution or range of solutions is unknown. SMEs help uncover new information, shape the problem to be solve, and contribute to the challenge statement.
NSW Government internal SMEs may include ICT, digital, risk, innovation and service design functions, as well as those who might have an interest in, or be affected by the procurement outcomes. Internal SMEs should be prepared to:
- attend and contribute to a problem shaping workshop
- review the outputs including the challenge statement, success criteria and any pre-determined solutions or technical requirements.
Design and facilitation of problem shaping workshops, problem framing, and challenge statement definition may be led by the buying team using self-service resources, or NSW Government internal service designers may be engaged.
Learn more about the types of SMEs, and how they contribute to the success of the buying project.
If discovery work has not already been undertaken, external SMEs may need to be engaged in additional problem shaping workshops. Groups involved may include peak bodies, industry associations, and the people who experience the problems.
Internal service designers and those with similar skills can be engaged to lead additional problem shaping workshops with external SMEs. This may include engagement design for larger groups of external stakeholders, workshop facilitation, insights synthesis and problem definition.
Resources
Digital NSW supports buying projects with innovation specialists or Service Designers to run a discovery activity that integrates with the innovation procurement methodology. Contact the innovation procurement advisory team to find out more.
Scoping for innovation next steps
Scope for innovation resources
From problem space to framing the challenge.
Uncover problem and frame desired outcome.
Write a challenge for the market to solve.
Learn the risks of assuming solutions.