Enhancing localisation in public procurements: A framework for evaluating suppliers' capabilities

Abstract

This study investigates a framework for assessing suppliers' capabilities in public procurements to bolster localisation objectives. The study utilises the Action Design Research (ADR) methodology, combining the strengths of Action Research and Design Science, to examine the 'Ten Products Group' initiative within Iran's oil industry (2014–2023). This approach allows for the investigation of an applied problem within its specific contextual framework. The research highlights the importance of a comprehensive capability evaluation framework that includes qualitative assessments of suppliers' organisational, technological, and manufacturing capabilities. The framework incorporates both self-reporting and independent outside evaluation, enabling the inclusion of competent participants in public procurements and aligning contractual duties with the objective of localisation.

The study emphasises the need for a transparent and thorough capability evaluation framework, contributing to the development of local industries and economic growth in situations where suppliers lack necessary capabilities. It suggests that a well-designed capability evaluation framework can facilitate the growth of local industries through public procurements, enabling the inclusion of competent suppliers and supporting economic development. The study's limitations include its focus on the context of localisation in public procurement and the potential challenges associated with implementing the proposed capability evaluation framework in practice.