Smart Procurement in ITS: From Products to Outcome-Based Mobility Solutions
The way cities procure Intelligent Transport Systems (ITS) is undergoing a fundamental shift. What was once a process focused on hardware, detailed specifications, and compliance is evolving into smart procurement: a strategic approach that enables innovation, flexibility, and measurable outcomes for the key mobility problems to be solved.
This shift is not optional. Modern mobility systems are no longer static infrastructure. They are digital, interconnected, and continuously evolving. As a result, traditional procurement models are increasingly unable to keep pace with the complexity of today’s mobility challenges.
From Product-Based to Outcome-Based Procurement
Outcome-based procurement creates a fundamental shift in responsibility. Success is no longer measured by the delivery of equipment, but by performance against clearly defined KPIs. This aligns incentives between public authorities and suppliers and enables continuous improvement over time.
Traditional procurement frameworks were designed for stable, predictable systems. In contrast, modern ITS solutions rely on software, data, and continuous updates. So called innovation procurement enables cities to adopt these solutions by allowing greater flexibility in how requirements are defined and how solutions evolve.
This includes:
- creating room for new technologies such as AI, V2X, and digital twins
- enabling iterative improvements instead of fixed, one-time deployments
- establishing procurement frameworks that encourage innovation while maintaining fairness and transparency
Innovation procurement is therefore not only about buying new technology. It is about enabling new ways of solving problems.
With these developments, procurement is becoming more than a transactional function. It is evolving into a strategic capability that shapes entire mobility systems.
In practice, procurement decisions define:
- system architecture and interoperability
- the ability to integrate multiple data sources
- the flexibility to scale and evolve solutions over time
To support this role, procurement should increase their strategic thinking, impact orientation and a and problem-solving skills: Focusing on what systems need to achieve in the future, rather than how they are technically built.
None of these approaches can succeed without trust
Trust, Transparency, and Shared Outcomes
Smart outcome-based procurement all depend on trustfull collaboration between public authorities and suppliers.
This includes:
- jointly aligned and measurable KPIs
- shared goals and aligned incentives
- open access to data and performance insights
Trust enables openness. And openness enables better solutions.
Without this foundation, procurement remains transactional and limits innovation.
Many procurement systems still follow traditional models
Overcoming Structural Barriers
Challenges include:
- budget structures focused on capital expenditure
- limited flexibility for recurring costs (e.g. SaaS)
- rigid specifications that limit innovation
To address this, procurement must evolve toward capability building.
Capability building in detail:
- aligning financial models with long-term value creation
- adopting outcome-based evaluation criteria
- enabling more flexible contract structures
From Single Vendors to Ecosystems
One of the most important implications of smart procurement is the shift from single vendors to ecosystems of partners.
Mobility challenges are complex and interconnected. Improving a bus corridor, for example, is not only about adding vehicles. It may involve:
- traffic signal prioritization
- V2X communication
- corridor optimization
These solutions require expertise from multiple domains.
Smart procurement must therefore remain open and flexible. In some cases, one provider may deliver an integrated solution. In others, multiple partners need to collaborate. Avoiding vendor lock-in and enabling interoperability becomes critical.
Conclusion: Smart Outcome-Based Procurement enables Better Mobility
The transition toward outcome-based procurement is not just a procedural change. It is a fundamental enabler of innovation in mobility.
By applying smart outcome-based procurement, cities can move beyond purchasing individual components and instead secure solutions that deliver measurable impact.
This approach allows mobility systems to:
- adapt to changing conditions
- integrate quickly evolving new technologies
- and continuously improve over time
The future of mobility will not be defined by the products we buy.
It will be defined by the outcomes we achieve.
Procurement has an important role to play.
