The Fruit of The Poisonous NIGP Code Tree by Jon Hansen

Posted on April 1, 2015


The National Institute of Governmental Purchasing, Inc. is a national, membership-based non-profit organization providing support to professionals in the public sector purchasing profession. – Wikipedia

This past November, I had an opportunity to meet and talk with the NIGP’s Chief Executive Rick Grimm.  As a panelist in a discussion that I was moderating, I found him to be both personable and quite knowledgeable.  In other words, I came away from the meeting feeling glad that I had made the connection, as well as looking forward to our next opportunity to talk.

I must admit that I would have never thought in a million years that the next opportunity would find us on opposite sides of a critically important, yet contentious issue.

While I will direct you to read my exchange of comments with the NIGP Chief Executive in my previous post titled Missouri Award Protest: The Gettysburg of Public Sector eProcurement, I will share with you the following concluding excerpt from what I can only describe as being a somewhat unsettling discussion:

Rick, and no disrespect intended – you have avoided answering the questions for which the answers should be fairly straight forward and forthcoming without reservation.

In an earlier comment in this discussion stream you wrote (and I quote); “The NIGP Code is available via equal access and support to all licensees across the board – including the same ability to utilize the NIGP Code on an equal cost basis. All licensees have the same contractual rights with regard to the NIGP Code. If you have proof to suggest otherwise, I will address it. Otherwise, I am hopeful that fair reporting will result.”

When I pointed out that the basis per CONTENTION #2 for the Periscope protest of the contract being awarded to Perfect Commerce appears to contradict your assertion i.e.

1. “Perfect Commerce’s Sublicense Agreement does not give them the right to provide such services. In fact, their Sublicense Agreement expressly prohibits the creation of “derivative works” by Perfect Commerce. Additionally, Perfect Commerce indicates in their response an ability to build crosswalks and provide access to all crosswalks provided by Periscope. Perfect Commerce’s Sublicense Agreement does not give them the right to provide such services or intellectual property” and,

2. The above appears to be clear in suggesting that Perfect Commerce does not have the ability “to provide access to all crossroads provided by Periscope.”

I asked three reasonable questions:

1. So what is it exactly that Periscope can provide that Perfect Commerce cannot?

2. Also, and given the ubiquitous importance of the NIGP Code, and the apparent need to convert to a current version of said Code, who does have the right to perform this necessary service? Does Periscope? Who else?

3. In terms of the Sublicensing Agreement related to this as well as other rights, are they equally available to everyone. For example, could Perfect Commerce upgrade their license to perform the required service?

Your response to these questions is to lawyer up?

This speaks volumes, and demonstrates a lack of transparency that should not happen with what is an important universal coding system in which access in terms of licensing, support and utilization should be an open book. Your response – or lack thereof – is precisely why the NIGP Code should be administered through an unbiased third party. Periscope is not an unbiased third party for the obvious reasons that I had previously stated.

Based upon the above, and your unwillingness to answer the three simple and straight forward questions, one might be inclined to believe that any and all bids past, present or future in which Periscope has been involved should be subject to review. In those instances where the company was awarded the contracts, said awards might even be challenged by participating vendors given the fact that it does not appear that the licensing practices for the Code are both consistent and equitable.

I am really sorry Rick, but there is something seriously amiss. Similar to when baseball had to seek it’s first commissioner following the 1919 Black Sox scandal, I fear that when it comes to the guardianship of the NIGP Code the procurement world desperately needs its version of a Kenesaw Mountain Landis.

Since I began covering this story in earnest earlier this week, I have started to receive calls and messages that suggest that I am not alone in my thinking regarding obvious conflicts of interest pertaining to the guardianship of the NIGP Code.

Given its importance, it is now becoming increasingly clear that neither Periscope, or for that matter even the NIGP, should be overseeing its licensing.

The lack of transparency and seeming double speak followed by lawyering up when asked three simple and straightforward questions, warrants that a possible change in stewardship be seriously considered.

The real question is what’s next?

Based on new information, it now appears that Perfect Commerce – NIGP’s questionable licensing practices notwithstanding – are not the only ones in violation of the conversion/crosswalk restriction.  It is further being suggested that NIGP is fully aware of these breaches, but has failed to take action because in some instances, they originate on the end-user side of the table.

Even if they are not aware of it, to take action in similar fashion to what is being done to Perfect Commerce, would mean that the NIGP would have to go against the very members and procurement community it is supposed to be supporting.

As I continue to investigate these emerging elements of what is becoming a very interesting story (to say the least) I will, as always, keep you informed.

In the meantime, if I were a vendor involved in a bid to implement an eProcurement system that was awarded to Periscope – or any company affiliated with that organization – I would consider possibly challenging said award.  The basis for such a challenge is fairly obvious.

If I were a government entity and had awarded a contract to Periscope, I would start lining up my ducks now to defend my decision in light of these revelations.  As is often the case with stories such as these, it only takes a spark to start a raging inferno, and I think that we now have our spark.

poisonous tree2


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