The NSW Government recognises that the marketplace is a great source of innovation that can assist government to work smarter and deliver better services. Innovation can be sought and encouraged at three levels of market engagement:

at the State economic level - through effective, early, structured, and open communication of needs to the market to encourage appropriate research and development, and attract the right suppliers for the government customer base

at the sourcing level - there are multiple types of market engagements, some of which have been described in this document

at the contract management level - by incorporating performance-based measurements, such as KPIs, that promote innovation.

Providing a signal to the market of the future high-level needs and priorities of government procurement encourages outcomes-based and innovative procurement.

Innovative procurement proof-of-concept testing for short term contracts up to $250,000 from SMEs is outlined in Board Direction 2014-05.