{"pageinfo":[{"Stamp":"pgo_4fa75f9cb7f77","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":0,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"Procurement, Stakeholders and WBS","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"Procurement is purchase of services or supplies by the buyer from the supplier(service provider, sellers,vendors, contractors) who are contracted after buyer engages a contract with the supplier upon buyer conducting thorough planning and selection of sellers. Procurement in a project can happen anywhere during project life cycle. Generally identified procurement items are listed in project scope work breakdown structure (WBS). Those work components having procurement items will enlist specific procurement statement of work (PSOW). PSOW sets purchase expectations from the buyer to the supplier or seller.<\/font>"}],"Subject":{"Related":"Buyer, Seller, Procurement statement of work, WBS"}},"Footer":{"PageNo":0,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4fa75f9cb80ef","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":1,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"Procurement Documents","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"It becomes essential for the buyer to plan on process of procurement (e.g. related documents, an unbiased evaluation system, selection criteria, single sourcing, preferred list, etc.). Some procurements are quantity based and some are larger and complex or service based. In most cases quantity based procurement will have specifications with mandated or optional warranty or maintenance clause. Procurement documents include IFB, RFQ, and RFP for any purchase may detail PSOW, selection criteria, buyer side contact information, pre-bid qualification, pre-bid clarification , schedules , contract type, terms & conditions, glossary, bonds (ideminity, performance, bid or others) required for bid qualification, proposal submission procedure.<\/font>"}],"Subject":{"Related":"Simple procurement, Large procurement with least cost estimate, Large\/Complex procurement with difficult cost estimate"}},"Footer":{"PageNo":1,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4fa75f9cb8244","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":2,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"Teaming and selection decision","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"The buyer if not knowledgable on the procurement technicalities may have teaming agreement with specialised consultant to do the job on their behalf with decision and approval authority clearly defined. The seller may not see such consultant as external entity but just a buyer. The buyer can have decision matrix for selection of vendors e.g. Criteria-Options-Weights-Scores(COWS), Scores = rating x weights. The rating are generally done on ratio-scale (1-10).<\/font>"}],"Subject":{"Related":"Teaming agreements, Selection criteria, Weights system"}},"Footer":{"PageNo":2,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4fa75f9cb83fa","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":3,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"Contract Types","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"Purchase order is a simplest form of a contract and contract types are decided during planning by the buyer or sometimes negotiated with seller for complex projects. Contract types for each procurement needs to be planned. Universally there are three types of contract which are Cost-Reimburasable(CR) or Cost-Plus(CP) , Fixed-Price or Lumpsum(FP), Time and Material (T & M). Extensions such as Award Fee, Fixed Fee, Economic Price Adjustmnet Factor(EPAF) may be considered. In CP, scope is abstract, buyer is at risks since any claim on legitimate bills buyer has to provide reimbursement. However in FP, scope is detailed, seller is at risks as any material price increase or econonmic fluctations can disfavor seller and ability to perform project activity within fixed price. To balance the risks the extension can be applied. A hybrid of CP and FP is T and M both share common space of risks sharing. T amd M contracts, unlike other type, require an extremely close working relationship with excellent communication of goals and status between the parties. One such example is agreement to predetermine unit rates during engagement of contract. Controls can be placed to check on efficient use of resource\/material.<\/font>"}],"Subject":{"Related":"CP, FFP, T&M"}},"Footer":{"PageNo":3,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4fa75f9cb85d3","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":4,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"Proposals and Bids","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"The tenders are advertised or published in newsprints or in websites (in case of e-procurement) for prospective seller to respond to same. The proposal related documents could RFP or RFQ or IFB(Invitation for bids). Pre qualification bids, bid bonds may be of a choice by the buyer (as advised by PMO) to encourage serious bidders. Bidders participate and respond by submitting the filled proposal and buyer make a note of responsiveness quality. IFB Sealed bids are typically used to procure high-cost items with easily definable characteristics looking for the lowest price (L1). All sealed bids are opened at an appointed time, reads them aloud and records them. Interested parties can view all the bids at this time, although they don't have access to the bidders' financial data and other proprietary information. RFP is more than price(L1) and similar to IFB in terms of larger procurments but more detailed in bids. Depending on the size and complexity of the purchase, negotiations may include discussion of price, schedule, technical requirements, and the type of contract to be used. Debriefing session may be conducted based on PMO advise on procurement process.<\/font>"}],"Subject":{"Related":"Simple procurement, Large procurement with least cost estimate, Large\/Complex procurement with difficult cost estimate"}},"Footer":{"PageNo":4,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4fa75f9cb87ca","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":5,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"Discussion, Negotiations, Inspection","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"In case of complex procurement , the buyer upon studying the proposal may shortlist those deemed as prospective sellers and may encourage in briefing or discussion and negotiations on either side. Buyer briefs the seller about problem background \/ summary and expects the eller to suggest the means of achieving it while seller explains how the proposal solve buyer problem. In double-envelop system technical proposal and commercial proposal are evaluated separately. Negotiation with the seller may take place. Further Shortlisted sellers may be invited to submit revised offers, taking into account the concerns raised during negotiations. To balance risks between parties, contract are negotiated to have a win-win scenario. Before awarding the contract the most likely seller may have buyer inspection on facilities, quality assurance process, financial status. A contract is then awarded to the seller which is mutually accepted and legal bound along with contract management plan. Debriefing session may be conducted based on PMO advise on procurement process.<\/font>"}],"Subject":{"Related":"Buyer seller relation and goal settings"}},"Footer":{"PageNo":5,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4fa75f9cb89c5","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":6,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"WIP time inspection and controls","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"For a seller, contract may mean as a project, and may follow project management standards as agreed by the buyer. The buyer as per the contract may inspect on work-in-progress procurement deliverables periodically and evaluate related performance of the seller. Accordingly if performance control are demanded it is applied on the seller. Corrective actions, Site visits, deliverable testing, process audits, penalities etc are examples of controls measures. Earned value management helps buyer to analyse variance, performance index and forecasts on budgets or any possible delays. Contract, Scope, Cost, Schedule change control system are mostly used because of risks attached with contract and procurement. Any disputes and claims arising should be settled between parties in amicable way. Most parties settle with arbitrators (common agency or alternate dispute resolution agency) to resolve the dispute and claims after evaluating on litigation options.<\/font><\/font>"}],"Subject":{"Related":"Procurement administration, deliverable inspection, change control system, disputes and claims, contract management"}},"Footer":{"PageNo":6,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4fa75f9cb9b20","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":7,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"End Procurement","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"Procurement are closed when contract become null and void between parties who earlier entered into contractual relationship. Buyer conducts delivery scope verification and validation before signing off the contractor. Any outstanding disputes and claims are settled, procurement audits are performed, lessons learned, payments to seller for procurement handover as per contract payment terms and follow any other administrative closure procedure as advised to close the procurement. In some cases contracts are terminated due to violation or breach of agreements and the effected party may issue a memo and any continued inaction to rectify will further worsen the situation to initiate a legal notice by the effected party seeking explanation for not to be terminated or without seeking explanation directly terminating the engagement as per contract terms agreed upon.<\/font>"}],"Subject":{"Related":"Procurement audits, verification and validation reports, payment, close claims, maintenance contracts "}},"Footer":{"PageNo":7,"Title":{"TitleText":"Footer-Title1"}}},{"Stamp":"pgo_4faf33afd9ab9","Topic":"Procurement Management","PageTo":"0","PageMark":"2","Header":{"PageNo":8,"Title":{"TitleText":"Procurement Management"}},"Sections":{"Title":{"TitleText":"PMBOK coverage","TitleAuthor":"K Srikanth, PMP"},"Matter":[{"Para":"Planning: Plan procurement

Executing: Conduct procurement

Monitoring & control: Administer procurement

Closing: Close procurement<\/font>"}],"Subject":{"Related":"PMBOK coverage "}},"Footer":{"PageNo":8,"Title":{"TitleText":"Footer-Title1"}}}]}