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Partly adapted from Video Lessons ofTrudy Robinson
(source:BSBPmG408A,www.trudyrobinson.com)([email protected]))
PROJECT PROCUREMENT
Lecture on
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PROJECT PURCHASING
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Objectives
• To understand and apply knowledge regarding, Purchasing Contract Project Inputs & Outputs
Which need to be managed by a formal procurement process(PMBOK V4 reference-pg 313, Chapter 12)
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It’s all a load of Balls!
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Procurement Indices
AttainmentFulfillmentContractAppropriationSecuringProvidingTender
GainingAcquisitionVendorBuyingPurchasingFurnishingSupplier
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Public Procurement
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Procurement
INPUTS TO PROJECT
OUTPUTS FROM PROJECT
Project Activities
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Procurement
(supply, deliver & purchase)
OUTPUTS to
PROJECT
INPUTS To
PROJECT
PROCUREMENTCONTROL
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RESPONDING
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Project Procurement Management
Identifying what you Need to Buy In
Clear requirements
Who you are going to work with(supplier)
INCOMING
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Project Procurement Management
Contract Management
Process, DIFOT(Delivery In Forlorn Time)
Payments
OUTGOING
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PROJECT PROCUREMENT PRACTICE
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Project Procurement Management
PROCESS Identify procurement
requirements(Concept) Plan procurement(Design) Conduct & Administer(Implementation) Close procurements(Finalization)
(Referrence: PMBOK pg 317)
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Project Procurement Management
• CONTRACTS Agreements Purchase order Memorandum of Understanding(MOU) Sub- contract Service level agreements
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Project Procurement Management
CONTRACTS-cont Terms & Conditions Clear points of payment Specific product/service provisions Schedule Exclusions Model-Time & Material
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TROUBLE SHOOTING
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Project Procurement Management
WIDER PICTURE Organizational policies• Who decides?
Quality/OHS• Occupational safety & health
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Project Procurement Management
WIDER PICTURE-cont Other projects Legal counsel Existing commitments
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Procurement ProcessProcurement Process
PROCUREMENT PROCESS
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Project Procurement Management
YOU Will CREATE Procurement management plan Procurement statement of work(SOW)-
similar to a PD but for the contract; not the individual
Invitation To Tender(ITT) Request for Information(RFI), request for
Proposal(RFP) etc.
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Project Procurement Management
SELECTION CRITERIA Clear outline of requirement Ensure all responses received are in
identified format Think ahead- word the ITT to enable
numerical value to be applied to a supplier’s response(simplifies overall analysis)
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PROJECT CONTRACTING
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Project Procurement Management
• SELECTION CRITERIA-cont.• No duplications or ambiguity in
requirements• Provide one point of contact where
questions can be asked• Evaluate, compare, choose
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Boeing’s Procurement Process
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Project Procurement Management
MANAGE DIFOT Performance Adherence of contract Payment approvals Change requests/variations
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Project Procurement Management
• CLOSE Final review
DIFOTPerformance
Final payments
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Project Procurement Management
CLOSE• Input to lessons learned• resources management
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PROJECT CLOSING
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Summary
Procurement is managing contracts, inputs to the project as well as outputs
Influences outside the project will influence (organizational policies..)
Identify, Clarify, Invite, evaluate & decideKnow your contracts and the clients of eachDIFOT ‘FORMAL PROCESS’-stick to it
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procurement cycle
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Thank You