Lecture on

Partly adapted from Video Lessons of Trudy Robinson

(source:BSBPmG408A,www.trudyrobinson.com) (misilamani@yahoo.com))

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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Its all a load of Balls!

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Procurement Indices
Attainment Fulfillment Contract Appropriation Securing Providing Tender
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Gaining Acquisition Vendor Buying Purchasing Furnishing Supplier

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Public Procurement

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Procurement

Project Activities

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Procurement
INPUTS To
PROJECT

OUTPUTS to PROJECT

PROCUREMENT CONTROL

(supply, deliver & purchase)

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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)

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Project Procurement Management

Contract Management
Process, DIFOT(Delivery In Forlorn Time) Payments

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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 Procurement Process 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 suppliers 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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Boeings 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
DIFOT Performance

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 & decide Know your contracts and the clients of each DIFOT FORMAL PROCESS-stick to it
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procurement cycle

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