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Project
Procurement Management
Project
Procurement Management is a part of project management that includes
the processes required to acquire goods and services from outside
the performing organization. Project Procurement Management consists
of procurement planning, solicitation planning, solicitation, source
selection, contract administration, and contract closeout.
Project Procurement Management provides the processes to acquire
goods and services required for successful completion of the
project.
Project
Procurement Management is one of the nine knowledge areas defined by
the PMBOK®. Project Procurement Management provides the processes to
acquire goods and services required for successful completion of the
project. Project Procurement Management includes the processes
required to acquire goods and services (most often design and
construction services) from outside the owner’s organization for a
program, project, or a specific sub-project. Project Procurement
Management evaluates various project delivery approaches such as
traditional design-bid-build, construction management, multi-prime
and design/build to promote a contract strategy that can yield the
most successful project.
Project
Procurement Management is concerned with the processes for acquiring
goods and services from outside the performing organization. The
participation of external parties is common in projects.
Commensurate with the risk involved in performance, projects need to
coordinate and communicate requirements. These include legal
documents defining the relationship, duration, nature and extent of
work, terms, and conditions. The component processes of Project
Procurement Management are procurement planning, solicitation
planning, solicitation, source selection, contract administration,
and contract close out.
The Project
Procurement Management plan: The Project Procurement Management plan
defines the strategy for aligning the supply chain to meet project
needs and forms the basis for managing internal and external
suppliers. At a minimum, this plan should address the following
issues:
- What are the
key capabilities requirements for the project? Which capabilities
exist in the parent organization, and which will need to be
procured? Does the existing supply chain possess the required
capabilities, or will new suppliers need to be introduced?
- Who are the
potential suppliers and what relationships currently exist or will
need to be developed? What is the nature of existing supplier
relationships (e.g., long-term agreements, preferred suppliers,
etc.)? In the case of existing agreements, are there potential
remedies for not involving the supplier?
- How will
suppliers be evaluated and selected? What specific key performance
indicators will be used? How many sources are available? Which
procured items will be competitively bid, which ones will be
procured using existing supplier agreements or relationships, and
which must be sourced from a specific supplier?
- How will
communications with suppliers be managed and documented? How will
necessary technical meetings be facilitated between the supplier
and project team members?
- How will
supply chain performance be measured? Which performance measures
will apply? How often will progress be measured? What corrective
actions will be taken for variations?
- When and how
will supply management resources be managed and integrated into
the project team?
- What are the
supply chain risks and how will they be mitigated or managed?
The Project
Procurement Management plan should be developed at project
initiation and integrated into the overall project management plan.
This is particularly important for high-risk projects or projects
that have significant bought-out
elements.
Summary of the
Project Procurement Management (PPM) Template: In complex
procurement, project and procurement must be properly integrated in
order for clients and other stakeholders to achieve program, project
and procurement objectives. Complex procurement is characterized by
changing requirements, many stakeholders, an extensive solicitation
and source selection process, and the need for advanced contract
management disciplines.
The Project
Procurement Management Template describes the complex procurement
business process of the Supply Operations Service Branch (SOSB) of
PublicWorks and Government Services Canada (PWGSC). The Project
Procurement Management template is based on the experience of the
Aerospace Marine and Electronic Systems Sector (AMES) management of
Major Crown Projects (MCPs) over the last 20 years. Although the
Project Procurement Management template is focused on equipment
system acquisition and updates, it also addresses the principles of
Benefits Driven Procurement as applied to Information Technology and
System Integration projects.
The Project
Procurement Management template is intended as a guidance document
for procurement managers and the teams involved in complex
procurement. It describes our business process, assists us in
communicating with clients and industry, and it is an input to
training and process improvement initiatives. The Project
Procurement Management template provides a description of each of
the 49 processes in terms of its objective, process, and output.
There is also a description of the objectives; inputs and outputs
for each phase that links procurement, project, and program
objectives.
When
you, as a project manager, accept responsibility for a project, you
accept the schedule, timeline, deadlines, resources, and
expectations set out at the start. Now you can make sure you're
asking the right questions for each project by utilizing the tools,
checklists, and information from projectmanagementsurvival.
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standards. You'll have the details and plans in place to handle
whatever arises during a project's duration—setting appropriate
expectations for timelines, milestones, and deliverables. And,
ensure success for each and every project with resources on:
- Ensuring you
have the necessary equipment and resources available
- Properly
documenting all project activities
- Identifying staff skills by roles needed
- Putting
quality controls in place
- Identifying
and estimating indirect costs
- Documenting
and prioritizing requirements
- And much more
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