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Project Procurement Management

19 Nov

Procurement is used in project management to acquire goods and/or services from outside sources for several different reasons in a project, such as:

  1. Reducing both fixed and recurrent costs
  2. Extra help during peak performance periods
  3. Access to specific skills and technologies
  4. Allow your organization to focus on their core competencies

Problems with Outsourcing:

  • Less control over the aspects of projects that suppliers carry out
  • Organization becomes too dependent on certain suppliers, which leads to a high risk if they go out of business or lose key personnel
  • Security issues due to intellectual property, integrity of data and reliability of infrastructure of offshore locations

Procurement Process:

  • Plan: Determine what you want to procure (make-buy decision, contract to use, statement of work definition), when, and how (source selection criteria)
  • Execute: Research potential sellers, conduct interviews, award contracts.  Review: resource calendars, change request, project plan updates, and project documents
  • Monitor & Controlling: Administer procurement, managing relationships with sellers, performance evaluation, manage change requests and project plan updates
  • Closing: Close procurements, settlement of contract, resolution of open items, and asses procurement process “lessons learned”

Develop a Procurement Management Plan that includes:

  • Contract to be used
  • Procurement document/template
  • WBS & Statement of Work (SOW)
  • Roles & Responsibilities
  • Evaluation Matrix
  • Constraints & Assumptions
  • Process for coordinating procurement decisions & change requests
What tips do you have in regards to procuring outside resources?

 Project Management Plan Example

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One response to “Project Procurement Management

  1. prince2 methodology

    April 2, 2013 at 12:45 pm

    Hello! I’ve been reading your web site for some time now and finally got the courage to go ahead and give you a shout out from Humble Tx! Just wanted to say keep up the good work!

     

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