Essay: Procurement Management Plans

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INTRODUCTION:

The purpose of the Procurement Management Plan is to define the procurement requirements for the project and how it will be managed from developing procurement documentation through contract closure. The Procurement Management Plan defines the following:

‘ Items to be procured with good reason statements and timelines
‘ Type of contract to be used
‘ Risks linked with procurement management
‘ How procurement risks will be lessened through contract performance metrics, insurance, or other means
‘ Determining costs and if/how they’re used as valuation criteria
‘ Performance metrics for procurement activities
‘ Any standardized procurement templates or documents to be used
‘ How multiple suppliers will be managed if applicable
‘ Contract approval process
‘ Establishing contract deliverables and deadlines
‘ Any constraints related to procurement
‘ seller Management

This plan identifies and defines the items to be procured, the types of contracts to be used in support of this project.

PROCUREMENT MANAGEMENT APPROACH:

The Procurement Management Plan should be defined enough to clearly identify the necessary steps and responsibilities for procurement from the beginning to the end of a project. The project manager must ensure that the plan facilitates the successful completion of the project and does not become an overwhelming task in itself to manage. The project manager will work with the project team, contracts/purchasing department, and other key players to manage the procurement activities.

The Project Manager will provide control all procurement for the project.

The Project Manager will help the team of project to identify all items to be procured for the successful completion of the project.

PROCUREMENT DEFINITION:

The purpose of procurement definition is to describe, in specific terms, what items will be procured and under what conditions. Sometimes items which must be procured for a project can be made internally by an organization. Additionally, procurement deadlines are usually affected by the project schedule and are needed by certain times to ensure timely project completion. This section is where these items must be listed, justified, and the conditions must be set. Any important technical information should also be included.
PROCUREMENT RISK MANAGEMENT:
The purpose of this section is to describe how risks related specifically to procurement activities will be managed. All projects should have an independent and thorough risk management plan. However, much like there are risks which relate only to procurement, there are risk management search which may also be unique and apply only to procurement.

PROCUREMENT RISKS:
The purpose of this section is to identify any potential risks associated with procurement for the project. Depending on the contract type, items or services being purchased, seller history, or doubts in the project’s scope, schedule, or budget, possibility risks may request more detailed planning and reduction strategies.
COST DETERMINATION :
The purpose of this section is to describe how costs will be determined and if/how they will be used as part of the selection criteria. For procurements seeking goods and/or services from an outside seller, costs are usually provided in response to a Request for Quote (RFQ), Request for Proposal (RFP), or a Request for Bid (RFB). Vendors submit quotes, proposals, or bids which describe the costs of the good or service in detail to aid the customer in their decision making.

All information must be included in each proposal as the proposals will be used as the foundation of our selection criteria. Proposals which delete requested information or contain incomplete information will be discarded from consideration.

PROCUREMENT CONSTRAINTS :
The purpose of this section is to describe any constraints which must be considered as part of the project’s procurement management process. These constraints may be related to schedule, cost, and scope, resources, technology, or buyer/seller relationships.

There are several constraints that must be considered as part of the project’s procurement management plan. These constraints will be included in the RFP and communicated to all vendors in order to determine their ability to operate within these constraints. These constraints apply to several areas which include schedule, cost, scope, resources, and technology:
Scope:
All procurement activities and contract awards must support the approved project scope statement. Any procurement activities or contract awards which specify work which is not in direct support of the project’s scope statement will be considered out of scope and disapproved.

Schedule:
Project schedule is not flexible and the procurement activities, contract administration, and contract fulfillment must be completed within the established project schedule.
Cost:
Project budget has accident and management reserves built in; however, these reserves may not be applied to procurement activities. Reserves are only to be used in the event of an approved change in project scope or according to management discretion.

Technology:
Parts specifications have already been determined and will be included in the statement of work as part of the RFP. While proposals may include suggested alternative material or manufacturing processes, parts specifications must match those provided in the statement of work exactly.
Resources:
All procurement activities must be performed and managed with current personnel. No additional personnel will be hired or
re-allocated to support the procurement activities on this project.

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