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managing projects > procurement > Flashcards

procurement Flashcards

1
Q

project procurement management

A

includes the processes required to acquire goods and services from sources outside the company’s own resources

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2
Q

another definition for procurement

A

a process for establishing contractual relationships to accomplish project objectives

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3
Q

3 phases of procurement

A
  1. plan procurement planning
  2. conduct procurements
  3. control procurements

plan -> conduct -> control

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4
Q
  1. plan procurement management
A

process of documenting project procurement decisions, specifying the approach, and identifying potential sellers

(procurement approach & potential sellers)

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5
Q

what does this phase involve

A

considering whether to procure, how, what, how much, and when

(poor decisions can result in going over budget or being late)

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6
Q
  1. conduct procurement management
A

process of obtaining seller responses, selecting a seller, and awarding a contract

(obtain-select-award)

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7
Q

another word for procurement?

A

outsourcing

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8
Q

three stages of conduct procurement?

A
  1. solicitation planning
  2. source selection
  3. contract selection
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9
Q

what is solicitation planning

A

prepare packages of work, develop bids and proposals, develop evaluation guidelines

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10
Q

what can you use to prepare packages?

A

use WBS to prepare packages of work for the bidding process

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11
Q

what is the outline for bids and proposals?

A
  1. client information
  2. client contact information
  3. project name
  4. purpose of the proposal and project
  5. services or products that would be provided
  6. pricing information
  7. additional terms and conditions of the agreement
  8. estimated project timeline
  9. signature of both parties
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12
Q

why do you develop an evaluation criteria

A

to select the best bidder for your project

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13
Q

what is source selection?

A

receive bids and proposals, disqualify bids and proposals, evaluate bids and proposals

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14
Q

3 steps in bid analysis

A
  1. receive - on time
  2. disqualify - late/incomplete/fraud or bribery/non-compliance
  3. evaluate - points of how much it meets your criteria
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15
Q

what is the evaluation criteria

A
  • used to rate or score bids and proposals
  • objective or subjective, involve interviews
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16
Q

what does evaluation critieria include?

A
  1. purchase price
  2. understanding projet need
  3. total cost
  4. technical capability
  5. quality of previous work
  6. management approach
  7. financial capacity
  8. time to complete
17
Q

what is prototyping

A

method of obtaining early feedback on requirements by providing a model of the expected product before actually procuring it

18
Q

what is contract selection?

A

choose contract type, negotiate contract, control change, use grandmother principle

19
Q

weighted matrix approach

A
  • used to score performance against agreed criteria
  • highest weighted scorer would be selected to sign a contract
20
Q

what are the contract types?

A
  1. lump sum (fixed price)
  2. cost reimbursement
  3. cost-plus
  4. unit price
  5. time and materials
21
Q

what is a lump sump contract?

A

complete all work for one price

22
Q

what is a cost reimbursement contract?

A

determine the estimate cost before the project starts then pay to the extend described in the contract

23
Q

what is a cost plus contract?

A

client pays all costs plus extra to cover profit and overhead

24
Q

what is a unit price contract?

A

the cost is set for each unit (for example 250$ per metre)

25
Q

what is a time and materials contract?

A

vendor charges by hour/day/moth for their time plus costs for materials

26
Q

what does contract negotiation involve

A
  • clarification and mutual agreement on structure and requirements of contract prior signing
  • usually undertaken with legal advice assistance
27
Q

what is change control

A
  • changes arising from sellers or project team
  • these need to be monitored and controlled using a requirements traceability metric
28
Q

why do they need to be managed

A
  1. beneficial
  2. compatible with overall project deliverables
  3. confirmed in terms of price
  4. approved
  5. completed to agreed standard
29
Q

what is the project change control process

A
  1. request a change
  2. project manager analyses the change (feasibility/impact)
  3. present change to leadership
  4. leadership makes decision
30
Q

what is the grandmother principle

A

a way to ensure the contract is structured and controlled is a way that promotes partnering, reciprocity, and forbearance

31
Q

what are the 5 main steps to deliver procurement management?

A
  1. specification and planning
  2. identifying and selecting suppliers
  3. proposal requesting, negotiating, and contracting
  4. control and delivery
  5. measurement and analysis
32
Q
  1. specification and planning
A
  • Create a clear procurement plan for needed goods and services, both inside and outside the company.
  • Make a detailed list to set a budget and stay organized for smoother progress.
33
Q
  1. identifying and selecting suppliers
A
  • research and identify potential suppliers who meet your company’s needs precisely.
  • compare suppliers to understand their advantages and drawbacks.
  • analyze vendor selection criteria
34
Q
  1. proposal requesting, negotiating, and contracting
A
  • request proposals and negotiate with shortlisted suppliers.
  • negotiations reveal supplier reliability
  • clearly communicate requirements
  • set precise delivery schedules.
  • sign a contract when all terms are agreed upon.
35
Q
  1. control and delivery
A
  • control deliveries and payments through the purchasing department after signing the contract.
  • hold regular vendor meetings and track deliveries meticulously.
  • review all orders against set specifications and quality standards.
  • adjust procurement contracts over time if needs change.
36
Q

measurement and analysis

A
  • analyze the procurement process using key performance indicators.
  • identify areas for improvement and suggest changes.
37
Q

conduct procurement may be risky, why?

A
  1. due to some desired sellers may not have the capacity to bid on your project
  2. due to desired seller having their bid disqualified for incompleteness
  3. due to the seller not wanting to use your standard contract
38
Q

3 types of procurement?

A
  1. business-to-business procurement platforms are a type of business facility offered by the internet
  2. online procurement
  3. just-in-time procurement management system that provides the production line with components as they need them
39
Q

what is the pricing dilemma faced by the bidder

A
  1. reducing their profit and increasing their chance of winning
  2. increasing their profit and reducing their chance of winning

managing projects (3 decks)

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