Sourcing Flashcards
Where should you include any incentives or disincentives?
In the scope of work
Define benchmarking
The act of measuring a: Process Service Product Against the characteristics of recognized leaders
You could use best practices and __________ when you want to provide a more cost-effective way to accomplish a task.
Benchmarking
What are two areas where an organization might want to use benchmarking?
When measuring Internal efficiencies Customer satisfaction
What three characteristics should good benchmarks have?
They should be attainable, quantifiable, and realistic
Who should be put in charge of changes in a process and the success and failure of these processes?
Management
Name two ways besides benchmarking that organizations can measure performance
Staff meetings Performance reviews Performance targets
What are the three phases of an audit?
Planning Collecting data Decision making based in the data collected
Name six types of data
Qualitative Quantitative Longitudinal (repeated observations over time) Cross sectional (many subjects observed at the same point in time) Primary Secondary
What ways should specifications be stated?
Functions Physical characteristics Performance required Combination of above
Name four categories of procurement
Lowest responsible and responsive bidder Best value Gathering information Special methods
Name the types of bids for lowest responsible and responsive bidder
Competitive bid/invitation for bid Quotes RFQ (usually small dollar value, do not have to advertise, predetermined date) Informal bid - quote based on letter, fax, email (low value)
Name types of bids for best value
RFP ITN RFQu
Give examples of procurement methods OTHER than competitive, best value or information gathering.
Notice of Intent - no formal competitive sourcing Small dollar or pcard - this reduces administrative burden, buy directly from contract Emergency procurement Sole source procurement - only one supplier, inability to obtain competition
Who should exercise control and direction for any cross functional team who is developing the scope of work?
The procurement staff
What is the definition of best value
Return on total cost of ownership or life cycle cost
Name three things you consider when determining total cost of ownership
Licensing fees Site prep. Costs Training costs
What does life cycle costing consider?
Operating, time value of money, residual value, disposal.
What is Value Procurement
When total cost to the environment is included in the value formula during the planning phase
Should you calculate TCO/LCC for all proposals?
Only those that make the short list.
Name the principles for Make or Buy Analysis
- Consider all costs… Eg. Contract management. 2. Only consider costs that will differ - if the costs will be the same regardless if make or buy, don’t consider them 3. Ensure you consider costs for the same level of service and quality
What are the four steps to make or buy analysis
- Define the outputs you are considering 2. Determine the costs SAVED if outsourced 3. Determine the costs you will PAY if outsourced 4. Compare the costs and make decision
How do operating and finance leases differ in terms of reporting them on financial statements?
Operating is an expense on the income statement Financial is a liability on the balance sheet
If obsolescence is an issue and you just have short term requirements, what kind of lease is best?
An operating lease
