Chapter 12 Program Procurement Management

Mahindra Satyam 2009

Procurement Management
Describes the processes, inputs, tools and outputs associated with performing procurement for a program Focuses on obtaining economies of scale Ensures overall quality and integration of procured components

Program Procurement Management Processes Plan Program Procurements Conduct Program Procurements Administer Program Procurements Close Program Procurements

Group P E M&C C

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Program Procurement Management

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12.1 Plan Program Procurements

Determining what to procure Risk Management Developing the following for procurement

Strategies Tools Methods M ti Metrics Assessment parameters Reporting p g and review mechanisms Intervals for revisiting contracts

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Plan Program Procurements

Tools and Techniques Competitive analysis of service providers Procurements planning Expert judgment Assessment of organizational competencies Make-or-buy analysis

Inputs M Marketing k ti environmental factors Program budget allocation a ocat o Component scope statements Program charter

Outputs P Program budget b d t estimate updates Program procurement management g p plan Contract management plan Qualified seller list

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Plan Program Procurements Data Flow Diagram

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Procurement Management Plan

Component Statement of Work updates Contract type Identification of required and available resources Sourcing decisions Identification of required procurements Proposals Q lifi d seller Qualified ll lists li t Management of contracts

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12.2 Conduct Program Procurements

Acquire the desired services, resources, products or materials so that the program meets its objectives Involves identifying potential suppliers, issuing RFPs, supplier selection, agreed contracts and eventual supplier engagement Also involves agreements for insurance or services to de-risk the program

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Conduct Program Procurements

Tools and Techniques Procurement planning Bidder conferences Distribution of RFPs Develop qualified seller list Contract negotiation Proposal evaluation system Expert judgment Contract management procedures Change control procedures Seller selection

Inputs
Program assets Subcontract procurement plans Program procurement management plan Program management plan Qualified seller list Contract management plan Component cost estimates

Outputs Selected sellers Identified internal service providers Request for proposals Contract management plan updates Program procurement management plan updates Contracts Component payment schedules updates
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Conduct Program Procurements Data Flow Diagram

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Proposal Evaluation Systems

Weighting system Screening g system y Seller rating system

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12.3 Administer Program Procurements

Ensures that conditions and requirements of the agreements are understood and adhered to Ensures that formal relations between the customer and supplier are not terminated before all requirements have been met This includes:

Deliverables are delivered as specified Id tif i when Identifying h agreement t conditions diti are violated i l t d Relationship is terminated as stipulated Post-program p g commitments are fulfilled as agreed g

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Administer Program Procurements

Tools and Techniques Change control system Engage and manage suppliers Payment control system Contract performance review Inspection and audits Budget management system

Inputs Program procurement management plan Program budget baseline Contracts Approved change requests Program performance reports t Payment approval requests Component payment schedules
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Outputs Program budget baseline updates Program procurement management plan updates Contracts updates Program budget updates Program performance reports updates Payment approval Program payment schedules updates
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Administer Program Procurements Data Flow Diagram

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Engaging and Managing Suppliers important factors

Contracts

Contract types yp Country of origin

Contract Management plan Program Procurements Management plan Performance reports Change management

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12.4 Close Program Procurements

Concludes all procurement activities in a program This includes:

Notifying program and component stakeholders, and the finance department Ensuring all contract conditions are met Reviewing contract termination clauses and warranty arrangements

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Close Program Procurements

Tools and Techniques Contract closure procedure Supplier performance review Budget allocation reconciliation Outputs Closed contracts Procurement performance reports Closed budget allocation

Inputs Program management plan Contracts Program budget Program performance reports Component closure notification tifi ti

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Close Program Procurements Data Flow Diagram

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Questions?

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