Plan Procurement

Management Process –
Outputs
• Bid Documents
• Request for information (RFI). An RFI is used when more information on
the goods and services to be acquired
is needed from the sellers. It will typically be followed by an RFQ or RFP.

• Request for quotation (RFQ). An RFQ is commonly used when more

information is needed on how vendors
would satisfy the requirements and/or how much it will cost.

• Request for proposal (RFP). An RFP is used when there is a problem in

the project and the solution is not easy
to determine. This is the most formal of the “request for” documents
and has strict procurement rules for content,
timeline, and seller responses.

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Types of Procurement Documents
• RFP - A request for proposal is an early stage in a procurement process issuing an invitation for
suppliers, often through a bidding process, to submit a proposal on a specific commodity or
service.
• RFI - A request for information (RFI) is a proposal requested from a potential seller or a service
provider to determine what products and services are potentially available in the marketplace to
meet a buyer's needs and to know the capability of a seller in terms of offerings and strengths of
the seller.
• RFQ - A request for quotation (RFQ) is used when discussions with bidders are not required
(mainly when the specifications of a product or service are already known) and when price is the
main or only factor in selecting the successful bidder.
• Solicitations: These are invitations of bids, requests for quotations and proposals. These may
serve as a binding contract.
• Offers - This type of procurement documents are bids, proposals and quotes made by potential
suppliers to prospective clients.
• Contracts - Contracts refer to the final signed agreements between clients and suppliers.
• Amendments/Modifications - This refers to any changes in solicitations, offers and contracts.
Amendments/Modifications have to be in the form of a written document.
 Plan Procurement Management Process
Non-Competitive Forms of Procurement
• Does not involve a ‘Competitive’ (Bidding) Process’

• Only a single Seller is selected, through one of the following non-procurement processes:
• Single-Source (Preferred Seller)
• Sole-Source (Only-one Seller)

• Typical situations for non-competitive procurement

• Extreme schedule pressure
• Seller has unique qualifications (e.g. A well-known doctor, trainer or consultant)
• Only one seller who can provide goods or services (e.g. Windows ® by Microsoft)
• A seller holds a patent for the required item
• A seller holds exclusive rights for the required item (e.g. renting a hoarding/property, branding at Cineplex/Centaurus etc.)

• No time/effort to be spent in running a competitive process. However, procurement statement of work, and
finalization of contract must still be done

[Ref: PMBoK 5th Edition (C) Project Management Institute,

USA]
Single Source Procurement Definition
• Single source purchasing refers to purchases from one selected
supplier, even though there are other suppliers that provide similar
products. If your company decides to buy only Dell computers then
that is single source purchasing. However unlike sole source
purchasing you and your company have a choice to switch suppliers,
but for strategic and possibly cost reasons the company decides to
use only a specific supplier.
Sole Source Procurement Definition
• Sole source procurement however refers to those purchases where
there's only one supplier that provides the product. Usually these are
unique products that you cannot find anywhere but only thru one
supplier/manufacturer.

• So before you do anything else when dealing and negotiating with a

sole or single source supplier is to understand exactly that i.e.
whether you're dealing with a sole source or single source.
 Plan Procurement Management Process
Single source
• Scope: Tendency for the buyer’s organization to say, ‘the seller knows us and we know them; we do not have
to spend so much time determining our requirements and completing a procurement statement of work.
“They know what we want”

• Quality: Seller may never be asked to prove they have the experience, cash-flow, and man-power to complete
the new work. Also, the quality of work may not be consistently meeting stated requirements because the
seller knows they are not competing and may not complete work correctly the first time at the quality levels
expected

• Cost: It will be necessary to spend time comparing previous cost to the new cost to check if it is reasonable

• Schedule: Now that the seller knows they have you as a longer-term customer, they may not be as responsive
to your schedule requirements.

• Customer Satisfaction: Now that the seller has you as a longer-term customer, they may not be as responsive
to your concerns

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Sole Source
• Scope: You may have to change the work specified in the project to “take what
you can get,” rather than “ask for what you want.”
• Risk: What if the seller owns a patent and goes out of business? What if they take
on too much business and can’t complete all of the work on time?
• Risk: If the seller owns a patent and goes bankrupt, who owns the patent? How
will you get what you need from the seller?
• Quality: You may have to take what you get rather than request a certain quality
level
• Cost: Multiple-year agreements may be required for the purchase of items to
prevent a price increase in the future.
• Schedule: The seller has little incentive to agree to a schedule.
• Customer Satisfaction: The seller has little incentive to be concerned with the
buyer’s needs and desires
APPROVED CHANGE REQUEST [OUTPUT/INPUT]
An approved change request refers to a change request that has been
submitted by the requestors, has been reviewed by the appropriate
parties through use of the integrated change control process, and has
been granted authorization to be take place.

Approved change requests can take place at many points throughout

the project management process, and can range from very early stage
points in the process (such as a request to substitute an alternate
team member or an alternate location) or can be much later along
(such as a request to alter the deliverables or a request to receive an
extension to the deadline in which deliverables are scheduled to be
completed).
Work Performance Data

The raw observations and measurements identified during

activities performed to carry out the project work.
Examples include reported percent of work physically
completed, quality and technical performance measures, start
and finish dates of schedule activities, number of change
requests, number of defects, actual costs, actual durations,
etc.
Work Performance Reports
The physical or electronic representation of work performance
information compiled in project documents, intended to
generate decisions or raise issues, actions, or awareness.

Examples include status reports, memos, justifications,

information notes, electronic dashboards, recommendations,
and updates.
Work Performance Information
a. Work performance information is the raw data of the project’s
status, or you can say that it is the ‘as of now’ status of the
processes from each knowledge area. It refers to what work
has been completed, how much time has been elapsed, the
cost incurred, etc.
b. It provides us with information about the current status of
the project deliverables. This information is used in the
creation of work performance measurements and
performance reporting.
 Examples
Some examples of work performance information are as follows:
• How much of the work has been completed?
• What is the schedule’s progress; e.g. how many activities have been
completed, how many have been started and what is their current
status, etc.?
• What cost has been incurred to date?
• What are the quality metrics of the product such as the number of
defects and rejection rate, etc.
• What is the risk status, such as how many identified and unidentified
risks have occurred, what is the effectiveness of the response plan,
how much contingency or management reserve has been spent, etc.
?
• What is the procurement performance, such as how much work has
been completed by contractors, and how much have they been paid,
etc.?
Work Performance Measurements
Once you get the work performance information, you compare it
with your planned progress and come up with work performance
measurements. Put more simply, you can say that work
performance measurements are the comparison between the
planned and actual project parameters.
Examples
Some examples of work performance measurements are provided below.
• Schedule Performance
Here you will compare the planned schedule with the actual schedule.
For example, you have an activity that is scheduled to be finished within five days, and in work
performance measurements you can see how long it actually took to finish that activity.
• Cost Performance
Here you will compare your planned expenditure with the actual expense.
For example, what was the planned cost for an activity and how much did you actually spend to
complete it?
• Quality Performance
Here you compare the planned performance with the actual performance.
For example, you will measure how many defects, tolerance and threshold were allowed and how many
actually occurred. Based on this you might take corrective or preventive action.
• Risk Performance
Here you will see the effectiveness of your risk management plan.
For example, you will see how many risks have occurred versus your identified risks, and how effective
your risk response plan was, etc.
• Procurement Performance
Here you will compare the seller’s actual performance against the planned performance.
 Difference between Work Performance Information
and Work Performance Measurements
The following are a few differences between work performance information
and work performance measurements:
• Work performance information is the ‘as of now’ status of the deliverables
and work performance measurements are a comparison between the
actual status and planned status.
• Work performance measurements are developed with the help of work
performance information.
• Some examples of work performance information are the time elapsed
and money spent, and some examples of work performance
measurements are cost variance, schedule variance, cost performance
index, schedule performance index, etc.
Procurement Performance Review
Here you focus on bench marking the vendors/suppliers against
metrics such as on time delivery, cost, quality etc to help yourself-
buyer- to consider/eliminate them for future projects based on
the expereince you have on your recent projects with them. This
will serve as input for Select Sellers List process for future
projects
Inspection
Here you validate whether all the deliverables meet all the
specifications in the Purchase Order
Audit
Here you inspect few random/critical metrics/processes are
adhered to by the supplier. It can be within your organization or
within the external organization such as your supplier's.
Performance reporting
It is an important activity in project communication management.
It involves collecting and disseminating project information,
communicating project progress, utilization of resources, and
forecasting future progress and status to various stakeholders,
as decided in the communication management plan.
Types of reports
• Status reports: This gives the current state of a project at any
given time. This kind of report describes where the
project stands at that moment with regards to the performance
measurement baseline. Using this, managers can also get the
current snapshot of project with respect to the scope, time, cost
,and quality parameters.
• Progress Reports: This reports describes what
has been accomplished since the last time/last report.
• Forecasting Report: This report states what is expected to
happen on a project. This report predicts the future
performance and expected status of the project in various
parameters. This helps in tracking and allocation of resources
for better utilization.
Types of reports
• Trend Report: This report shows a comparision
between the current performance of the project and the last
performance of the project during same time duration. For
example, it can be compared monthly, quarterly, semi-annually
or annually. This report examines project performance over
time to see if it is improving or degrading.
• Variance Report: This report shows a comparision between
the planned progress and actual progress made.
• Earned Value Report: This report integrates project
performance on scope, schedule, and cost measures
using earned value management techniques. Usually the
components of this report are merged into status reports.
 Elaborate reports may include
• Analysis of past performance.
• Summary of changes approved in the reporting period.
• Current status of risks and issues.
• Results of variance analysis.
• Work completed during the reporting period.
• Work to be completed during the next reporting period.
• Forecasted project completion.
• Other relevant information to be reviewed and asked by
stakeholders.
Project Record management
Record management is a systematic approach for
organizing, planning and tracking documents during the
course of the project execution.
A-Z of Project Record Management
A record system is a systematic process in which an
organization determines the following considerations,
activities and characteristics:
• The type of information that should be recorded.
• A process for recording data.
• Handling and collecting of records.
• The time period for retention and storage.
• Disposal or protecting records, which relate to external
events.
• Elements in a record management system.
• Content analysis, which states or describes the record
system.
• A file plan, which indicates the kind of record that is
required for each project.
A-Z of Project Record Management
• A compliance requirement document, which will outline
the IT procedures that everyone needs to follow. This
will ensure that team members are fully compliant.
• A method, which collects out dated documents. These
should be done across all record sources such as e-
mails, file servers, etc.
• A method for auditing records.
• A system, which captures the record data.
• A system, which ensures monitoring and reporting in
the way which records are being held.
Three Stages of Records
In the project record management process, there are
three distinct stages. These stages have many other
activities involved in order to complete and accomplish
the objectives for each stage. The stages are:
• The creation of records
• Maintenance of records
• Storage and retrieval of records
Creating Records
This refers to the underlying reason as to why the
record is being created. This could be for a receipt or for
an inventory control report or some other reason.
The primary objective of project record management is
to determine the flow of the record handling once the
record is created. When it comes to creating records,
the following questions should be answered.
• Who will view the record?
• Who will be the final owner of the record?
• Who is responsible for storing the record?
Maintaining Records
• Developing an operation to store the records refers to
maintaining the records. The access levels to the
records should be defined at this stage and should take
all necessary steps in order to avoid the records
getting into the wrong hands.
• Proper compliance procedures and security measures
need to be in place to avoid misusing of records.
Storing and Retrieval
• Storing of records could refer to manual storage of
documents as well as digital storage. Project managers
need to ensure that the records are returned in the
way it was borrowed. Maintaining records also refers to
the amount of time that records can be maintained.
• Some organizations may retain records up to six years
whilst others less amount of years. If records are
saved digitally, proper folders need to be created.
Once created, the older documents need to be
archived so that hard drive space is retained.
An Insight to Record Management
Planning
• Records, which are collated needs to be planned. The
following outlines the steps that management needs to
take to ensure record planning process is successful.
• Identification of roles, which ensure that records are
managed properly
• Allocating dedicated roles or appointing dedicated people to
categorize the records, which are available in an organization.
• Appointing IT professionals to implement systems, which
maintain and support record management.
• Managers need to make sure that the team members
are aware of the procedures in place for record
management.
• The record management process needs to analyze the
content of the documents, which are to be saved.
An Insight to Record Management
Planning
• Implement a file plan, which will store the different
kinds of files in an organization.
• Develop retention schedules, which could vary from
one organization to another depending on the activity
taking place.
• Design effective record management solutions.
• Planning of how content can be moved to record
methods.
• Develop a plan where e-mail integration could be made.
• Plan a compliance procedure for social content.
• Develop compliance procedures that align the
objectives of project record system.