Process Description

1. Plan Procurement Management [Process / Planning] – In this process, we do the followings:
1. We conduct “Make or Buy” analysis and take “Make or Buy” decision.
2. We design procurement statement of work for the items we decide to procure.
3. We decide evaluation criteria.
4. We develop procurement documents which are called Request for Proposal (RFP), Invitation for Bid (IFB), Request for Quotation (RFQ) or Tender.
5. We develop Procurement Management Plan in which we describe procedure for conducting, controlling and closing procurement.
6. We decide the contract type:
     a. Fixed Price – It is used when the scope is clear. Risk is on the seller.
     b. Cost Plus – Reimburse all expenditures plus profit. It will be used when the scope is not clear. Risk is on buyer.
     c. Time and Material – Risk is shared.

2. Conduct Procurements [Process / Executing] – In this process, we do the followings:
1. We send Request for Proposal (RFP) to the sellers.
2. We hold “Bidder’s Conference” to ensure all bidders understand the procurement item fully and equally and with no partiality.
3. We obtain proposals.
4. We evaluate proposals.
5. We select sellers and award contract.

3. Control Procurements [Process / Monitoring and Controlling] – In this process, we do the followings:
1. We make payment of invoices.
2. We deal with claims and disputes.
3. We keep all procurement documents properly.
4. We check performance of the contractor. In case of variance:

a. Find causes
b. Find corrective actions
c. Recommend it to Integrated Change Control for approval

After approval, there are 4 duties:
a. Give it to execution for implementation
b. Write approved changes in the Project Management Plan
c. Write lessons learned in OPAs
d. Inform concerned stakeholders

Exercise: Answer at-least 80% of the questions correctly in order to master the topic.
20 Questions Challenge
50 Questions Challenge