Project Procurement

Management
PREPARED BY:
AQIB AKHTAR
FAIZ MUHAMMAD AWAN
Project Procurement Management

 Most projects require some form of external purchasing

(procurement) in order to meet their goals. 
 Executing these procurements to fulfill the needs of the project falls
under the knowledge area of Project Procurement Management
OR
 Procurement (or purchasing) is the process for an organization to
obtain products or services from external parties (market
supply) to ensure that production and business activities are
smoothly carried out. 
Why we need procurment

 To allow the client organization to focus on its core business

 To access skills and technologies
 To provide flexibility
 To increase accountability
Processes of procurement

Three processes are invloved:

 Plan Procurement Management

 Conduct Procurements

 Control Procurements
Plan Procurement Management

During the project planning phase the procurement needs of the project
are identified. For each external vendor requirement, a Statement of
Work is composed which is known by many names (Terms of
Reference, Scope Statement, etc.) but serves as a written statement of
what work the contractor will do. Procurement documents normally
consist of a Request for Proposal, Invitation to Tender, or the like, with
the Statement of Work included as an attachment. Thus it is the guiding
document to the project team and the more specific it is, the better the
boundaries of each organization’s work is defined.
Plan Project Managment

Input Tools & Technique Output

 Project charter  Expert judgment  Procurement management
plan
 Business documents  Data gathering
 Procurement strategy
 Project management Market research
 Bid documents
plan  Data analysis
 Procurement statement of
 Project documents Make-or-buy analysis
work
 Enterprise  Source selection analysis
 Source selection criteria
environmental factors  Meetings
 Make-or-buy decisions
 Organizational process
 Independent cost
assets estimates
 Change requests
 Conduct Procurements
 it is defined as the process of getting responses from potential sellers, choosing a seller,
awarding the contract to the chosen seller.
  It is vital to take note that there are two roles involved in conduct procurement and these
include the buyer and seller.
 During the process, the team gets bids from potential sellers and they will apply defined criteria
to choose which sellers are qualified to perform the work. Single or multiple sellers may be
chosen during the conduct procurement depending on the nature of the project.
 The output of the conduct procurement should be documented. In most cases, the document will
be created by the buyer and sent to the sellers which contain a clear description of work that
needs to be performed during the entire project management life cycle.
Controlling procurements

Controlling procurements involves monitoring contract

work, evaluating the quality of project work, making changes
to the contract as and when required, and making sure that
work is done as per the terms written in the contract.
Why we need it
seller’s team does not report to you. And having contracted the work
out you need to put checks and balances in place to understand how is
the work being progressed
Control Procurements
Input
 Project management plan
 Project documents
Agreements
 Procurement documentation
 Approved change requests
 Work performance data
 Enterprise environmental
factors
 Organizational process assets
Tools & Technique Output
 Expert judgment  Closed procurements
 Claims administration  Work performance
information
 Data analysis
 Procurement documentation
 Inspection updates
 Audits  Change requests
 Project management plan
updates
 Project documents updates
Organizational process assets
updates