PMgt 661: Project Procurement and Contract Administration (2Chrs)

1-1
 COURSE OUTLINE CONTENTS

1-2
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc.,All Rights Reserved.
 Course Description

The course predominantly deals with;

 Project procurement issues
 Project Logistics
 Contract Administration
 Resource mobilization, supply of resources to project, project
transportation management, and managing inventory and warehousing.
 Contract management and control processes
 purchase orders
 legal and regulatory structure of contracts
 The role of project managers in contract
 contracting process

1-3
 Course Objectives

After completing this course the students will be able to;

Applying materials management and logistics principles ( Getting the right
quality, quantity, price, time and from the right source to supply resource for
successful implementations of projects).
Identify contract components and understand the process from start to finish.
Understand the legal languages of project management contract
Negotiate favourable terms and make revisions to the contract
Administer contracts appropriately, and known when and how to terminate
before or up on completion
Understand the importance of project procurement management and the
increasing use of outsourcing for projects.
Describe the supplier selection process and recognize different approaches
for evaluating proposals or selecting suppliers.
 Discuss the importance of good contract administration, and describe the
contract closure process.
1-4
 CHAPTER ONE: OVERVIEW OF PROJECT
PROCUREMENT

1.1. What is project logistics?

1.2. What is procurement?
1.3. What is Project Procurement Management?
1.4. Goals of Project Procurement
1.5. Establishing standard Procurement procedures and Policies
1.6. A generic Project Procurement Process

1-5
 CHAPTER TWO:
PROJECT PROCUREMENT PLANNING AND
ANALYSIS
2.1. Procurement requirement analysais
2.3. Make or-Buy Decisions: A theoretical Perspective
2.4. Factors influencing Make-or-buy decisions
2.5. The transaction cost approach
2.6. The capability approach
2.7. The resource based view and the make-buy decision

1-6
 CHAPTER THREE:
PROCUREMENT METHODS AND STRATEGIES

3.1.Introduction
3.2. Sourcing and Supply Management Strategies
3.3. Project Procurement Methods
3.4. Project Procurement Standard Bid Document Preparation
3.5. Competitive Bidding Process

1-7
 CHAPTER FOUR:
SOLICITATION PLANNING, SOLICITATION, EVALUATION AND
SELECTION OF SUPPLIERS

4.1. Introduction
4.2. Solicitation planning
4.3. Solicitation
4.4. Key supplier evaluation criteria
4.5. Supplier Selection

1-8
 CHAPTER FIVE:
PROJECT LOGISTICS MANAGEMENT

5.1. Project stores and Materials Management

5.2. Transport Management in Project
5.3. Physical Distributions Management in Project

1-9
 CHAPTER SIX:
PROJECT CONTRACT ADMINISTRATION

6.1. What is contract Administration? (Legal relationship)

6.2. Elements of a Contract (Mutual agreement, offer, acceptance;
adequate consideration, capacity, legality)
6.3. Types of Contracts and contract strategies
6.4. Long-Term contracts in alliances and Partnership
6.5. Non-traditional Contracting
6.6. Settling Contractual Disputes
6.7. Contract Close-outs

1-10
 CHAPTER SIX:
PROJECT CONTRACT ADMINISTRATION

The 4 Different Types of Contracts

1. Lump Sum Contract or fixed price contract (sets one determined
price for all work done for the project)
2. Unit Price Contract
3. Cost Plus Contract
4. Time and Materials Contract
The overall requirements of a contract administrator
generally include the following:
 Meets the performance of contract with its requirements
 Attention to detail and the ability to spot errors and inconsistencies.
 Excellent reading and language comprehension.
 Ability to work with a team at all levels of an organization.
 Effective ability to negotiate and execute contracts.
1-11
 Assessment Scheme

Individual Term Paper-----------------------------20%

Group Project w-------------------------------------30%
Final Exam------------------------------------------- 50%
Total ---------------------------------------------------
100%

1-12
 What is Good Research? (cont.)

• Following the standards of the scientific

method (cont.)
– Adequate analysis for decision-
maker’s needs
– Findings presented unambiguously
– Conclusions justified
– Researcher’s experience reflected

1-13
 The Manager-Researcher Relationship

• Manager’s obligations
– Specify problems
– Provide adequate background information
– Access to company information gatekeepers
• Researcher’s obligations
– Develop a creative research design
– Provide answers to important business
questions

1-14
 Manager-Researcher Conflicts

• Management’s limited exposure to

research
• Manager sees researcher as threat to
personal status
• Researcher has to consider corporate
culture and political situations
• Researcher’s isolation from managers

1-15
 When Research Should be Avoided

• When information cannot be applied to a

critical managerial decision
• When managerial decision involves little
risk
• When management has insufficient
resources to conduct a study
• When the cost of the study outweighs the
level of risk of the decision

1-16