Summary

The project manager should be involved in the procurement management process as early as possible, but should delegate day-to-day procurement to professional procurement staff, where they are available. This should result in a contracts manager being appointed from those staff to the project. Procurement is risky and the basis for managing all the risks is to understand and state in the procurement documentation, such as contracts with suppliers, exactly what it is that the project needs. This requires research and analysis. IT procurement is especially risky.

The first step for the project manager is to know the people, experience and capabilities of the procurement people in their organization, and to understand the existing procurement processes and standards and the legal terms and conditions normally used. A key decision is sometimes the make-or-buy decision, and this is usually a matter of which risks are preferable. The project manager's job is to get the decision made by the relevant stakeholders, not to make it themselves. Any time required for procurement management processes must be included within the project's schedule. The work involved to generate the procurement documentation, consider prospective bidders, wait for the sellers' responses, select a seller and then negotiate a contract may often require a significant amount of time to complete.

Work for the project manager continues after the contract has been signed, because there is the need to monitor and control the contract. Administrative activities required to be undertaken involve verifying the scope is being met, checking invoices and paying bills, together with the need to confirm that the seller is complying with the terms and conditions of the contract. Once everything is delivered and completed satisfactorily, or a contract is terminated before the work is completed, the last stage is to conduct contract closure to safeguard the legal interests of both buyer and seller.

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Definitive Guide to Project Management. The Fast Track to Getting the Job Done on Time and on Budget
The Definitive Guide to Project Management: The fast track to getting the job done on time and on budget (2nd Edition)
ISBN: 0273710974
EAN: 2147483647
Year: 2007
Pages: 217
Authors: Sebastian Nokes
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