Wayne State University Procurement Management Important Concept & method & terms Write a two page paper regarding what you thought on “Procurement Manageme

Wayne State University Procurement Management Important Concept & method & terms Write a two page paper regarding what you thought on “Procurement Management” and what was the most important concept(s), method(s), term(s), and/or any other thing that you felt was worthy of your understanding. Define and describe what you thought was worthy of your understanding in half a page, and then explain why you felt it was important, how you will use it, and/or how important it is in project planning.Strict APA Format with in text citation and 2 references. No plagiarismAlso, need to reply for 2 other discussions with minimum of 200 words. (I will post the discussions of other students once I get it.)Please refer to the below attachment to complete the assignment Procurement
Management
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Project Management
Chapter 13: Procurement Management
Procurement Management
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Importance
Make or buy decision
Types of contracts
Procurement cycle
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Project Management
Chapter 13: Procurement Management
Procurement Management
• The acquisition of products or services not produced or
delivered by the project team
• May require the assistance of experts
• Your project may be on the other side also—providing
services to another organization
• Legal implications of signing a contract
• The make or buy decision
• Expertise
• Resource availability
• Licensing, regulatory requirements
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Project Management
Chapter 13: Procurement Management
Procurement Management
• Fixed Price
• Cost reimbursable
• Time and materials
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Project Management
Chapter 13: Procurement Management
Fixed Price Contract
Figure 17.6.1: A fixed price contract the cost constant regardless of effort
applied or delivery date.
Illustration from Barron & Barron Project Management for Scientists and Engineers,
http://cnx.org/content/col11120/
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Project Management
Chapter 13: Procurement Management
Cost Reimbursable Contract
Figure 17.6.2: In a cost reimbursable or cost plus contract, the seller is
guaranteed a fee.
Illustration from Barron & Barron Project Management for Scientists and Engineers,
http://cnx.org/content/col11120/
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Creative Commons Attribution 3.0 Unported License (CC-BY).
Project Management
Chapter 13: Procurement Management
Time and Materials
Figure 17.6.3: In a time and materials contract the cost (or revenue to the
vendor) increases with increased effort.
Illustration from Barron & Barron Project Management for Scientists and Engineers,
http://cnx.org/content/col11120/
This work is licensed under a
Creative Commons Attribution 3.0 Unported License (CC-BY).
Project Management
Chapter 13: Procurement Management
Fixed Price Contract types
Figure 17.6.1.1 Table of Fixed Price Contracts and Characteristics
Source: http://pm4id.org/9/5/
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Project Management
Chapter 13: Procurement Management
Cost-Reimbursable Contract
Types
Figure 17.6.2.1 Table of Contract Types and Characteristics
Source: http://pm4id.org/9/5/
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Project Management
Chapter 13: Procurement Management
Procurement Cycle
• Procurement Plan
• Selecting the Contract Approach
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Skill level, uniqueness
Type of relationship: supplier, vendor, partnership
RFP, RFQ, personal contact
How well known is the scope of the work?
Risks—what are they? Who assumes them?
How much float if any?
How important to be sure of cost in advance?
• Soliciting bids
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Project Management
Chapter 13: Procurement Management
Procurement Cycle – continued
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Qualifying bidders
Request for Quote (RFQ)
Request for Proposal (RFP)
Evaluating the bids
• Usually a matrix approach
• Cost is NOT the only consideration
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Awarding the contract
Managing the contracts
Logistics and expediting
Change coordination
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Project Management
Chapter 13: Procurement Management
Procurement Management
Summary
• Make or buy analysis
• Contract types
• Fixed Price
• Cost reimbursable
• Time and materials
• The Procurement Cycle
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Bidder qualification
RFP or RFQ
Analysis and selection
Contract negotiation
Contract administration
Contract closure
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Project Management
Chapter 13: Procurement Management
Chapter Summary
• Procurement is an important activity for project
managers
• Procurement management includes deciding about
contracts and relationships with vendors, suppliers,
partners
• All stages of procurement should be closely monitored
• Reporting to the team and to management are
important components in budget and procurement
management
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Project Management
Chapter 13: Procurement Management
Questions?
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Project Management
Chapter 13: Procurement Management

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