Procurement managers need to wear many hats and one of these might be project management.
A PM plans the sequence of activities and delegates work to others. The main actions of a project manager are to plan, delegate, monitor and control.
Typically we want to control cost and look for opportunities to reduce cost. When running tenders or managing contracts we want to make sure that projects are completed on time.
We want to control the quality of our work and reputation and we want to work with stakeholders to pin down the scope of the project. What will be delivered at the end of the tendering process?
Using Prince2 principles is helpful in guiding the way we manage projects.
Project management for procurement managers
- Business Case- why do we need the contract to deliver what benefit
- Organisation- Who it for
- Quality- what quality standards are required
- Plans, how will it be delivered, how much will it cost, when will it be delivered
- Risk- what are the risks?
- Change- what is the impact, is change management built-in
- Progress- how is this measured, baseline and future desired state
A business case should follow the following path
Pre project, use an outline business case
The project is initiated
A detailed business cased is verified
- Delivery stages
- Benefits are confirmed
- Final delivery completed
- Benefits are confirmed, verify & update business case
- Confirm benefits
- Post project evaluation
- Confirm benefits
A project manager or procurement manager should be aware of and manage risks
#identify # assess #plan #implement and always communicate
Types of responses
- Avoid
- Reduce
- Fallback
- Transfer
- Share
- Accept
- Exploit
- Enhance
- Reject
Ask if there is a project initiation document. A PID is documentation used to define the project and includes the scope of the project. Typically some background work is completed to check that the department has a sound rationale and basis for the assessment of cost and resources before a financial commitment is requested. The findings can be used as a baseline and act as a single source of reference. It’s very handy to read to get up to speed, especially if procurement is late to the table.
The Project Manager is accountable to the project board. The board is interested in the corporate or programme management of the project to ensure success. The project board can give the mandate or authority required and can also delegate decisions or act as the authority for major changes.
This next section is written by my AI writer
Procurement project management is a comprehensive activity that requires careful planning by highly astute procurement professionals to ensure that end goals are achieved. Procurement project management is a structured process for defining, planning, implementing, controlling and moving activities from the current state to the future. Project management includes an understanding of desired outcomes, the ability to communicate effectively, awareness of associated budget constraints, and
personnel and resource issues. When done right, project management offers many benefits, described below, including setting measurable goals, understanding risks, making processes transparent, and more opportunities to discuss supply chain
improvements.
Integrating project managers into the procurement process not only greatly increases the chances of a successful procurement, but it also increases the chances of on-time and on-budget execution. Using planning, communication planning, risk management, and other project management processes, these purchases satisfy stakeholders by setting expectations, communicating status consistently, and achieving the best value for money.
Project procurement management is the selection, coordination and maintenance of external materials and resources and is an essential part of the successful completion of a project.
Procurement management can help organizations better understand the costs associated with completing a project and can help them select products and services from vendors that best suit their needs without going over budget. Purchasing management is a way to manage purchases, requisitions, orders, expediting,
reviews, and approvals more efficiently and productively.
In terms of project management, procurement is when you need to buy, rent, or contract external resources to achieve project goals.
After the procurement plan is complete, the project procurement manager evaluates supplier proposals and selects partners based on project needs. The process is compiled into a procurement management plan that includes requirements documentation, risk registers, asset resource requirements, project planning, asset cost estimates, and more.
Many times, managers use a written document as a project procurement plan, addressing the above considerations and detailing any other important information, such as how to manage delivery dates or changes to contract terms. The plan includes all material and service specifications such as minimum quality requirements. The plan will most likely be developed with input from the entire project team, including the purchasing team, the legal team (if you have one), and any other relevant subject matter experts in the company.
This article explains how to successfully initiate, plan, manage, and complete both simple and complex procurement projects. It shows project managers all the stages and processes used in procurement and explains to procurement professionals how adding and applying specific project management processes and methods to their skills can significantly improve both their company’s procurement results and their career opportunities. First, successfully managing procurement projects—or
projects of any type—helps your team and company achieve their mission.
Procurement project management requires a well-defined set of skills and competencies, knowledge, processes, methods and objectives if the result is to be desired and meet the needs of stakeholders.
Procurement work, and purchasing in particular, is quite often project-based, so purchasing departments must use their project management skills and processes frequently. The project manager is expected to understand what the procurement experts will need, provide the experts with this
information, and then cooperate with the purchasing department throughout the duration of the procurement.
The procurement team determines the level of risk that the entire project will manage and what risks will be transferred to the contractor/ supplier. The Supplier Contract Manager ensures that the bidding contractors have the skills and ability to complete the work in accordance with the project schedule and monitors the performance of the supplier against the needs of the
project, providing support and guidance when needed. Once contracts become active, procurement control and management becomes an important element in maintaining partnerships with suppliers and ensuring that services and products work properly throughout the project.
Once procurement has been completed and a contract has been signed with the supplier, the project manager plays a vital role in supporting the contractor/ supplier during the implementation of the project and ultimately the commissioning of the software/services. The role of Project Managers is to ensure that each supplier identifies their own Project Manager to act as the single point of contact during procurement, and to coordinate with Project Managers to schedule meetings/demonstrations, receive proposals, answer questions and facilitate . negotiation processes.
It can be a waste of budget if you don’t manage them carefully throughout the project, so the project management step in the process is all about incorporating important activities into your overall project management plan. The time spent in the project procurement cycle can affect the planning of critical activities, including the decision to do the work yourself or outsource it to others. Factors such as procurement of goods, selection of a contractor, and reliability of suppliers can affect the completion of a project, so it is important to optimize factors such as procurement of goods as
efficiently as possible.
Developing and implementing an effective change management process for key contractors and suppliers
will minimize conflicts between team members and the potential negative impact on the entire project.
| Project Name | Description | Procurement Method | Start Date | End Date | Budget | Description | Responsible Person | Actions | Priority | Status | Last Update | Notes |
| Milestone 1 | High Priority | In Progress | ||||||||||
| Milestone 2 | High Priority | In Progress | ||||||||||
| Milestone 3 | High Priority | In Progress | ||||||||||
| Milestone 4 | ||||||||||||
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