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Thursday, June 6, 2013

Six Components of a Procurement Management Plan


Six Components of a Procurement Management Plan
The Procurement Management Plan is a part of the overall Project Management Plan. The document describes how items will be procured during the project and the approach you will use to managing vendors on the project. Specific areas to describe include:
Procurement process. This section provides a brief overview of the process requirements necessary to manage procurement of the identified needs. This process should include:
  • Initiating a request
  • Development of requirements (technical, timing, quality, constraints)
  • Request approval
  • Purchasing authority
  • Bid / proposal review
  • Contract management responsibility
  • Contract closure requirements
  • Procurement process flowchart
Roles and responsibilities. This section describes the various roles on the project that have some connection to procurement. This section should describe who can request outside resources, who can approve the requests, any secondary approvers, etc.
Identified procurement needs. This section details the material, products or services identified for outside procurement.  Each listed item should include a justification statement explaining why this should be an outside purchase if there is the possibility of inside sourcing (make vs. buy decision).
Timing. This section will describe the timeframe that resources are needed. This will provide a better sense for when the procurement process needs to be started for each item.
Change review and approval process. Describe how changes are made to procurement documents to ensure the changes are valid, understood and approved by the appropriate people.
Vendor processes. Describe the processes that the vendors should use for timesheet approval, invoice processing, contract renegotiation, status reporting, scope change requests, etc.
There may be additional information in the plan as well to ensure the procurement process is understood and managed effectively. 
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