Chapter 12

Planning Procurement

TOPICS COVERED

Project Procurement Management

Plan Procurement Management

Project Procurement Management

Project Procurement Management includes the processes necessary to purchase or acquire products, services, or results needed from outside the project team.

Procurement management includes planning the procurement approach, selecting the contract type, developing bid documents, determining source selection criteria, negotiating a contract, and then managing the contractual relationship and performance throughout the life of the contract. For large projects, this can include many contracts and requires integrating multiple sellers with the work of the performing organization.

Procurements deal with contracts, which are legally binding. Contracts may be called subcontracts, purchase orders, agreements, or other various terms. Because they are legally binding and in many cases they are worth substantial amounts of money, the project needs legal, contracting, and purchasing expertise represented on the team. There are generally a whole set of policies, procedures, and processes associated with major procurements.

Some organizations “purchase” goods or services from other departments in the same organization. This is called intradivisional work. While many of the processes are the same, we will focus on external procurements. In some situations an organization may partner with another organization to win business. These are called teaming agreements. ...

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