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The Procurement Team

The procurement team manages the creation and oversight of legally binding contracts.  The team is made up of representatives from all areas of expertise that are necessary to ensure that contracts are properly structured to protect the interests of the organization.

Procurement Team Players

  • procurement department
  • project team
  • legal
  • finance
  • marketing (optional)
  • IT (optional)
  • manufacturing (optional)
  • Others?

Contract Manager
The person assigned by the procurement office to take management responsibility for specific procurements is called a ‘contract manager’ or, in PMI terminology, a ‘procurement administrator.’

The contract manager is the team captain.  He or she provides administrative oversight for the steps and stages of ‘conducting’ procurement.  The contract manager controls ‘official’ communications with vendors based on feedback from members of the procurement team.

Promoting Bids
After procurement documents (bid packages) have been prepared in the planning stages, the procurement team take responsibility for the distribution of those documents to potential vendors.

Initial interest is generated by advertising in newspapers, industry publications, and/or on internet sites.

For complex procurements, advertising generally leads to a bidder or vendor conference.  At these conferences the buyer makes a presentation about what is being procured and why, and then remains available for questions.

The object of bidder conferences is to quickly and efficiently make vendors aware of requirements and conditions.

The managers of bidder conferences are obligated to ensure that questions are not answered in confidence.  The answer to every question that is asked, before and after the conference, must be made available to all bidders.

The next submission will discuss proposal evaluation techniques.



Don’t Miss This Leadership Opportunity

Committing to doing a proper ‘Lessons Learned’ followup for every project is important.

The time for Lessons Learned is as close after the lesson is discovered as possible. In many cases, this review is when any important phase or aspect of the project is completed. Reviewing and updating the Lessons Learned should be ongoing and is especially beneficial at the end of the project to ensure a clear account is maintained while it is fresh in everyone’s mind.

As the leader of this endeavor, you should plan a get together of key stakeholders and your team to review the ‘good, bad, and ugly’ items at every phase of the project – and after completion, too. It doesn’t matter whether the items were successful or dismal failures; allowing everyone to bare their souls and tell it like they saw it can alleviate the burdens heaped on their lives during the crux of the deadlines.

During the meeting, everyone should be able to voice their opinions about any and all topics. Everyone needs to be comfortable with what they are saying, who they are saying it to, and when they are saying it (which is, hopefully, not too late).

Anonymous surveys are one way to ensure everyone has the opportunity. Whether they respond or not is usually directly related to the perceived value or benefit. See if you can make doing the survey worth their while. Offer something tangible as the benefit, something that you would want if you were to do a survey for someone else or another department.

There is obvious benefit to the corporation from these Lessons Learned, but what about the benefit to your participants? What can they take away from this event? How about a clear conscience? How about a feeling of being heard? How about a message that they are important, are being listened to, and even more importantly, that their requests are being acted on.

This is a leadership event. You get to listen to your team as well as the clients, sponsors, and stakeholders. This is a great opportunity for building rapport and firing-up the team. Find out what each individual thought about the project to this point and what suggestions they can make for improvements, as well as ask them whether they witnessed any MVPs, specific accolades, and/or any outstanding efforts.

Another approach to consider is getting praise from the outside world and sharing it with your team. It will be beneficial for you and them.

Do not put a Lessons Learned opportunity off until it is too late! You will be surprised at how much of a relief your team will feel with being given a forum to voice their concerns as well as heap their praise on others.

Image from Microsoft Clip Art


Conduct Procurements

In PMI terminology, ‘conduct procurements’ takes off where ‘plan procurements’ ends.

Planning produces ‘bid packages.’  Conduct procurements takes these packages, publicizes and distributes them to potential vendors, and then manages the responses (bids).

Conduct procurements is complete when contracts have been awarded to vendors.

Multiple Rounds
It is not uncommon for there to be more than one round of bid documents distributed for the same procurement. Multiple rounds of bidding will occur if the preliminary documents were ‘research oriented’ (EOI, RFI) or if the buyers are surprised by bidder responses (e.g., price too high) and are  forced to revise their procurement plans.

Enter the Procurement Department
Most organizations have a procurement department of some form.  The role of this department is to protect the organization from the outside world.  Procurement professionals manage procurement risk.  They manage and monitor commitments being made to outside organizations.

Normally, projects are effectively separated from direct contact with the outside world (from a procurement perspective) by the procurement department.  Most project managers do not have the authority to spend their budget directly; instead, the procurement department acts as the intermediary between the project and outside vendors.  The objective is to ensure that the organization (and the project, indirectly) is treated fairly and does not create any unnecessary liabilities or obligations.

Even though there is a separation between project and vendor, project staff are encouraged to communicate directly with the vendor delivery teams. However, these communications are on a casual basis and do not result in legally binding commitments.  Discussions between the project team and vendor team are therefore ‘unofficial.’

When it comes down to the creation of legally enforceable commitments (contracts), the procurement department takes responsibility for managing the communications.

The procurement department’s role is to ensure that legally binding commitments are structured so as to serve the interests of the organization in terms of minimizing risk, sharing responsibility, and reducing liabilities.

A liability is a financial obligation, debt, claim, or potential loss.  It is an obligation to pay to another party an amount in money, goods, or services.

In my next submission I will discuss the ‘procurement team.’


Would You Like a Shared Work Station?

From the Editor

Our local newspaper today reports that a large, well-known company that has its US headquarters here will consolidate all employees (+ or – 4,000) to one of its campuses, which is undergoing renovations. In a plan to cut costs, the company will vacate other buildings it currently leases or owns, and have everyone in a single location.

Doesn’t sound like a bad idea, right?

What struck me about this plan is that the renovated building will consist of “work stations.” According to the company spokesperson, there won’t be assigned desks or offices. Instead, “Basically, employees will just come in and choose where they work based on what they need to do,” says the spokesperson.

So, where you sit one day may be different from where you sit the next. Assuming I’m interpreting this plan correctly, I can see where it would create many challenges for a manager. If you have a group that needs to sit close to one another for easier communication and sharing of information, how would you ensure their seats would be in proximity to each other every day? Where would you store your projects’ documents and other artifacts when there’s no permanent file cabinet for you?

There’s also the problem of employee morale. I can’t imagine not being able to have a picture of my kids sitting next to my computer monitor, or the snacks I keep in my drawer for when I get hungry after lunch, or the important documents I have pinned to the walls of my cubicle where I can easily glance at them for certain information.

I may not love working in a cubicle, but at least it’s my own and I can carve out a little space for myself and my identity. I’m not sure I would feel very valued by my employer if every day had a temporary feel to it and I couldn’t establish myself in the physical sense.

What do you think of this idea? As a project manager, how would this arrangement make things better or worse for you and your team?

Concept source


Project Closure: planning the end

Closing a project is, in itself, a project. Everything has to be ‘finalized’ in some way – every deliverable, every expectation. A recent client of mine was not really understanding the closure idea. This person was sure (s)he could just hand the product over to the client, and that was the end. But, you should use a formal process every time!

The end requires a process; a set of procedures that close out all the elements of the project. If there is software for example, there must be some way for the client to acknowledge that the product meets the requirements. So, an acceptance test plan needs to be created.

The closure process also requires a formal meeting that specifies the end is near and establishes a processes to finalize the handover or ‘go live’ of the software. At this point, you also obtain the final authorization signatures that signify the project is closed.

There is still more work to be done, however. In software, you or your team may have to hand over the source code, decouple your team members from the client office systems, hand off the documentation and maybe clean out your desks in some cases. Closure is when some of us get paid…or have to wait if there is some surprise ending.

If the product is not quite right, the testing is not acceptable, the development requires more tear down or there are support or service level agreements to maintain, follow-up must be defined, clarified and finalized with the client signatures. Done is when everyone thinks it is done. Clearly establish all stakeholder expectations for ‘done.’

What comes next depends on long term commitments, if any, and/or new projects waiting to be started. Do not let an old project keep rearing an ugly head because someone does not think it is ‘done;’ get it all finalized and approved, and disconnect as needed. Moving on requires focus on new projects, so don’t let old projects drag you back in. Closure is very important.


Ingredients of Bid Packages

‘Bid packages’ are distributed to potential vendors to solicit responses.  These packages are variously named; tender, bid or proposal packages or documents.

Whatever their name, bid packages must all contain a few vital components if they are to be effective.

Cover Letter
The cover letter provides a brief overview of information that is available to vendors and explains how and when vendors are expected to respond to the request for bids.

The cover letter is only meant to explain what the bid package contains, how to learn more, and how to submit bids or proposals. It is not meant to serve as an elaborate introduction; all details regarding the procurement are contained in the attachments.

The scope of work statement is long and detailed.  This is what the vendor studies in order to learn what is being procured, how and when.  Details provided in the SOW drive price and schedule calculations.

Source Selection Criteria
It is important for bidders to know how their bid will be compared to others and what the buyers consider to be of most importance when evaluating bids (such as low price versus delivery date).

Organization of Response
It is common to provide a detailed explanation of how bids are to be structured (presented). These instructions help vendors know how to submit a bid and what to emphasize.

A consistent bid structure or layout of proposals is very important to the purchasing organization.  Consistency between proposals makes it much easier to compare bids.

Image source


PM or BA? Think ‘Customer Service’

Whether you are a Project Manager or a Business Analyst, you have to think about customer service. You are there to help your customer/organization/stakeholder/etc. solve a problem or complete an endeavor.

You have to think for the customer; sometimes as the customer, sometimes with or for the customer, but always benevolently for the customer or customers.

If you are like me, you are always keeping your finger on the pulse of your team and the project – checking for red flags, looking for trouble brewing, watching for bumps and potholes that might be forthcoming, following the plan laid out and checking off the mileposts as they go by.

Today, I was in a facility where customer service was…how to say this elegantly…substandard. They ignored us!

They got around to us as if we were a bother in their presence. “Oh, darn, another one got through the door.”

Customer service is about the customer. Find out what the need is, and do your best to fulfil it. Don’t leave them out in the dark – talk to them, smile and make them feel welcome. Make them feel like you are there for them. Be cheerful about it, and leave them in no doubt as to your commitment to see them through their presence in your business.

Our society loves self service. We are now scanning our own groceries and lumber. But there are certain service companies that are just not quite “on my side.” They are providing a service with a grudge against me…and I am loathe to use them because of my utter dissatisfaction.

How long would they, if they were a customer, want to wait at the grocery store checkout before they were serviced by some grumpy person who just walks past them a few times before finally acknowledging them. What a surprise that would be if we turned the tide on them!

As a project manager or a business analyst, always think “customer service first,” and be there to meet the customer’s needs.

Have you had a positive or negative experience with customer service?

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