IT Procurement and Vendor Management

Running head: IT PROCUREMENT AND VENDOR MANAGEMENT
IT Procurement and Vendor Management
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1IT PROCUREMENT AND VENDOR MANAGEMENT
4 processes of 'Project Procurement Management
In order to establish and maintain effective relationship with vendors the Project
Procurement Management cycle with its 4 basic steps are very beneficial for any
business organisation. The four conjugative parts of Project Procurement Management
is The Planning Process, The selection Process, The Administration Process and The
Closing Process (Khanam et al. 2015).
In planning process, the core business organisation can develop initial planning
including risk identification and timeline for the procurement management. The planning
process has huge impact on the potential time and cost efficiency of the procurement
process. It highly influences the selection process of the procurement management. It
helps to identify the financial and budget scope of the project. The selection process
refers the comparing and selection process of the most suitable vendors considering the
optional advantages as well as disadvantages. The selection process also includes the
financial and operational negotiation process. Administration process allows the core
company to develop the centralized system while executing the planned procurement
project. Many operational tools like physical inspection, internal audits and reviews are
used in this phase of project management. The closing process refers the
documentation process just before the process of closing the executed operation with
expired business contract. Resolving disputes with internal negotiation is highly
important.
4 components of an 'enforceable contract';
Enforceable contract has four major components that allow to abide by the contract’s
terms and condition while having and recognised identity from courts where the court is
able to compel compliance. These four major parts for enforceable contract are Offer,
Acceptance, Mutual agreement and Consideration.
Offer is an initial phase of acts in an enforceable contract, which is made in exchange
for a return promise. The field and presentation of an offer must me legitimate while
prioritising the requirement of the business partner. Offering is the initial phase of the
contract that present the agreement issue to the other organisation (Ico.org.uk 2018). In
Acceptance, process both of the parities must be consternated about the validation of
the agreement. Acceptance initiates the further procedures of a contract. The process of
acceptance requires the authentic documentation from both parties that can clearly
testify the acceptance. Mutual agreement is the most essential phase of an enforceable
contract that required legitimist and adequate. For that both of the organisation have to
measure the possible consequences of this contract before signing the mutual
agreement. In consideration phase the duties and responsibilities of both organisation
are forecasted with regulatory policies, procedures, terms and condition under the
sincere supervision of the court.

2IT PROCUREMENT AND VENDOR MANAGEMENT
3 necessary components of an offer;
A acceptable offer for a contract needs to have three necessary components that
validate the specification, realistic and achievable aspect of the offer. The relevancy of
the whole contract depends on these components of the offer namely Communicated,
Committed and Definite terms.
The party making the offer must communicate with the all stakeholders who could be
associated with the contract and the regulatory operation. In these participants the most
essential participants is the offeee, in other words the party for whom the offer has been
made. An appropriate communication can build the foundation of the overall contract.
During the offering both of the parties must ensure that the other one is committed
enough to the contract while keeping the rules, regulation, conditions in mind. A
committed offer can ensure the flawless enforcement and execution of the project
(iwillteachyoutoberich.com 2018). In any project management plan commitment is the
most essential factor that also has a huge impact even before the contract being made.
The offer must be definite and specific about their field operation and purpose of
initiation. The essential terms involving price, timings, manner of acceptance have to be
well defined in the offering phase of the contract.
The difference between independent and dependent demand;
The demand can influence the external factors like consumer relation, partnership and
internal factors like financial factors workforce management, production and policies
from low to high level of intervention. In accordance with this variable impact the
demands are divided into two types namely dependent demand and independent
demand.
Independent demands influences the internal factors like finance and revenue as well
as the external factors like supply chain management to some extent where the
influences are very low. However, for Dependent demand both internal and external
factors are influence by higher amplitude. Measuring the independent demand is much
easier than the dependent demand because of its less complex cardinality with the
other internal and external regulators. When it comes to the dependent demand, both
substitutes and complements of the offering products are considered. In contrast, for
independent demand either substitutes or complements are considered for
measurement (Cgi.com 2018). The changes of these regulatory factors cannot influence
the independent demand to considerable amount. However, these factors have high
impacts in the dependent demand. Therefore, independent is significantly vulnerable
than the dependent demand.
The hidden costs of outsourcing;
The outsourcing policy are utilised to minimise the operational cost as well as time.
However, some operational costs can have strong impact on the overall expenditure of
the business. Measuring the hidden costs of undertaken outsourcing policy is chief
essential financial factors that formulate the potential profitability.