Project Procurement Procedures: Steps, Documents, and Contract Laws

This article discusses project procurement procedures, including steps, documents, and contract laws. It covers the importance of procurement management and contract administration in project management. The article also explains the types of supply contracts and the documents integrated into the procurement process.

Running head: PROJECT PROCUREMENT PROCEDURES
Apply Project Procurement Procedures
Name of the Student:
Name of the University:

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PROJECT PROCUREMENT PROCEDURES
Formative Assessments
Activity 1:
Answer to question 1
For procurement management, the procurement manager should keep the cost in line to
make sure that they meet with customer’s requirements along with expectations with
procurement of the quality products and services. Effective procurement management is required
of people, process and technology. Having right people into procurement such as users, suppliers
and management are required to negotiate contracts and ensure products as well as services to
meet with business specifications. Process is required a minimum of three bids before purchasing
of products. Technology is used for confirmation of purchase requests, specifications of purchase
and selection of vendor.
Answer to question 2
The inputs to the procurement management which establish the project’s procurement
requirements are:
Scope baseline: It acts as reference point throughout the project life cycle and it is
approved version of the scope statement (Nojavan et al. 2015).
Risk register: It is a risk management tool which helps to identify the risks, nature of
risk, impact, probability and mitigation measures.
Project schedule: It reflects on work associated to deliver the project plan on time.

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PROJECT PROCUREMENT PROCEDURES
Cost performance baseline: It is part of project baseline which handles the amount of
money that the project is forecasted to cost (Istrate et al. 2015).
Requirements documentation: It is a document which contains the requirements for
certain products.
Answer to question 3
The delegated project team members collect the information regarding procurement
planning includes of type of products and services required, estimation of cost and project
constraints (Pheng 2018). Therefore, the project team members and procurement manager are
delegated the authority into context of development of procurement management plan.
Answer to question 4
There are ten components which are included into the procurement management plan are:
 Initiation of request
 Development of requirements such as time, quality and constraints
 Request for approval
 Purchasing of authority
 Review of bid
 Responsibility of contract management
 Requirement of contract closure
 Making changes into the procurement documents
 Flowchart for procurement process
 Monitoring of procurement process

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PROJECT PROCUREMENT PROCEDURES
Answer to question 5
Contract is integral part of procurement cycle which assists the contract manager to
manage the contracts by addressing the performance monitoring and helping to make sure that
both contract manager and supplier’s requirements are fulfilled (De Marco 2018). The
procurement contract is termed as document provides details legally-binding agreement among
vendor of products as well as service. Therefore, it is an agreement between two parties which
makes a relationship among them. It also provides of framework of how to deal with each other.
At the time of procurement planning between the organization and supplier, there should
be ensured that the organization should receive of good quality products and services from the
supplier side. The supplier should provide the goods at mentioned time to the organization. The
supplier should also receive of financial benefits based on agreed prices of ordered products and
services. There is consideration that both the parties should agree with offer made by one party
as well as accepted by other. It is included of goods, services and pledge for exchanging the
items. The quality assurance plan is proposed for supplier to monitor their supplier’s
performance. When acceptance of contract, the supplier is intended to profitable by make sure
that it controls the cost.
Activity 2
Answer to question 1
A supplier is a party those can supply of goods as well as services to various
organizations. They add specialized inputs to the deliverables.

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PROJECT PROCUREMENT PROCEDURES
Answer to question 2
The tools and techniques which assist to gather and evaluate information on suppliers are
shipping status tool which provide timely information on shipping of products and services,
order processing tools help to gather information on when the customers should receive delivery
of products (Birou, Lutz and Zsidisin 2016).
Answer to question 3
The organization can manage procurement decisions related to selection of supplier are
measuring the supplier performance, gaining the feedback from supplier, developing the strategic
partnership and ensuring of quality for the customers. While selecting the supplier, the
organization should include the key stakeholders in process to agree on significant criteria the
supplier meets, requires of good communicational skills and perform audits on selected supplier
(Mena, Christopher and Van Hoek 2014).
Answer to question 4
The methods used to select right supplier are:
1. Weighted point method is used technique for evaluation of right supplier based on
scoring to each supplier performance and the score is then multiplied by assigned weight
for each factors.
2. Dimensional analysis method helps to resolve the drawbacks of the approaches. This
method is combined of various criteria for various dimensions which is relative to
importance into single entity for each of the suppliers (Whitaker 2016).

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PROJECT PROCUREMENT PROCEDURES
Answer to question 5
The other terms which are meant to contract are agreement, bond and settlement.
Agreement is negotiated and legally binding arrangement among the parties as course of actions.
There is contract agreement which consists of policies as well as procedures for the organization.
The bond is fixed income statement where the investor loans money to the entity which borrows
of fund for defined period at variable and fixed interest rate. Settlement is official agreement that
is intended to resolve the disputes as well as conflicts.
Answer to question 6
Terms and conditions have great impact on the contract. At the time of negotiating a
contract terms, it makes sure that conditions of contract are defined as well as agreed to by the
parties (Pheng 2018). The business terms and conditions set contract foundation among the
customers and suppliers. The importance of term and conditions are understood by explanation
of contract. When the contract is put into written form, then statement is to be term of contract.
The general rule is party is bound by the terms out into the contractual document once it is
signed it. It is applied whether it read terms as well as understood them all.
Answer to question 7
Probity is termed as quality to have stronger moral principles as well as honesty. There
should be strict adherence to the code of ethics based on honesty. It is related to the project
management as higher level of probity throughout the financing phase of project can structure to
continue during the project (De Araújo et al. 2017).

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PROJECT PROCUREMENT PROCEDURES
Answer to question 8
There are two documents that can be developed for contracted supply of goods or
services such as contract negotiations minutes and bidding document.
Answer to question 9
The cost plus and fixed price contracts are types of construction contracts. The cost plus
contract is price of construction (cost+ additional fee) designated as the profit. The fixed cost
contract is the cost of materials as well as labor wit indirect cost.
Activity 3
Answer to question 1
XYZ Com PO #
123 High Street Date: 30th April, 2018
Adelaide 5000 Date Req: 9th May 2018
Order by: XYZ
Delivery:
123 High Street
Adelaide 5000
Deliveries accepted between 8:30 am and 4:30 pm only.
Delivery to rear entrance via door 3.
Vendor:

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PROJECT PROCUREMENT PROCEDURES
Network Suppliers of 123 High Street
Qty Item Description unit extension
100 metres Cat 5 cable Item number 00001 $ 1.75 per metre $ 175
100 connectors Item RJ45 $ 1.98 $ 198
Subtotal $ 373
GST 37.30
Total $ 410.30
Answer to question 2
There are two of discrepancies into the ordered and received goods such as:
1. There are ordering of 100 connectors, but there is supply of 50. While goods received is
showing that there are three separate boxes of Rj45 connectors are provided with 25 each.
2. There are ordering of 100 quantity of Cat 5 cable of 100 meters, but the box is not
showing the total quantity of cable which are received.
Answer to question 3
The activities which are included into the procurement of project are:
 Selection of proper relationships as well as contract approaches for type of purchased
goods and outsourcing of services
 Preparation of request for proposal and evaluation of partnership opportunities
 Evaluating the request for proposal and partnership

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PROJECT PROCUREMENT PROCEDURES
 Award and sign the contracts
 Management of quality and timely project performance
 Managing the contract changes
 Selection of proper supplier for the delivery of products and services
 Estimate the delivery time and procurement cost
 Agreement on goods and services
 Closing the contract
Answer to question 4
The information related to procurement is kept and maintained by use of file management
plan where the documents related to pre-tendering, tendering contract are kept. The procuring
entity is maintaining the procurement as well as contract records of procurement requirements
(Fuller et al. 2017). The entity develops the filing system which maintains record on each of
procurement.
Answer to question 5
The organization can receive, reconcile as well as register of suppliers to ensure that
ordered goods are matched with agreed prices as well as specifications. The organization takes
possession of the products to stage them for inspecting, placing them on inventory as well as
deployed them to the end users. The received goods by the organization is matched with the
supplier invoice and received goods are those which are ordered. When there is arrival of vendor
invoice, then it is compared with the packaging slip. None of the orders are issued until the
financial provision for expenditure is met with proper budget (Schwalbe 2015). The received
goods as well as products are inspected against the technical specifications. The orders are in
form approved by the Head of Finance and it is signed by the authorized employees.

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PROJECT PROCUREMENT PROCEDURES
Answer to question 6
Contract administration is termed as management of the contracts that are made with the
customers, partners, employees as well as vendors. They are involved with planning and
developing the contracts. They are included means by which to measure performance of parties
for determining if they are meeting with obligations as well as procedures for monitoring
performance of the parties. Therefore, the contract administration makes seller to meet with
obligations. When the seller is not fulfilled contractual requirements, then the legal remedies are
pursued. The main function of contract administration is managing of interfaces between the
service providers. When the company is prepared for bidding, then the contract administration is
not sending request for proposal to the potential vendors.
Answer to question 7
The documents which are required to be retained for audit or reporting purposes are
receipts of purchase of products, cancelled checks, copies of tax returns, records on stock and
assets.
Activity 4
Answer to question 1
The purpose of contract closeout process is to meet with the terms of contract and
completion of administrative actions, all the disputes are being settled and the final payment is
done (Kerzner and Kerzner 2017). It includes of administrative actions which are required such
as property, royalties as well as security.
Answer to question 2
The objective of a procurement audit in finalizing the project’s activities are:

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PROJECT PROCUREMENT PROCEDURES
 To oversight of the contractual activities
 To process solicit bods and award contracts
 To manage of contracts as per agreed terms and conditions
 To manage of procurement process and supply of goods and services
Answer to question 3
The procurement officer is responsible for deciding a procurement contract has been
completed. The officer ensures that the organization should make wise purchase for the goods as
well as services to resell (Fuller et al. 2017). The demand for both product as well as services is
increased.
Answer to question 4
The process assets might be updated as a result of a review into the effectiveness of the
procurement process such as to manage procurement relationships, monitoring of contract
performance as well as make changes into the procurement documents. The lessons learned
register are to be updated with the techniques that are required to maintain the scope, cost as well
as schedule for the procured items (Heagney 2016). The schedule is required to update as well as
approve in order to reflect on expectations.
Summative Assessment 1
Answer to question 1
Steps followed during contract and procurement management are:
 Specification: It involves of purchasing department to communicate with the project
management for development of procurement items

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PROJECT PROCUREMENT PROCEDURES
 Selection: It is required to find the suppliers those are procured the items.
 Contract: The procurement department should communicate with the suppliers for on
delivery of the items.
 Control: The procurement management is successes based on purchasing department for
controlling delivery as well as payment processes.
 Conduct meetings: Meetings are done with the vendors for tracking the delivery process
and review the ordered items (Hornstein 2015).
 Measurement: Performance indicators is used to measure assess of success into the entire
procurement process.
Answer to question 2
Documents integrate as part of procurement process is:’
 Request for proposal
 Request for information
 Request for quotation
 Contracts
 Solicitations
Answer to question 3
Contract laws are applied to the contract obligations as it recognizes as well as governs
rights as well as duties raised from the agreements. The contract laws are branch of law of the
obligations (Heldman 2018).
Answer to question 4
There are three types of supply contracts such as:

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PROJECT PROCUREMENT PROCEDURES
 Fixed price contracts: It is used when there is no uncertainty into the scope of work.
Once the contract is being signed, the seller is bound to complete task into agreed amount
of time as well as money.
 Cost reimbursable contracts: The seller is being reimbursed to complete work with
representing the profit. The fee is paid if the seller will meet as well as exceed the project
objectives to complete work with less cost (Lloyd-Walker and Walker 2015).
 Time and material contracts: It is used when deliverable is labor hours. The project
manager provides needed qualifications responsible for providing the staffs.
Answer to question 5
No, price is not the only criteria to evaluate and select the supplier; total ownership cost
is one of the important factors. It includes of unit price of materials, payment terms, order cost,
carrying cost and logistics cost.
Answer to question 6
Weighting system is used as project procurement management tool for acquisition of
goods as well as services from performing the organization to gain of maximum benefits to the
organization. The system ensures to award best seller related to contract. Most of the system is
involved to assign of numerical weight to each of evaluation criteria, rate seller based on each
criterion, multiply weight by rating as well as totaling of resultant products for compute of total
score. The weighting system is used to select single source those are asked to sign of standard
contract and rank order the proposals for establishment of negotiating sequence. It ensures that
best seller is being awarded for the contract, assigned values of proposal and each of them is
being scored. The seller has highest score being awarded the contract.

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Summative Assessment 2
Project 1
Project name: Design and development of a program to train authorized officers, or ticket
inspectors on a metropolitan public transport system
Prepared by: Procurement Manager
Date: 25th April 2018
Make or Buy decision
1. Developing a curriculum for 420 hours course
2. Production of teaching and supporting materials for 14 units of competency
3. Development of range of assessment tools
4. Development of strategy for facilitating course evaluation, review and maintenance
Statement of Work
There is development of curriculum, teaching materials, assessment tools and a maintenance
strategy for an authorized officers training program.
Required contractual provisions
The appointment is considered initially for a time frame of 3 months. The total duration of

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the project is 18 months with a budget of $240,000.
Schedule of events: 18 months
Event: Date:
Prepare course proposal 2nd April 2018
Document agreed objectives and deliverables 15th April 2018
Finalise timelines and work plans 23rd May 2018
Develop scope management plan 28th July 2018
Establish administrative systems 6th September 2018
Confirm and brief project team 24th November 2018
Set up project steering committee 4th February 2019
Convene first meeting to sign off content clusters and learning
sequences
14th March 2019
PSG to review WBS, finalise and sign off 1st October 2019

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Evaluation criteria
1. Understanding of the tasks/ appropriateness of the proposed approach/ methodology
2. Demonstrated expert knowledge and skills in training program development
3. Relevant experience of the contractor in training program development
4. Extensive national and international knowledge of best practices in the training
development field
5. Fee rates and estimated total cost for each stage plus overall costs for the project
Potential Suppliers
Oracle Supplier Diversity Program
Approval
Name: Please insert the name
Title: Please insert
Signature: Please insert
Date: Please insert the date

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PROJECT PROCUREMENT PROCEDURES
Answer to question 1
The stakeholders consist of following interest and expectations to a project such as:
Support: They are contributed to success of the project throughout assuring a reliable
supply of products and services as per customer’s requirements. They are providing
governmental support for the project (Kerzner and Kerzner 2017).
Knowledge: They are focused on development of new knowledge related to the
governance frameworks.
Work: They are involving the organizational workers into decision making which
enhance the work life as well as make people more satisfied with the jobs.
Time: They are interested to follow flexible working hours which increase the
productivity of organization.
Economics: The employment training program helps them to improve the economic
prospects for the lower income people (Walker 2015).
Answer to question 2
The interest of the stakeholders is included into the project management process through
use of stakeholder power interest matrix, where the interests as well as respective power of
stakeholders are involved into the matrix to identify their importance into the project.
Answer to question 3
The stakeholder’s interests are to be managed by some of the strategies such as:
1. Stakeholder mapping

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PROJECT PROCUREMENT PROCEDURES
2. Understanding levels of its influence
3. Identification of stakeholder triggers
4. Development of mitigation plan
Answer to question 4
The action which is required to support the groups from influence chart should be a
proper timetable to complete the project activities on time and set of proper steps to help for
reaching the objective (Joslin and Müller 2015). At first when determine the actions, the
considerations are to estimate the project budget and timeline.
Answer to question 5
The interpersonal skills necessary when dealing with stakeholders are as follows:
 Leadership
 Building of project team
 Motivation of the stakeholders
 Communication
 Decision making
 Negotiation
 Building of trust
 Conflict management
 Training

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 Influencing
Answer to question 6
Before the stakeholder’s engagement as well as influence, it is seek to understand people
those are working and relying throughout the project phases. Communication helps the
stakeholders to share of important information to each other (Leach 2014). Training is required
to teach those stakeholders who have lack of knowledge to work into the project.
Answer to question 7
Conflict management is raised when the individuals have various opinions and processes
are not willing to compromise with each others. The conflict is lead to negatively affect the
project success.
Answer to question 8
Five characteristics of SMART goals are:
 Specific and well defined
 Measurable into nature
 Achievable as well as realistic
 Relevant on the job
 Time for the success
Answer to question 9
The strategies used when distributing project work roles among team members are based
on project priority, the stakeholders are allocated the project activities as per their skills as well

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PROJECT PROCUREMENT PROCEDURES
as knowledge as per project requirements (Binder 2016). The consideration which is required to
allocate work is person’s availability. Based on interest of the stakeholders into the project work,
the works are allocated to the project team members.
Answer to question 10
The role into the project is established by providing team time to develop, allowing the
team to know each others, taking of time to clarify the goals of project and defining the roles and
responsibilities of other team members.
Answer to question 11
The project management teams have behavioural expectations and the project manager
helps to ensure that they can meet with the boundaries of project scope, schedule, budget as well
as quality (Muller 2017). People behaviour is one of the key factors for driving successful project
management.
Answer to question 12
The expected behaviours of project teams are:
 Treat with dignity as well as respect
 Support the inter and intra departmental team members
 Demonstrate to solve of problems and take of timely decisions
Answer to question 13
Diversity is referred to variety of differences among the individuals of the organization. It
includes of how the individuals are identified themselves and how other are perceived of them. It
is into the workplace is encompassed of race, gender, age, status of citizenship as well as

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PROJECT PROCUREMENT PROCEDURES
religion. The organization faces diversity by making concerted efforts for encouraging the
heterogeneous environment throughout promotion of the culture of tolerance.
Answer to question 14
Performance review is such a method where the job performance of the employee is
being documented as well as evaluated.
Answer to question 15
A performance review is implemented to make the employee redundant. It is also
implemented when it benefits the employee by allowing them to provide extra benefits and
incentives to improve their working conditions (Muller 2017).
Answer to question 16
The strategies used to, motivate the underperforming team are:
 Provide clear feedback about their performance into the team
 Listening to the point of contention of their underperformed team members
 Creating performance goals for each employees
Answer to question 17
Feedback is important as it is the process where each part of output is returned to the
input for regulating the further output. It is required for educational purposes, training as well as
personal development (Kerzner and Kerzner 2017). It is important as it provides guidance to
others for performing better.

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PROJECT PROCUREMENT PROCEDURES
Answer to question 18
The benefits of learning or development are increasing of job satisfaction as well as
morale among the employees. It also increases employee motivation and results into financial
gain.
Answer to question 19
Methods used to provide learning and development opportunities are:
 Written description of the job requirements which details their duties, skills and
knowledge of individual
 Competency standards which outline both skills and knowledge required to carry out
particular tasks (Muller 2017).
 Review of individual performance of employees
Answer to question 20
Individual development requirements are documented based on competency, skills as
well as abilities required to learn and develop more in their current working performance. It is a
tool which can organize as well as target the professional along with personal development.
Answer to question 21
Effective communication is required into project management for following reasons such
as:
 Both the stakeholders and team should inform about what they are expected of them
 Receiving of important information
 Changing into the situation into the project work

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PROJECT PROCUREMENT PROCEDURES
Answer to question 22
Role of following into stakeholder engagement such as:
a. Inform: For those whom changes may provide minimal impact, they are
aware that something is happening. It makes effort to inform them before
it makes changes.
b. Consult: For those where there are huge changes, there is requirement of
consult about the matter with the higher management team for taking
proper decisions.
c. Involve: For those who are closer to changes, it is better to invite them for
participation (Kerzner and Kerzner 2017). They are involved to find the
solutions to agree upon the problems.
d. Collaboration: For those who are into changes can integrate of
collaboration with the stakeholders to make the changes as possible.
Answer to question 23
Communicational tolls available to the project management team are:
 Project board
 Discussion board
 Email for one-to-one conservation
 Weekly status report
 Daily standup meeting

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PROJECT PROCUREMENT PROCEDURES
Answer to question 24
Communication plan is considered as policy driven approach to provide the stakeholders
with the information. The plan is defined to provide specific information which is delivered to
the stakeholders through use of communication channels.
Answer to question 25
The stakeholders should require engaging with the project management teams to be
informed about status of the project, its progress as per scheduled time and require to know about
the project information.
Answer to question 26
Five steps require creating stakeholder relationships are as follows:
 Defining the role of the stakeholders in the project’
 Brainstorming the stakeholders as per their role into the project
 Prioritizing the list of stakeholders
 Documenting learning’s and sharing it back
 Monitoring and refining the project strategies
Answer to question 27
Standard forms such as cost-reimbursable contracts can integrate on the project
communication to coordinate with other agreements which are used into the project (Kerzner and
Kerzner 2017). The agreements are required for good documentation of costs which are occurred
into the project for ensuring that the contractor is getting paid for their performance.

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PROJECT PROCUREMENT PROCEDURES
Answer to question 28
Variance is a measurable changes form the standard as well as baseline. It is termed as
what is difference between what is being expected and accomplished.
Answer to question 29
The escalation is determined which level of the upper management into the contract is
based on degree of variance from the project (Pheng 2018). It is communicated with the
stakeholders by conducting a meeting to discuss the issues.

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