Project Risk and Procurement Management

This paper discusses Telstra's procurement management, including strategic outsourcing, procurement cycle principles, and literature review. It also provides recommendations for improving procurement management. The paper emphasizes the importance of transparency, integrity, and openness in procurement processes.

PROJECT RISK AND PROCUREMENT MANAGEMENT
Project Risk and Procurement Management
Name of the Student
Name of the University
Author Note

1PROJECT RISK AND PROCUREMENT MANAGEMENT
Executive Summary
The prime determination of this paper will be on the risks associated with the Telstra and its
procurement management. This paper will be staring with a detailed introduction of the
selected business organization which is Telstra. The paper will be discussing the strategic
outsourcing of a business organization. The different types of parameters associated with the
procurement of this organization will be discussed in the paper in a descriptive way. The
paper will also be focussing on the application of the Procurement Cycle Principles in the
working environment of Telstra. The other purpose of this paper is to focus on the success
rate of the theories. The procurement management of this business organization will be stated
in this paper to understand the different aspects which are considered while developing the
procurement. The Literature Review unit of the paper will help the readers of this document
to understand the different opinions of the authors about the procurement strategies of Telstra
and similar business organizations. The paper will be concluding with a strong
recommendation portion considering the procurement management of Telstra.

2PROJECT RISK AND PROCUREMENT MANAGEMENT
Table of Contents
Executive Summary...................................................................................................................1
Introduction................................................................................................................................3
Critical Examination of strategic outsourcing............................................................................4
Success rate of the application of the Procurement Cycle principles in Telstra........................8
Literature Review.....................................................................................................................13
Conclusion................................................................................................................................14
Reference..................................................................................................................................16

3PROJECT RISK AND PROCUREMENT MANAGEMENT
Introduction
The foremost determination of this unit of the paper is to focus on the background of
the chosen organization Telstra and risks associated with the project and the procurement
management.
Largest telecommunication industry in Australia, Telstra operates and builds around
different types of telecommunication networks and market voices. The mobile networks and
the internet access and pay television are the other type of product and services provided by
this telecommunication organization. Started as a public service organization this tele
communication organization is now a private service organization. This business organization
is going through lots of changes as the market value of the organization is fluctuating very
much in recent years. Pay TV and data cable network are the other types of service known as
Foxtel are provided by this organization. The privatization of this telecommunication
organization was in three stages such as T1, T2 and T3 (Telstra.com.au 2018). The
government of Australia owns about 51% of the total share of this organization which was
later sold to the Future Fund of Australia which provides pension schemes for the public
servants of Australia. The entire national broadband network of Australian is mostly managed
by this telecommunication industry.
The management team of this organization is very much efficient in their operational
strategies. The introduction of Telstra digital is one of the most significant step for this
business organization, it was helpful in improving the use of the digital channels for the
clients of this business organization. The optimized application of Telstra is very much new
to the consumers, the stakeholders of this business organization use Facebook applications to
manage their Telstra accounts. Different types of payment gateways are integrated with the
working condition of the Telstra such as PayPal. In the year 2016, Telstra is the most

4PROJECT RISK AND PROCUREMENT MANAGEMENT
valuable brand in Australia. This business organization sponsors many international sports
events such as National Rugby League premiership and the Formula 1 races.
This paper will be focusing on the activities of this organization such as the
purchasing power, quality control measures, transportation, incoming inspection and
outsourced process. The ever changing business conditions are the main reasons behind the
need of constantly improving the source process of this organization (Zuiderwijk et al. 2014).
This business organization updates its operations strategies according to the needs and
requirements of all the stakeholders associated with the organization. The other need for
updating the policies is the competitive advantage considering the rival telecommunication
organizations.
Critical Examination of strategic outsourcing
This unit of the paper will be focussing on the strategic sourcing cycle of selected
organization. Telstra has a very impressive commodity use forecasting planning measure.
The strategic sourcing of this telecommunication industry also includes the market analysis
which is very important for the aspect of this telecommunication industry. This business
organization evaluates the role of its suppliers to find the effectiveness of their services.
Implementations of the different types of contracts are other aspects of strategic sourcing of
this business organization (Hughes, Morrison and Ruwanpura 2018). The management of the
different modules of this industry such as the supplier are managed with the help of the
strategic out sourcing.
This telecommunication industry maintains very good relationship with all the
stakeholders associated to this organization as they always want to expand the business reach
of this organization. The standard of behaviour is always set by this organization. The labour
and the human rights are always focussed in this organization. Along with that, this business

5PROJECT RISK AND PROCUREMENT MANAGEMENT
organization deals with health and safety measures of all its employees. The business
integrity is a very important criterion of the operational strategies of this business
organization. The privacy and the supplier diversity are the other characteristics feature of
this business organization. This business organizations deals with the e-sustainability
initiative which is the most important characteristic feature of sustainable procurement of this
business organization (Raganelli and Mauro 2016). The other essential aspect of the
sustainable procurement of Telstra is the partnership with the other type of tele-
communication organizations of Australia by the name of Joint Audit Cooperation. This
association helps this organization in developing the corporate social responsibility in the ICT
industry. Confidentiality is maintained in the working environment of Telstra with the help of
the exotic sustainable procurement.
The organizations need and requirements are successfully meet with the help of this
approach. Human value as well as the values of the assets of this organization is successfully
managed with the help of these discussed parameters of the strategic sourcing.
It can be also said that the different aspects of the strategic sourcing can bring
different types of issues and challenges associated to this business. Inefficient market analyse
could lead to heavy business loss for this business organization (Muange and Chirchir 2016).
The incorrect evaluation of the suppliers can be a huge source of concern considering the
growth of this organization. The employment contracts should be properly explained so that
clarity is maintained in the business process.
On the other hand, it can be said that the existing procurement strategy adopted by
this organization is vulnerable to market conditions. All the telecommunication industries of
the world are finding it difficult to cope up with the risks associated with these industries.
The operational strategies adopted by this business organization is successful to a significant

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extent, however, plenty of changes in those strategies could have been better for this
company. The business partners or the subsidiary organization of this organization should
have been awarded with bonus schemes in their joint ventures. The human rights of this
organization should be regularly checked as the needs of the stakeholders of this business
organization are changes with time (Ghadge et al. 2018). The labour of this organization
should be aware of the mission and visions of the company instead of imposing any harsh
regulations on them. The method by which the business integrity is maintained in this
organization should be very much flexible as the employees always wanted to work more
freely according to their wish. The method by which privacy and integrity is maintained in
this organization can be replaced in a more effective way by the implementation of the IT
based ERP systems. The challenges and the issues associated with the business organization
can be very much minimized with the help of these proposed strategies.
The resources and business processes associated with this industry are maintained
with the help of the effective procurement strategies, which considers every single entity
associated with this telecommunication industry. The organization have their branches
throughout Australia which are managed their respective operational heads are based on the
procurement strategies of this organization. The back office leads and the transactions leads
are effectively handled with the help of a secured and efficient payment gateway which fulfils
procurement strategies.

7PROJECT RISK AND PROCUREMENT MANAGEMENT
.
Figure 1: Risk and Compliance Management of Telstra
(Source: Created by the author)
IT Industrial Telecom Consumer
Discretionary Energy Healthacare
0
1
2
3
4
5
6
7
8
9
Industry Sectors affected by Telstra
CAO CEO Business CIO
Figure 2: Impact of Telstra on the other countries of Australia
(Source: Created by the author)
Enterprise Focus
The third party expenditures are reviewed
by the ERP management system which is
Customer Proximity
The customer proximity unit of the
procurement helps this business
Strategy sourcing
cycle
Transition
Category
Negotiation
and contract
Selection of
the suppliers
Devrelopment
of the sourcing
strategy
Profile
Product/
Strategies
Redefine
Requirement/
Spevcifications
Strategy sourcing
cycle
Transition
Category
Create
Requisition
Selection of
the suppliers
Devrelopment
of the sourcing
strategy
Profile
Product/
Strategies
Redefine
Requirement/
Spevcifications
Contract
Management
Procurement Intelligence

8PROJECT RISK AND PROCUREMENT MANAGEMENT
based on the procurement report of the
organization. The different departments are
analyzed with the help of the sustainable
procurement strategies (Bryson 2017). The
buy in from the field is the other strategies
of the optimal procurement report.
Harmonization of the processes across the
enterprise is maintained with the help of
their procurement report.
organization to deal with their internal
customers. The business processes can be
improved with the help of the strategic
planning.
Table 1: Two most important aspect of strategic sourcing
(Source: Created by the author)
All the discussed contribution will be helping Telstra to have a competitive advantage
over the other telecommunication industries of Australia. The complexities associated with
the telecommunication industries can be solved purposefully with the help of the discussed
aspects of the strategic sourcing (Bateman, Hines and Davidson 2014). The importance of
strategic sourcing can be understood with this section of the paper.
Success rate of the application of the Procurement Cycle principles in
Telstra
The prime focus of this unit of the assignment is to focus on the successful
implementation of the procurement cycle principles in the selected organization Telstra. The
procurement cycle principle is defined as the circular process consisting of key steps; it is
very much important for business organizations such as Telstra to follow this procurement
cycle principle when procuring goods and services (Ishak and Said 2015). The integrity of the
entire business process can be effectively maintained with the help of these procurement

9PROJECT RISK AND PROCUREMENT MANAGEMENT
cycle principles (Harrison and Lock 2017). The procurement cycle principles are directly
related to the governmental legislations and complexities such as the taxation and the other
government regulations associated with the business organization can be solved purposefully
with the help of these procurement cycle principles.
Figure 3: Five Principles of Procurement
(Source: Created by the author)
Transparency: It is one of the most important principles followed in the procurement
processes of most of the public business organizations (Waddell 2017). According to this
procurement cycle principle, all the stakeholders associated to the business organization such
as the service providers, suppliers and the contractors must have the access to every
information associated to the business and industry unless there are valid reasons such as the
confidential information such as the future marketing strategies, as leaking of these
information may lead to the loss of the corporation.
IntegrityTransparency
Opennes s Fairness
AccountabilityCompetition

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Telstra is very much sincere about their transparency considering their circulation of
information among their stakeholders. The organization categories the confidential
information with the general information and release the general information’s of the Telstra
accounts of their employees (Sonnekus 2014). This business organization have stringent
regulations related to the circulation of information as any kinds of violation in terms of
information outside the business organization may have a direct negative impact on the
concerned stakeholder.
Integrity: Integrity or reliability is one of the other vital aspects of the public business
organization. According to this procurement cycle principle, the information which is sent by
a procuring entity of a business organization should be very much reliable (Lozano et al.
2016). This principle helps in restoring confidence in any business cycle which is expanded
to many complicated business situations. The information must be very much dependable and
free of the ambiguity factors.
The selected organization Telstra ensures that integrity is successfully maintained in
their working environment but there are few instances which were found that the information
associated to the external stakeholders such as the suppliers of the raw materials used in this
business organization were found to be compromising some of the data to the other
telecommunication corporations which they are giving service to (Agarchand and Laishram
2017). Thus it can be said that Telstra is partially successful in maintaining integrity in their
procurement process.
Openness: This is very significant aspect among the procurement cycle principles, it
states about the openness of all the requirements of the business procurement among all the a
qualified personnel’s of a business organization (Chen 2015). General public not should be
having access to the confidential files of the business process. Approval of the authority is a

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must to forward the information from one entity to other within or outside the business
organization. Except for the proprietary information, every other type of information should
be circulated within the stakeholders of a business organization.
The selected business organization is very much successful in implementing the
Openness principle in their business environment as they have a very secure platform which
is used to pass their information from one desk to another and this passage is not possible if
the data is not authenticated by a middleman who checks the authenticity of the data (Tate
2014). All the business activities in this business organization, considering the procurement
processes are managed with the help of this middle man who helps in improving the success
rate f this organization by maintaining this procurement principle.
Fairness: It is one of the vital aspects of procurement cycle principles. According to this
principle all the internal and the external stakeholders associated to a business organization
should be treated equally to bring out the best from them. This leads to better decision
making among the internal stakeholders. This principle may be also defined as the way by
which compliance is maintained in a system. Right to challenge the procurement process in a
business organization is one of the other approaches of this procurement principle.
The selected telecommunication corporation is partially successful in maintaining
openness in their working environment (Haugbølle, Pihl and Gottlieb 2015). It can be said
that this organization treats their employees according to their designations, however it can be
also said that this business organization provides a separate communication portal to all of
their stakeholders to register any of their complaints against the existing business processes.
Competition: It is one of the most significant aspects among all the other kinds of
procurement cycle principles. According to this principle every stakeholder associated to
public business organization should not be manipulated under any circumstances for the

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benefit of the organization or individual benefits also (Hauschildt①a and Schulze-Ehlersb
2014). This principle also states that the importance of the market response should be
considered while implementing any of the procurement principles. According to this principle
the practise of the non-competitive procurement methods should be minimized in order to
have a negative impact on the business processes.
Being the largest telecommunication industry in Australia it can be said that Telstra is
very much successful in maintaining this principle in its working environment. Non-
competitive procurement methods are not at all considered as an option in this business
organization, instead of that this organization relies heavily on the sole sourcing (Kristensen
et al. 2015). This organization understands the impact of the Non-competitive procurement
methods so they always prefer the market response while implementing any of their business
strategies.
Accountability: According to this procurement cycle principle, it can be said that
every internal and external stakeholders associated to this business organization is
responsible for their decision or action regarding any of the important decisions. Any kinds of
obligations will not be tolerated at any cost considering the violation of this procurement
principle.
This business organization has numerous issues associated with accountability
especially in the remote areas of Australia where they provide services. The data cabling
service of this business organization is the most affected modules of this business
organization considering these criteria (Pooe, Mafini and Makhubele 2015). So, it can be said
that this telecommunication corporation should be improving their accountability problem to
achieve a more competitive advantage than the rival telecommunication countries of
Australia.

13PROJECT RISK AND PROCUREMENT MANAGEMENT
Procurement Cycle Principles Success rate in Telstra
Transparency Successful
Openness Successful
Integrity Successful
Fairness Partially Successful
Competition Successful
Accountability Not successful
Table 2: Success rate of procurement cycle principles in Telstra
(Source: Created by the author)
Literature Review
As discussed by Ozguler (2016), the increasing globalization is having both positive
and negative effect on the growth and development of the telecommunication industries
around the world. There is an increasing need for maintaining effective procurement
management team to deal with all the possible risks associated with the projects. The author
this resource highlighted about the importance of the procurement management and also
stated about the application of knowledge, skills, tools and techniques in the implementation
of the procurement in a public business organization (McCue, Prier and Swanson 2015). The
main drawback of this paper is that it is written in a generalized format which is not very
much reliable and the advantage of this paper is that it discusses the different procurement
principles in a detailed manner.
However, according to Handfield, Primo and Oliveira (2015), relationship
management among the stakeholders of telecommunication industries is the only way which
can make them handle complicated risks associated with the projects in this industry. The
authors of this resource focussed on the importance of the relationship management which

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can be a critical factor considering the success process of the telecommunication industries.
The author of this resource stated that most of the telecommunication industry has similar
types of issues such as the issues coming the client’s side which is a bit incorrect. The writer
did not mention the name of any global organization that can follow their methodology to
achieve competitive advantage (Byrne and Mo 2015). The prime advantage of this paper is
that it focuses on risk mitigating step rather than writing different processes in an
unstructured manner. However, the most significant limitation of this paper is that it does not
justify writers proposed methodology with the help of any telecommunication industry which
has applied their methodology and achieved success in it.
It can be understood that both the authors had their personal opinion about the
methods and technique by which the risks associated with this industry can be solved
purposefully. But the implementation of the effective procurement management is more
effective than only concentrating on the relationship management of the stakeholders as there
are lots of other issues which needs more than just management such as the monitoring the
performance of the marketing team which cannot be managed with the help of the
relationship management.
Conclusion
From the above paper, it can be concluded that the procurement process is very much
important for every businesses organization in accomplishing their mission and vision for the
organization. All the essential activities in global organizations such as Telstra can be
managed and all the possible risks associated with the organization can be improved with the
help of the procurement processes. In order to face the complicated business environment or
achieve competitive advantage procurement processes play a key role. The importance of the
strategic sourcing is also mentioned in this paper with prime importance along with the

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importance of contract management between the internal and external stakeholders of Telstra.
The literature review unit of the paper helps in understanding the opinion of different authors
who stated their views about the importance of the procurement management in dealing with
the risks associated with the global organizations such as Telstra. Based upon the opinions of
the authors an overall analysis was also included in the later unit which glorifies the
importance of procurement management in dealing with the risks associated with the global
organizations.

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