This proposal outlines a procurement management plan for efficient functioning in organizations. It includes the selection of suppliers, contract types, risk management, and vendor metrics.
Contribute Materials
Your contribution can guide someone’s learning journey. Share your
documents today.
Running Head: PROPOSAL Proposal Name of the Student Name of the University Author Note
Secure Best Marks with AI Grader
Need help grading? Try our AI Grader for instant feedback on your assignments.
1PROPOSAL Introduction Various organizations employ different management techniques for carrying out efficient functioning in their departments. The procurement management is a form of management where the services and the goods are acquired from a separate organization(Dash et al.2018). Every organization deals with the procurement management and the planning of the process is what ensures the success of the business(Deet al. 2017). It is a management type that helps the organizations to save money as much as possible from outside. The success of the procurement management lies in the highly trained individuals as well as the right type of resources and suppliers. In the DMF Limited, the main problem is that almost all the departmental heads believe in the system of purchasing. There is lack of proper inventory management plan for the large fleet of vehicles and there is also lack of either tyres or spare parts. It has been found that the practice of adhoc purchase in the organization has caused strain in the financial resources. Hence there is a need to clean up and streamline the procurement process. Charles Mwape, who has been provided with the responsibility of everything needs assistance for making the change, a success. The objective of the plan To prepare a good inventory plan and support the financial resources of the company. The procurement management plan The procurement management plan documents and outlines the purchase requirements for meeting the project needs. The responsibilities of the procurement manager are to go beyond
2PROPOSAL approving the purchases. In order to manage the project effectively, a well-planned strategy founded on the comprehensive information is required. The procurement team Firstly, people will be selected to participate in the procurement planning and the decision making process too. Everyone is expected to have the authorization. the required items The required materials include information about the items which need to be purchased. Information will be gathered about all the materials which are required by the project. The tangible and intangible assets might be required such as the software licenses and others. Pertinent information about every item, technical requirements, size and specs will be included. It will help to ensure the purchase of the correct material.The reasons and the justifications of specific items purchased will be included too. A purchasing timeline will be set. It will leverage bulk purchase across various departments having taken the advantages of seasonal discounts, reducing the storage and processing costs with just-in-time delivery and negotiating minimal order quantities. The selection of the supplier The supplier will be selected through the bidding process. The bidding will not be open; it will be rather drawn from a preferred list of vendors. The Bids and acceptance A request for proposal will be issued from the procurement department having detailed the needs of the project. The bidding process will provide certain information such as the costs, the scheduling considerations and delivery time(Huang2018). The vendors will be selected and
3PROPOSAL the contracts will be awarded. The selection criteria will be based on the supplier capability for delivering the materials on time, the cost, the quality, the delivery schedule, the cost comparison of the outsourcing and the in-sourcing along with the vendor history and their company. The contract type The procurement plan will include different types of contracts. The details about the types of contracts will be used in the whole procurement process. The different types of contracts will be used for different categories of items. The purchase order (PO) will be used for the purchase of goods and materials. The firm-fixed price will be used for negotiating the process for contracted services. It will also use the Fixed-Price with Economic Price Adjustment Contracts. The Time and Materials (T&M) will also be used for the material cost and subcontractor rates for installation. The identification of the risk management The risks associated with the dealings with the suppliers are always grave. The potential procurement risks will be listed and strategies will be outlined for managing and mitigating the risks having maintained the relationships of the established companies with preferred suppliers. The potential risks can cause a severe breakdown in the supply chain, delay the projects and overrun the costs. It might include the circumstances, vendor conflict and substandard delivery of products. The procurement plan will also outline the strategies for the risk mitigation. The purchase order process The purchase order process will be run by using the three-way matching authentication. Firstly, the purchasing department will send a purchase order (PO) for authorizing a purchase. Secondly, an invoice will be returned to the vendors having referenced the purchase order(Liu,
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser
4PROPOSAL Han and Yu 2017). Thirdly, the goods will arrive with a packing slip that is verified against the purchase order along with the invoice for ensuring that everything has arrived as per the order. The constraints in the project The budget limit can become a major constraint in the project. order to mitigate the scope creep, the project constraints will be defined carefully which will also include the costs, timeline, technical specifications. It will be considered at every step of the decision-making process having verified against the activities of procurement. The vendor management and accountability The purchasing department will serve as a liaison between the department heads, the project manager and the suppliers(Nojavan et al. 2015). Regular meetings will be scheduled having defined clearly how the meetings will be accomplished. It will also be verified whether the deliveries are on schedule. The vendor metrics The deliver data will be tracked with the quality rating to assess the performance of each vendor. The quality and quantity of services, the invoice costs and deliver time will be noted. The metrics will be used to address the issues, recognize the problems and evaluate the suppliers for future considerations. Apart from this, Charles Mwape is expected to follow few other principles in the fleet procurement process. Firstly, he will speak to everyone involved with the fleet in some way. The representatives can include the risk management, the fleet, legal and service/sales
5PROPOSAL (Patrucco, Luzzini and Ronchi 2016).The inputswill be taken from the stakeholders for ensuring that the best practices of the company can be followed. An asset management inventory will be performed. The assessment of the fleet will help to learn lessons from the past mistakes in the procurement. A balanced approach will be used having considered all the options before financing the fleet that includes the purchase, lease and hire. A technical specification will be defined considering everything. It will include the continuity of the fleet, the total cost of ownership. It is an essential part of the final stages of the whole procurement process to check the vehicles against few performance meeting criteria(Yan, Chien and Yang 2016). The company’s best practices can be met through this. The evaluation and selection of the right partner will help to minimize the risk and at the same time maximize the value during the entire procurement process. Conclusion On a concluding note, it can be said that, the follow up of the above mentioned proposal, will help Charles Mwape to standardize the fleet and push some cost control on the dealers. It will also allow the team to prepare for the vehicle acquisition in future.
6PROPOSAL References Dash, A., Das, R.K., Tripathy, S. and Nayak, S., 2018. Supply chain coordination voyage towardssupplierrelationshipmanagement:acriticalreview.InternationalJournalof Procurement Management,11(5), pp.586-607. De Araújo, M.C.B., Alencar, L.H. and de Miranda Mota, C.M., 2017. Project procurement management:Astructuredliteraturereview.InternationalJournalofProject Management,35(3), pp.353-377. Huang, J., 2018, June. Research on Cooperative Procurement and Warehouse Management of Enterprise Supply Chain. In2018 2nd International Conference on Education, Economics and Management Research (ICEEMR 2018). Atlantis Press. Liu, C., Han, Q.C. and Yu, D.Q., 2017, April. The Government Procurement Management SystemBasedon.NetRemotingTechnology.In20175thInternationalConferenceon Machinery, Materials and Computing Technology (ICMMCT 2017). Atlantis Press. Nojavan, S., Mehdinejad, M., Zare, K. and Mohammadi-Ivatloo, B., 2015. Energy procurement management for electricity retailer using new hybrid approach based on combined BICA– BPSO.International Journal of Electrical Power & Energy Systems,73, pp.411-419. Patrucco, A.S., Luzzini, D. and Ronchi, S., 2016. Evaluating the effectiveness of public procurementperformancemanagementsystemsinlocalgovernments.LocalGovernment Studies,42(5), pp.739-761.
Secure Best Marks with AI Grader
Need help grading? Try our AI Grader for instant feedback on your assignments.
7PROPOSAL Yan, M.R., Chien, K.M. and Yang, T.N., 2016. Green component procurement collaboration for improving supply chain management in the high technology industries: A case study from the systems perspective.Sustainability,8(2), p.105.