BSBPMG416 - Mastering Project Procurement Procedures & Best Practices

This assignment provides a comprehensive overview of project procurement procedures, addressing key aspects such as effective procurement management, inputs to procurement management, delegated authority in procurement planning, and essential components of a procurement plan. It delves into the significance of contracts, considerations for planning contracts between organizations and suppliers, and the role of suppliers in the procurement process. The assignment also explores tools and techniques for gathering supplier information, methods for supplier selection, and the impact of terms and conditions on contracts. Furthermore, it covers practical elements such as purchase order creation, discrepancy management, and the importance of maintaining procurement records. The document concludes with a discussion of contract closeout processes, procurement audits, and the responsibilities of procurement officers in ensuring effective and ethical procurement practices.

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: