Conduct Procurement

This article contains most of the important information you need to know about Conduct Procurements process in order to answer questions related to this topic in the PMP Exam, I recommend you review this type of articles 1 week before your exam date, all information mentioned are based on PMBOK Guide 6th edition and PMP Exam Prep 9th edition for Rita Maclhy’s, ITTO refers to Inputs, Tools & Techniques and outputs.

This process is a part of executing Process group and Procurement Management Knowledge Area with the following ITTO’s

Inputs:

  1. Project Management Plan ( Scope, Requirements ,Communications , Risk Procurement and Configuration Management Plans , Scope Baseline)
  2. Project Documents (Requirements Documentation ,Project schedule , Lessons learned Register , Risk Register, Stakeholder Register)
  3. Seller Proposals
  4. Procurement Documentation
  5. Enterprise Environmental Factors
  6. Organizational Process Assets

Tools & Techniques:

  1. Expert Judgment
  2. Advertising
  3. Bidder Conference
  4. Data Analysis ( Proposal Evaluation )
  5. Interpersonal and Team skills ( Negotiation )

Outputs:

  1. Selected Sellers
  2. Agreements
  3. Change Requests’
  4. Project Management Plan Updates (Scope, Requirements ,Communications , Risk , Quality , Procurement Management Plans , Scope ,Cost and Schedule Baselines )
  5. Project Document Updates ( Lessons Learned register , Recourses Calander , requirements documentations , Requirements tractability matrix , Risk register , Stakeholder register )

 

  • Involves getting the procurement SOW and other procurement documents to prospective sellers , answering seller questions , having responses and select a seller according to the source selection criteria .
  • Major Tools and Techniques :
  1. Advertising, advertisement may be made to attract sellers.
  2. Prequalified Seller List, a list contains all qualified sellers for this service created in earlier project, procurement documents may be sent to this list only.
  3. Bidder Conferences, Mainly this tool is used to maintain integrity of the procurement process , it is a meeting where all sellers participating in the procurement will be invited and contains questions and answers session .
  4. Seller Proposals ,
  5. Proposal reviews , All proposals received from invited sellers will be reviewed , evaluated as per the source selection criteria .
  6. Screening system , Screen out not qualified vendors who do not meet the minimum requirements .
  7. Weighing system
  8. Independent estimates, comparing prices with estimates made in house.
  9. Presentations , Usually used with Cost reimbursable contract type , it is a formal meeting between buyer and seller teams in order to give a chance for the seller to present their proposal .
  10. Negotiations , Usually they are led by procurement manager while project manager must attend , it aims to obtain a fair and reasonable price and to obtain a good relationship with the seller , it should end by a win-win situation , scope , schedule and price are the key items to negotiate , Contracts are signed once negotiations are done and it is awarded to selected seller , here are some negotiation techniques :
  11. Personal Insults , not recommended.
  12. Deadline , “ I should leave in 30 minutes “
  13. Attacks, force Compliance.
  14. Good Guy/Bad Guy , one friendly and one aggressive .
  15. Missing man, “ only the CEO can agree on that “
  16. Lying , obvious or hidden .
  17. Limited Authority, I don’t have the authority.
  18. Fair and reasonable
  19. Delay, escape in critical moments
  20. Extreme Demands
  21. Withdrawal
  22. Fait Accompli , Not negotiable

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