Procurement Management - PowerPoint PPT Presentation

Loading...

PPT – Procurement Management PowerPoint presentation | free to download - id: 4bacdf-MzA2O



Loading


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation
Title:

Procurement Management

Description:

The process to acquire goods and services. Introductions Who are you? How much knowledge have you about procurement? Is it a significant factor in your working day? – PowerPoint PPT presentation

Number of Views:1928
Avg rating:3.0/5.0
Slides: 147
Provided by: peterd48
Learn more at: http://www.e-campus21.com
Category:

less

Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: Procurement Management


1
Procurement Management
  • The process to acquire goods and services.

2
Introductions
  • Who are you?
  • How much knowledge have you about procurement?
  • Is it a significant factor in your working day?

3
Introduction
  • DefinitionsThe contractProcesses.

4
Objectives
  • To understand procurement definitions
  • To become familiar with the process of
    procurement in projects
  • To understand the procurement management phases
    in the PLC.

5
Definitions
  • The entire process by which businesses acquire
    from external sources the resources that they
    need to carry out their missions and administer
    their programs.

6
The Contract
  • The procurement process finishes with a contract
    between the two parties
  • The buyer who wishes to make the purchase
  • The seller who is willing to buy the good or
    services.

7
Procurement Planning 1
  • Inputs
  • Scope statement
  • Product description
  • Procurement resources
  • Market conditions
  • Other planning outputs
  • Constraints
  • Assumptions.

8
Procurement Planning 1
  • Tools and techniques
  • Make-or-buy analysis
  • Expert judgment
  • Contract type selection
  • Outputs
  • Procurement management plan
  • Statement(s) of work.

9
Solicitation Planning 2
  • Inputs
  • Procurement management plan
  • Statement(s) of work
  • Other planning outputs
  • Tools and techniques
  • Standard forms
  • Expert judgement.

10
Solicitation Planning 2
  • Outputs
  • Procurement documents
  • Evaluation criteria
  • Statement of work updates.

11
Solicitation 3
  • Inputs
  • Procurement documents
  • Qualified seller list
  • Tools and techniques
  • Bidders conference
  • Advertising
  • Outputs
  • Proposals.

12
Source Selection 4
  • Inputs
  • Proposals
  • Evaluation criteria
  • Tools and techniques
  • Contract negotiation
  • Weighting system
  • Screening system
  • Independent estimates.

13
Source Selection 4
  • Outputs
  • Contract.

14
Contract Administration 5
  • Inputs
  • Contract
  • Work results
  • Change requests
  • Seller invoices
  • Tools and techniques
  • Contract change control system
  • Performance reporting
  • Payments system.

15
Contract Administration 5
  • Outputs
  • Correspondence
  • Contract changes
  • Payment requests.

16
Contract Close Out 6
  • Inputs
  • Contract documentation
  • Tools and techniques
  • Procurement audits
  • Outputs
  • Contract file
  • Formal acceptance and closure.

17
How does it fit in Pmbok?
18
Procurement is concerned with these
19
(No Transcript)
20
(No Transcript)
21
(No Transcript)
22
(No Transcript)
23
(No Transcript)
24
Project v Operationalprocurement
  • Project size
  • Specification
  • Supplier selection
  • Payments

25
(No Transcript)
26
Procurement Planning
  • Scope statementMake or buyTypes of contract.

27
Procurement Planning
  • Inputs
  • Scope statement
  • Product description
  • Procurement resources
  • Market conditions
  • Other planning outputs
  • Constraints
  • Assumptions.
  • Outputs
  • Procurement management plan
  • Statement(s) of work.

28
Procurement Planning
  • Tools and techniques
  • Make-or-buy analysis
  • Expert judgment
  • Contract type selection.

29
Scope Statement
  • Describes
  • Project needs and strategies
  • Documents 3 aspects
  • Project purpose
  • Project objectives
  • Major project deliverable
  • The decision to be made is, what if anything is
    to be procured-focus. What is to be achieved
    rather than how it is to be done.

30
Product description
  • This sets out the end characteristics of the
    product/ project
  • created by the buyer
  • benefits from the involvement of suppliers
  • Creates a SOW.

31
Procurement resources
  • Two alternatives
  • Centralised
  • Decentralised.

32
Centralised Procurement v Project Procurement
  • Centralised
  • Procedures are usually stringent and standard
    across projects
  • The buyer is not really committed to a particular
    project
  • Not dedicated
  • Project
  • Buyers have no conflict of interest.

33
Market conditions
  • Consider what products are available in the
    market place
  • sources of supply
  • product availability
  • indicative pricing
  • technological change.

34
PM plans
  • Procurement planning must be in line with
  • project plans
  • consider
  • quality
  • scope
  • cost
  • risk
  • time.

35
Constraints and assumptions
  • Put yourself in the buyers shoes. What
    constraints and assumptions will limit your
    options?

36
Constraints and assumptions
  • Funding
  • Lead times
  • Supply trends
  • Legal restrictions
  • Internal and external resources
  • Environmental
  • Occupational and health
  • International sanctions.

37
Procurement management plan
  • Shows
  • How will solicitation to contract close be
    managed?
  • Identify important issues
  • who will deal with them
  • how will they be dealt with?

38
Statement of work
  • Description of product or service to be supplied
  • in enough detail for supply to comply
  • SOW should include
  • nature of item
  • needs of buyer
  • contract form.

39
Make or Buy
  • Determine whether a particular product can be
    produced cost-effectively by the performing
    organisation
  • Either produce in-house or purchase externally.

40
Make or Buy
  • Make
  • Sourced internally by the performing organisation
  • Buy
  • Sourced externally from a contractor.

41
Reasons to Make
  • Cheaper than buy
  • Quick response
  • Available in house skills knowledge and equip
  • Easy integration of project operations
  • Takes up idle internal capacity
  • Direct control
  • Secrecy requirements.
  • Nothing suitable externally
  • Unreliable external contractors
  • Need to retain core skills
  • Stability of workforce
  • Industrial relations
  • Emotional attachment to self sufficiency.

42
Reasons to Buy
  • Cheaper
  • Quicker
  • Lack of in-house skills
  • External technical expertise required
  • Limited internal capacity
  • Maintenance of multiple sources
  • Greater quality demands required than available.

43
Types of Make or Buy Decisions
  • 3 broad categories
  • Based on existing resources
  • Internal make is excluded if existing resources
    not available
  • External buy is excluded if internal capacity
    is more economical.

44
Types of Make or Buy Decisions
  • Minor acquisition or divestment of resources
  • Minor acquisitions may not affect asset base
  • Conversely divest internal minor resources and
    source external project elements previously made
    internally.

45
Types of Make or Buy Decisions
  • Major acquisition or divestment of resources
  • Major acquisition to provide internal source of
    ongoing use (product or project)
  • Alternatively the organisation may purchase
    externally and divest an internal facility.

46
End of week 8
47
Solicitation Planning
  • Specifications.

48
Inputs to SP
  • Describe the remaining procurement process
  • Description of products or services to be
    supplied under contract
  • Cost and schedule estimates, quality, risks,
    scope, planned staffing.

49
Outputs from SP
  • Documents
  • Proposals are obtained from prospective
    contractors
  • Technical, legal and commercial requirement for
    the procurement item
  • Drawings, specifications, contractual terms and
    conditions.

50
Outputs from SP
  • Clear
  • Define the contractual obligations
  • Details of the scope
  • Provide information concerning risk
  • Supporting information required
  • State the evaluation criteria
  • Allow options
  • Time of lodgement.

51
Specification-introduction
  • The foundation of every successful purchase
  • A formal description in objective and measurable
    terms
  • Contains all the elements of the project
    definition.

52
Specification-introduction
  • Must communicate and convey information
  • Recipient must have full details to conform.

53
Specifications
  • Specifications have 3 roles
  • A legal contractual document
  • A post award working document
  • An estimating or tender document.

54
Types of Specification
  • Descriptive/ technical
  • This sets out the detailed and comprehensive
    requirements of a product or service
  • Type and quality of material
  • Workmanship
  • Method of assembly.

55
Types of Specification
  • Performance/ functional
  • This defines the desired end result for a product
    or service
  • They provide a clear indication of the purpose,
    function, application and performance expected.

56
Group work
  • Divide into 2 groups
  • Group 1 is to write in note form a descriptive
    specification for a shovel
  • Group 2 is to write in note form a performance
    specification for a shovel
  • Nominated group leader to discuss with class
  • Class discussion relating to this and advantages/
    disadvantages.

57
Descriptive/ Technical
  • The specifier has considered the functions and
    has the experience to know that it will perform
    under set conditions.

58
Descriptive/ TechnicalAdvantages
  • Buyer has complete understanding of the
    procurement item
  • Specification of the item is compatible with the
    remainder of the project
  • Buyer does not need to review contractors
    designs.

59
Descriptive/ TechnicalAdvantages
  • Easy for buyer to inspect fabricated material and
    equipment
  • Contractor may commence work as soon as the order
    has been placed
  • Well defined basis for fixed price accomodating
    variations.

60
Descriptive/ TechnicalDisadvantages
  • Costly and time consuming for buyer to prepare
  • Contractors expertise is not utilised.

61
Function Example
  • The functional aspects for a machine include
  • Output rate
  • Production tolerances
  • Capacity
  • Control methods, and
  • Power requirements
  • The contractor must then provide a product to
    meet the specification.

62
Functional/ PerformanceAdvantages
  • Focus on results
  • Stimulates solutions rather than repetition
  • Provides innovation/ novelty
  • Contractors can contribute ideas
  • Reduces buyers time and effort in preparation.

63
Functional/ PerformanceAdvantages
  • Relieves buyer of responsibility for design
  • Removes bias to one product
  • Bidder can focus on best solution.

64
Functional/ Performance Disadvantages
  • Difficult to define performance in all areas
  • Difficult to compare different solutions
  • Difficult to ensure the performance specified is
    measurable.

65
Functional/ Performance Disadvantages
  • Used by buyer as substitute for thought
  • Evaluation and management of contract may be
    complex and costly
  • Technical specifications may be faster and
    cheaper to take to tender.

66
Specification Writing
  • The foundation of a good specification is
    planning and analysis
  • Concise
  • Cover all aspects without excessive detail
  • Complete
  • Every important characteristic must be covered
  • Clear
  • The user should never have to interpret the
    specification.

67
Specifications Typical Contents
  • Name and address of originator of spec
  • Title
  • List of contents
  • Introduction
  • Background
  • List of definitions.

68
Specifications Typical Contents
  • Statement of scope
  • List of applicable documents
  • Detailed requirements
  • Functional, performance, technical
    characteristics
  • Quality requirements
  • Testing.

69
End of week 9
70
Tendering (Solicitation)
  • Tendering best practiceProcurement methods.

71
Solicitation Methods
  • Tendering
  • The formal, documented, structured process,
    where the tenderer undertakes to enter into a
    formal agreement with the client
  • For the performance of a service at a price
    offered in tender submission.

72
Basis of Evaluation
  • Two major strands of competitive tendering
  • The open tender
  • Restricted tender (selective tender).

73
Open Tendering
  • Pre-qualification
  • Contractors must establish that they have the
    necessary competence
  • Resources
  • Financial capacity
  • Industrial relations expertise
  • Quality/safety management procedures
  • No pre-qualification
  • Considered in the future for selective or
    pre-qualified work.

74
Open Tendering
  • Advantages
  • No chances of favouritism (particular concern to
    the public sector)
  • It allows an unknown contractor to be considered
  • It provides for keen competition from a large
    number of applicants.

75
Open Tendering
  • Disadvantages
  • Time taken to review a large number of applicants
  • The cost in tendering and the general cost to the
    industry is high
  • It may be difficult to screen and select from the
    wide range of applicants.

76
Selective Tendering
  • A short list is formulated based on some form of
    pre-qualification criteria
  • The number of tender for a project is typically
    limited (three to six)
  • Each is then asked to provide a tender
  • Pre-qualification or pre-registration is required
  • Indicates the contractors ability in defined
    areas.

77
Selective Tendering
  • Advantages
  • Only capable and approved firms are involved
  • The cost of tendering is reduced
  • Provides limited competition
  • Considered tenders are generally received.

78
Selective Tendering
  • Disadvantages
  • Opportunities for collusion
  • Missed opportunities
  • Industry complaints (those not selected)
  • Reduced competition forces prices up.

79
Negotiation
  • Two main approaches
  • Single stage negotiation
  • Single contractor is selected without competition
    and a contract is negotiated
  • Sometimes referred to as a strategic alliance.

80
Negotiation
  • Two stage negotiation
  • Invitation to register interest
  • One contractor is selected and negotiations
    become more detailed as the final agreement is
    reached.

81
Negotiation
  • Advantages
  • The required quality and function is achieved
  • The project objective and definition may be
    managed (two stage)
  • Speed (single stage)
  • Disadvantages
  • Cost
  • Less formal
  • Lacks accountability.

82
Evaluation
  • State the project/procurement objectives clearly
    define responsibility limits
  • Select the procurement strategy to suit the
    nature of the project, contract
  • Provide documentation that clearly identifies the
    project objectives
  • Ensure that the contract documentation provides
    for all potential outcomes
  • Avoid loopholes.

83
Evaluation
  • Ensure that the contractor selected understands
    the requirements of the project
  • Ensure that the contractor is experienced,
    financially sound
  • Not underestimated the project requirements
  • Provide project control.

84
Pre-qualification benefits
  • Reduction in bias
  • Auditability
  • Full appraisal of contractors capacity
  • Raise contractors performance
  • Rewards excellence
  • Reduces likelihood of project failure
  • Saves time.

85
End of week 11
86
Source Selection
  • Value for money.

87
Inputs and Outputs
  • Bidder proposals
  • Evaluation criteria
  • Organisational policy
  • Evaluation team.
  • Ranked offers/
  • Recommendations
  • Record of evaluation process
  • Negotiation and signed contract.

88
Alternatives to Price
  • Price alone selection provides
  • 73 gave less consideration to design
    alternatives
  • 74 are producing simple designs to minimise
    commitment
  • 60 consider that the capital costs associated
    with construction are higher.

89
Alternatives to Price
  • 49 said that the number of visits to site are
    lower
  • 69 see less trust between the client and the
    consulting engineer
  • 79 are spending less money on training
    graduates and technicians
  • 94 bid low to maintain cash flow and test the
    market.

90
Alternatives to Price
  • Price compared with estimated cost
  • Management ability
  • Record of performance
  • Industrial relations and safety record.
  • Conformity
  • Innovation
  • Value for money
  • Construction period
  • Quality assurance.

91
Price only selection
  • Used in conjunction with pre-qual
  • Conforming tenders finally assessed on price
  • Pre-qualification well defined
  • process is robust with appropriate RFT
  • Buyer can award with security
  • Buyer to use an independent cost estimate. What
    criteria?

92
Price only selection
  • Reasonable price benchmarks
  • competitive bids
  • historical prices
  • catalogue or market prices
  • pricing data.

93
Pre-qualification
  • Criteria should be established to evaluate
    contractors
  • Technical capability
  • Does the contractor have the necessary technical
    resources skill and knowledge?
  • What current commitments does the contractor
    have?
  • What is the managements capacity?
  • Is there a level of experience.

94
Pre-qualification
  • Past performance
  • Similar projects?
  • Achieve the clients time, cost and function
    objectives?
  • Quality management
  • Hold or is it proceeding toward accreditation.

95
Pre-qualification
  • Financial strength and stability
  • Sound financial standing?
  • Organisations level of borrowing
  • The number of years it has been in business
  • Its ability to provide bank guarantees
  • Labour relations
  • Health and safety
  • Safety policy.

96
Quantitative Evaluation
  • Qualitative evaluation may be based upon six
    criteria
  • Experience
  • Qualifications
  • Methodology
  • Technical support
  • Resources
  • Fees.

97
Quantitative Evaluationranking
  • Limit number of contractors
  • Weighted scoring methodology
  • Used to establish the most desirable contractor.

98
Quantitative Evaluationranking
  • Each criterion is assigned a weighting
  • Against each criterion the prospective contractor
    is allocated a score within a range
  • (5-very good down to 1-very poor)
  • For each criterion, multiply the weighting by its
    score
  • Finally the weighted scores are totalled and the
    contractors ranked.

99
(No Transcript)
100
(No Transcript)
101
Contract Administration
  • Managing the relationshipsCore contract
    clausesAdministering the contract.

102
Contract Administration
  • Definition
  • monitoring performance and ensuring that both
    parties meet the commitments made in the
    contract.

103
Requirements for successfulcontract management
  • A contract that defines the technical and
    management requirements for the contract work
  • A contractor qualified to perform the contract
    requirements
  • An effective contract management program that
    successfully implements the contract requirements.

104
Project Management Processes
  • Managing the execution of the project plan
  • Producing progress reports
  • Quality control
  • Undertaking change control
  • Financial management of the contract
  • Managing the contractual risks.

105
Inputs
  • Inputs
  • Contract
  • Work Results
  • Change Requests
  • Seller Invoices.

106
Outputs
  • Outputs
  • Performance Reports
  • Contractor Correspondence
  • Contract Changes
  • Contractor Payments.

107
Managing the relationships
  • Co-operative and non-adversarial relationships
  • Develop an overall strategy-specifying roles
  • Be non-adversarial-balance flexibility/ openness
  • Act ethically
  • Establish continuous dialogue.

108
Managing the relationships
  • Establish conflict resolution procedures
  • Keep the contractor up to date with client
    developments and changes
  • Coach and guide team members to preserve the
    relationship.

109
Types of Contract Documents
  • An overview of various standard forms of contract
  • AS 2124, AS4000, AS4300,
  • NEC
  • C21
  • JCC-C
  • PCA.

110
Contract Document Problems
  • Contractual claims
  • Costs in terms of management time and external
    litigation are considerable
  • Harsh forms of contract have been introduced
  • An attempt to reduce claims and disputes.

111
Recent Studies
  • Studies in Australia and the UK
  • NPWC 1990, Latham 1994, Egan 1998
  • Have provided contractual approaches that are
    more equitable and effective.

112
Modern Contract Fundamentals
  • Risk sharing
  • Contracts clearly defines responsibility and
    allocates risk
  • Non-adversarial dispute resolution
  • The use of simple and clear procedures
  • Win-win solutions
  • Fair and reasonable cooperation
  • Mutual trust.

113
Examples of Contract Best Practice
114
JCC-C
  • Fair apportionment of responsibility
  • JCC-C promotes risk sharing
  • Neutral risks may be shared on an equal basis.

115
AS 2124
  • AS 2124 -1992 considers NPWC no dispute (may
    1990)
  • Provides over 100 circumstances for written
    notices
  • The contract is the key method by which
    communication takes place between the parties
  • Enables proper and orderly administration.

116
NEC
  • Includes many special characteristics
  • Win-win
  • Easily comprehended language
  • Guidance notes
  • Separation of roles of the contracts
    administrator or project manager and adjudicator.

117
C21
  • Clear distinction between the contract management
    and administration
  • Up-front payment incentives
  • Simplified delay procedures
  • Representatives of the principal and the
    contractor act for their own party
  • There is no superintendent.

118
PCA
  • Client focussed contract
  • Contracts administrator agent of client
  • Allows client access to site
  • Does not provide for nominated s/cons
  • Allows for client directed accelloration
  • Program is a part of the contract.

119
Fixed Price - Requirements
  • a well-defined scope of work
  • stable market conditions and absence of major
    economic or political uncertainty
  • minimal scope changes. i.e., close control of
    changes
  • effective competition is essential
  • time for scope definition and bidding process.

120
Fixed price Advantages Disadvantages
  • Cost commitment is known at the outset
  • Strong motivation for contractor to perform
  • Relatively easy contractor selection
  • Minimise buyers manpower requirements to
    administer work
  • Fully defined scope
  • Contractor assumes greatest risks.
  • Time required for producing full scope
  • Changes difficult and potentially costly - unless
    a schedule of rates are a contractual requirement.

121
Cost Reimbursable Requirements
  • minimal pre-determined scope definition
  • clearly and explicit definition of what
    constitutes reimbursable costs
  • co-operative atmosphere and a competent and
    trustworthy contractor
  • close audit and quality supervision and direction
    by buyer
  • sufficient scope definition.

122
Cost ReimbursementAdvantages Disadvantages
  • Useful when the scope cannot be specified in
    advance
  • Greater flexibility and control of changes
  • Minimal pre-determined scope definition permits
    early start.
  • Final cost unknown
  • increased costs
  • Contractor has little incentive
  • Buyer retains risk
  • More manpower
  • Reduces ability to compare contractors bids.

123
Measurable - Requirements
  • the scope of the work is generally well defined
    but the amount of work is indefinite
  • sufficiently detailed scope of work to allow
    contractor to calculate unit rates
  • sensitivity analysis of unit prices to evaluate
    effect on final cost for different quantity
    variations
  • all work must be covered by the unit rates quoted.

124
MeasurableAdvantages Disadvantages
  • Scope need not be as accurate
  • Cost per unit of production predetermined
  • Buyer only pays for the work done
  • Suitable for competitive bidding
  • Flexibility- scope quantity can be varied.
  • Final cost not clearly known

125
Main Commercial Terms
  • Scope and Terms of Agreement
  • Prices
  • Payments
  • Payment on completion
  • Stage payments
  • Progress payments
  • Escalation
  • Retention.

126
Main Commercial Terms
  • Changes
  • Increasing, decreasing or omitting any part of
    the contract work
  • Changing the character or quality of material or
    work
  • Calculating any allowable price variation
  • Changing the source of subcontract work.

127
Dealing with change
  • Purchase decides that a variation is desirable
  • Contractor is instructed to assess
  • Contractor submits proposals
  • Purchaser decides whether to proceed
  • If purchaser proceeds negotiation occurs
  • Purchaser issues formal change order
  • Contractor proceeds with work.

128
Main Commercial Terms
  • Warranty
  • Insurance
  • Termination
  • Liquidated Damages
  • Disputes Procedures
  • Bonds
  • Incentives.

129
Risk
  • Basic principles for allocating risks within
    contracts
  • Control
  • Capability
  • Benefit
  • Good Management
  • Cost Effectiveness.

130
Layout and Contents of the Contract
  • Introduction
  • Major Commercial Terms
  • Operational Performance Provisions
  • The Legal Section
  • Miscellaneous Administration.

131
Core contract clauses
  • Performance - obligations of the party
  • Risk - allocate risk
  • Recognitory - monitoring condemnation and
    approval
  • Adaptatory - changes
  • Adjudicatory - resolving of disagreements.

132
Partnering
  • As a alternative procurementstrategy.

133
Traditional v partnering
  • Traditional
  • suspicion and distrust
  • individual goals
  • guarded communication
  • limited objectivity
  • project only involvement.
  • Partnering
  • mutual trust
  • shared goals
  • open communication
  • shared resources
  • commitment by all.

134
Partnering definition
  • a synergy - a co-operative, collaborative
    management effort among contracting and related
    parties to complete a project in the most
    efficient, cost-effective method possible, by
    setting common goals, keeping lines of
    communication open, and solving problems together
    as they arise.

135
Win win
  • must be based on a win-win approach whereby both
    parties understand and work to make the
    partnering relationship mutually beneficial for
    both parties.

136
Core elements
  • Commitment
  • Trust
  • Mutual goals.

137
Question
  • Identify
  • the benefits and,
  • shortcomings of partnering.

138
Partnering - Benefits
  • Lower Costs
  • Better quality product
  • Lower resolution costs through elimination of
    defensive case building
  • Reduced destructive conflict, exposure to
    litigation, claims and disputes
  • Increased opportunity for financially successful
    outcomes for all.

139
Partnering - Benefits
  • Higher respect excellent teamwork higher
    morale less adversarial relationships, increased
    openness
  • Improved safety performance
  • Increased opportunity for innovation and improved
    established practices
  • More access to partners expertise.

140
Partnering - Benefits
  • Increase accountability using performance
    incentives
  • Greater productivity - less paperwork, less
    rework, shorter meetings, reduced manpower needs
  • Improved communications
  • Heightened awareness of, and maximisation
    potential for, achieving project mission.

141
Partnering - Problems
  • Commercial pressure compromising the partnering
    attitude
  • Maintaining open and honest communication
  • Participants conditioned to an adversarial
    win-lose environment
  • Not thoroughly including all parties.

142
Partnering - Problems
  • Obstructions from bureaucratic organisations
  • Project unsuitable for partnering
  • Partners not willing to compromise and craft team
    solutions
  • Overcoming cultural barriers and lack of
    sufficient training for changing attitudes.

143
Partnering - Problems
  • Confusion concerning the relative roles of the
    contract and the partnering agreement
  • Lack of true commitment particularly from top
    management.

144
The process
  • Understanding - Each party becomes aware of its
    own goals, responsibilities, risks, objectives
    and those of the other parties
  • Identifying - Seeking out mutual goals and
    objectives (e.g., financial, time, safety,
    quality, staff moral) overlapping interests
    most likely areas of possible dispute role of
    team members.

145
The process
  • Establishing - Establishing strategies,
    procedures and methodologies for achieving the
    identified goals issue resolution procedures
  • Evaluating - Evaluating progress, issue status,
    people performance, partnering system.

146
The process
  • Documenting Committing - Producing a charter
    setting out the projects aims and procedures
  • Executing - Proceeding with the project, focusing
    on evaluation of progress and issue resolution.

147
Other issues
  • Workshop
  • Issue resolution.

148
Ethics and procurement
  • Ethical considerations
  • Procurement policy.

149
Ethical Considerations
  • Ethics -
  • A system of moral principles, by which human
    actions and proposals may be judged good or bad
    or right or wrong.

150
Ethical Considerations
  • Determined by societys acceptance or rejection
    of business and individual activities
  • Consider
  • Code of tendering
  • Code of practice.

151
Minimising Unethical Behaviour
  • Declare personal interests
  • Confidentiality of information
  • Prevention of the effective operation of fair
    competition should be avoided
  • Business gifts of only a minor intrinsic value
  • Frequency and scale of hospitality accepted
    should not be significant.

152
Ethics and Purchasing Policy
  • Honesty
  • Routines that instil proper behaviour
  • Document quotation records
  • System that provides for supplier evaluations
  • Checks and balances
  • Explicit policy.

153
Ethics and Purchasing Policy
  • Benefits
  • Enhancement of the company reputation for fair
    and responsible dealing
  • Maintenance of high standards of behaviour
    throughout the organisation
  • They indicate to the procurement personnel
    clearly what the organisation has set out to do
  • They engender pride and focus the organisation as
    a whole.

154
Ethics Summary
  • What is due to those with whom I deal
  • Will my action impede my independence of
    judgement at work
  • Will my actions lead others into unethical
    behaviour
  • If my action is ethical will it lead to risk or
    harm to others, stockholders or competition.

155
(No Transcript)
156
End of session
  • Thank you for your attendance and input
About PowerShow.com