1. Apply Contract and Procurement Procedures Introduction to Procurement Certificate IV in Project Management Qualification Code BSB41507 Unit Code BSBPMG408A

2. Project Procurement Management
Includes processes to purchase or acquire products or services from outside of the project team
It also includes the contract management and change control processes required to develop and implement purchase orders and contracts
The project procurement processes form the lifecycle of any contract that is established as part of that process
A complex project can involve managing multiple contracts or subcontracts simultaneously
Purchasing interactions with government departments and large organisations are often dictated by complex and formal procurement policies and procedures
Adapated from PMBOK 4th Edition

3. Procurement Contracts
Project procurements often involve a formal contract, contracts are legal documents between a buyer and a seller that are mutually binding
Sellers are obliged to provide the specified products or services
Buyers are obliged to provide monetary compensation
Some contracts are extremely complex and others can be very simple
Contracts will include terms and conditions specified by the buyer and negotiated with the seller
Contracts normally require an extensive negotiation and approval process including expert assistance form procurement and legal proessionals
Adapated from PMBOK 4th Edition

4. Procurement Approaches
Quotation
Often requires three to five quotes and selecting the lowest or the one that best fits the requirements
Proposals are sought from a pre-selected group of potential suppliers
Proposals are sought from all potential suppliers
Recurring purchasing from a previously selected and well performing supplier
Pre-qualified list of potential suppliers for different categories of products or services
Closed
Tender
Open
Tender
Previous
Supplier
Preferred
Suppliers

5. Tender Process
Procurement processes for large organisations and government departments normally include some form of tender process
Tender processes can be very complex and time consuming so they are normally reserved for major procurement, often over a particular monetary threshold
There are different types of tenders available – open and closed
There are many different potential steps that can be included in the tender process depending on the preferences and policies of the purchasing organisation
Tenders result in a legally binding contract between the buyer and the seller
Adapated from PMBOK 4th Edition

6. Common Tender Process

7. Tender Definitions RFI – Request for Information
An open enquiry that spans the market seeking broad data and understanding
RFQ – Request for Quotation
An opportunity for potential suppliers to competitively cost the final chosen solution(s)
RFT – Request for Tender
An opportunity for potential suppliers to submit an offer to supply goods or services against a detailed tender

8. Tender Definitions RFP – Request for Proposal Supplier Briefings
An opportunity for potential suppliers to submit a detailed proposal on their ability to meet the requirements of the tender
Supplier Briefings
Held by the buyer with all potential or short listed supplier to answer questions and clarify requirements
EOI – Expression of Interest
An opportunity for potential suppliers to show interest in responding to a tender

9. Procurement Policies and Procedures
There are many excellent procurement related websites and resources available online –
– Federal government tenders
- NSW government tenders
– VIC government tenders
– VIC purchasing board
- Federal purchasing policy
– AUS procurement and construction council
- Federal government procurement guidelines and information

10. Next Steps
Please proceed to Procurement Processes in the Learning Program. Best of Luck! 10