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Summary Procurement process part 1

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Procurement process (part 1)

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Uploaded on
December 30, 2022
Number of pages
17
Written in
2022/2023
Type
Summary

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International sales & procurement




Procurement process (part 1)
Specification phase

 Identify needs: needs => requirements

- Assess/list the needs or requirements
- Collect the list of needs from the user departments
- Research the local market for the prices and availability of goods
- Determine quantities and estimated costs
- Determine when the requirements shall be ready for use
- Consolidate similar requirements
- Identify appropriate procurement methods and processes

Exercise: clarify the needs .. (see slides)

- A need for transport
- A need for BP/KPI software

 WWWWW: why, what, where, who, when?
Does this means procurment is expert in everything?


Question is: how much budget to spend?


Identify stakeholders & compose DMU

- individuals or groups who depend on the organization to fulfil their own goals and on whom
the organization depends.
- are affected by the organization's activities in different ways and to different degrees.
Stakeholders also have power to affect the organisation's activities in different ways and to
different degrees.

- Can be Internal or external

What is stakeholder management?
 the need to take stakeholders into account when formulating and communicating plans.
 Once key stakeholders have been identified, it is possible to plan a stakeholder management
strategy/plan for each. …. but first do a Stakeholder analysis

Stakeholders have the ability to influence ..
- Reliability
- Quality
- Cost and Pricing Decisions
- Potential for Innovation
- Control of Strategic Resources

,Stakeholder relationship management can be relevant for ..
- Gathering information about groups and their interests
- Prioritizing groups which have most potential impact
- Establishing opportunities for co-operation and synergy
- Continuously monitoring, evaluating and adjusting the relationship over time

Internal External
Members of the organization: include a number of parties who are not
- The directors directly connected to the organisation, but
- Managers who contribute to its activities, or are
- Employees who operate witin the impacted on by its activities.
organisation’s boundaries
Include:
Key internal stakeholders: - the government
- Senior management - pressure and interests groups
- Procurement managers - the media
- Managers - local communities
- Staff of other functions or units of the - wider society…
organisation whose work and goals
interact with those of the
procurement or supply chain function.


Stakeholder analysis
 Why Stakeholder analysis => Different Action Plan per group

 Mendelow’s Matrix : valid for every kind of stakeholder analysis
 Transformation project in Company
 Replacement of new machine
 Move to new Building
 …




Exercise :
Our company has still an old in-house developped
Warehouse Mgt software system (maintain by an
internal IT person)
The plan is to buy a new modern software.
 Stakeholder analysis !

, Stakeholders => DMU (decision making unit)

 What ?
- team of individuals who participate in a buyer decision process.
- relates to business or organizational buying decisions.

 Why ?
- Minimalise the risk by involving as many people as possible in the
decision making process.

 Who ?
- Typical Roles (see scheme)


Case : Our company will replace the current company cars by E-Cars in the coming year.
=> Compose you DMU


Prepare procurement process & planning


The procurement process: 6 phases




Selection


- Define sourcing strategy (single/multiple suppliers?, fixed price
or not?,..)
- Supplier long list + RFI
- Supplier short list + RFP / RFQ
- (Final) selection of supplier (incl negotiation)
- Contracting


Sourcing strategy
- # Suppliers ?
 Single vs. Multiple suppliers ?

- Type of contract
 Fixed Price
 Time & Material


- Pro & Cons ?
- Typical cases/industries for Fixed Price vs. Time & Material
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