C/P Planning Process

Can you explain the contract/procurement planning process?

Make versus buy

The first planning decision could be "make versus buy"

This depends on a number of factors

·         Relative economics

·         In-house capacity currently available

·         The need for control or secrecy

·         Advantages of access to supplier knowledge and skill

·         An opportunity to maintenance a robust supplier

·         The relative risks involved and

·         Capital investment versus expense

·         for tax purposes

Multiple contracts - 1

·      The second decision may be one contract

·         Or several overlapping contracts

·      Benefits of multiple contracts include

·         Possible saving in time

·         I.e. "fast-tracking"

·         Greater visibility and control

·         Greater flexibility in making changes

·         If the requirements are likely to be "fluid"

Multiple contracts - 2

Disadvantages of multiple contracts include

·         Increased management and supervision

·         For coordination and oversight

·         Liability to other contractors

·         For failure for any one

·         Or failure to coordinate

·         Diffusion of accountability for results

Solicitation planning process - 1

·      The activities for solicitation planning include

·         Conduct market analysis

·         Establish degree of uncertainty in scope

·         Document time and cost objectives

·         Document assumptions and constraints

·         Document best, i.e. least, contracting risk

·      The result at this point should be

·         A summary of contract requirements

Solicitation planning process - 2

·      Solicitation planning may be further expanded by the following activities

·         Prepare and issue a request for information (RFI)

·         But only if needed

·         Analyze and summarize feed back from requests for information

·      Resulting in

·         An RFI response summary document

Solicitation planning process - 3

The next steps are to

·         Recommend best contracting strategy

·         Recommend most suitable form of contract

·         Including most appropriate form of commercial terms

·         Recommend submission evaluation criteria for screening and weighting

·         Assemble and recommend list of "approved" suppliers

·         For the work contemplated in the contract

Solicitation planning output

The preceding steps should result in

·         A set of procurement recommendations

·         Including contract form

·         Selection criteria and

·         A list of suppliers

·         Submitted to the project's project director/manager