.2: procurement and process
Procurement is the process by which organizations acquire goods, works and services. The procurement cycle involves planning, beginning with needs assessment through needs preparation, inviting offers, contractor selection, awarding contracts, executing and managing contracts, as well as final accounting and auditing. Procurement can therefore be viewed as a strategic component of supply chain management relating to satisfying customer or buyer needs.
The procurement process is one of the most important processes of a company. The procurement process usually varies between companies due to activity times and relations with suppliers (Trkman & McCormack 2010). A basic procurement process starts with the
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These areas of Public procurement process have, for long, been overshadowed with inefficiency, corruption and disregard of fundamental "value for money" considerations. This has adversely impacted the rate and quality of progress in realizing the objectives of national development, especially in developing and transition countries (Tan et al., 2009). Employees may neither engage in, nor give the appearance of engaging in, dishonest or unethical actions. Both are injurious to the public‘s perception of honest government. As a government employee, you might have access to procurement and other nonpublic information that could affect a contract bid or the award process (Wymer & Regan, 2005). Improper disclosure of such protected information could violate numerous laws, as well as ethics rules. It also could subject you to administrative actions, as well as civil or criminal penalties. Public procurement agencies should ensure that there is an appropriate focus on good practice
Procurement is the act of obtaining or buying goods and services. So it’s the process an organisation uses to buy the products or services it needs, from other organisations. So procurement department for Tesco is essential in order for them to be able to sell products and offer a service to their customers. Without the good and services it needs Tesco would not be able to operate so it’s essential the procurement team do a good job.
First, the top solution is not to enter into a single source procurement situation in the first place. It is very important for the public procurement there is no charge of corruption can be levied at either party, government or organization should rigorously review their purchasing strategies to ensure that this does not happen.
A basic definition for the procurement is “the way the building is realised” and “involves assembling and organising the skills and services of a team of construction professionals”. (the Construction Round Table, 1995). More precisely, the construction industry describes procurement as “a system that establishes the roles and relationships which make up a project organisation”; hence the overall organisation and communication structure for the management, administration and control of a project is established by the procurement system. (D.C.H Coles, 2010)
The Customer relationship, Order fulfillment, and Supplier relationship processes need to be analyzed from the perspective of process structure, process improvement, layout, and capacity.
This paper will explore how Sealed Bidding and Competitive proposals compare against each other. In order to compare them one must understand how, when and why each topic is used. The primary source of federal procurement information and guidance is the Federal Acquisition Regulation, which consists of Parts 1-53 of Title 48 of the Code of Federal Regulations (CFR). FAR parts 14 and 15 explains in full detail Sealed Bidding and Competitive Proposals. This paper like the federal government will rely heavily on the FAR as a source document to help explain the details of this topic.
In this assignment I will be writing a formal report that will explain a typical procurement process, I will outline a variety of methods of supplier reimbursement and contract relationships; I will also outline the pros and cons of each contract type. As well as this, I will explain a typical supplier selection process through the use of Carters 10 C’s and a typical selection process model.
Procurement management is the processes to purchase or acquire the products, services or results needed from outside the project team to perform the work. Project Procurement Management involves not just purchasing products, services or results, but also ensuring that those that are purchased are right for the project, meets standards and is based on project requirements. This life cycle includes tracking from order through deployment and completing with invoice reconciliation.
Procurement by public entities is guided by primary law principles of transparency, equal treatment and non-discrimination, procurement laws sets up an extensive legal framework regarding the procurement of work, supply and service contracts. There are two main reasons for the use of specific procedures i.e. why contracting authorities do not just negotiate or simply buy from the closest supplier. First, it provides for more public accountability and therefore less cases of corruption practices. Additionally, tendering procedures aim to ensure the best value for money by making it necessary for suppliers to act highly competitive. As a result, market mechanisms will help in facilitating the best possible practices. In situations where market mechanisms are not effective, tender procedures might lose their effectiveness as well. If for example there is lack of competition due to certain complexities or as a result of lower bidder interest, negotiations with just one or two suppliers may be the most efficient manner to handle the process. Therefore, we discuss the inherent advantages and disadvantages of sealed bidding and contracting by negotiation as procedural frameworks for tendering.
It is quite challenging to discuss about procurement management without stating the importance of its strategies. There are four main basic procurement strategies that serve different functions within a procurement management. To begin with, a “Partnership” strategy focuses mainly on constructing mutual commitment in long term relationship with suppliers. While a “Secure Supply” strategy aims to secure short and long term supply while reducing risk from suppliers. In addition, a “Category Management and E-Procurement solutions” serves as a tool to reduce logistic complexity, improve operational efficiency, and attempts to reduce the number of suppliers. Lastly, a “Competive Bidding” strategy emphasizes on obtaining the “Best Deal” for short term transactions with suppliers.(van weele) Each of these four strategies involves a unique purchasing methodology, which implies that the complexity is embedded in an individual strategic implication. Therefore, it requires different tools to accomplish the specific strategical characteristics. A business entity may need to support and execute procurement decisions with other strategic apparatus with analytical methods, including market analysis, uncertainty analysis, price forecasting, supplier relationship and along with others.(Harvard)
The procurement section of Target’s supply chain is an essential part of how it replicate costs to customer requirements. The overall affiliation between customer fulfillment and the supply chain are closely linked to products that are designated based on benchmarks that have been appropriately matched to target costing structured with market criticism and feedback provided. When focusing on purchasing products to sell to customers, the organization selects and processes the best option that best matches Target’s
Comparing to the option of upgrading the whole procurement system, my recommendation aligns with Russell Menere (National Procurement Manager of BAL)’s idea, which is to implement short term improvements based on current procurement system in
Procurement intends to explore supply market opportunities and to implement resourcing strategies that deliver the best possible supply outcome to the organization, its stakeholders and clients (Kidd, 2005). Therefore, construction procurement exists to purchase a construction project as requirement of firms or organizational entities to achieve its goals. However, the choice to use external resources is the part of firms’ decision-making
Public procurement systems across the European Union (EU) need to be robust, transparent and open to public monitoring. Only then can governments, bidders and contractors be held to account for how public money is spent, and corruption can be prevented. Corruption siphons off public funds, obstructs the functioning of the single market, and distorts fair competition. For these reasons, it is vital for the EU to ensure public procurements are sound, transparent and accountable. Public procurement at the EU-level is currently being reviewed; the inclusion of strong anti-corruption provisions is a way of increasing efficiency and creating the
Procurement strategy is the important strategy involve the supply chain management, It provides the business could access the opportunities to reduce the cost, makes the quality promise, consequensely, gain the profit. The supplier selection process starts with the requirements of the materials for the business. The processes of the supplier selection include supplier identification, supplier evaluation and set the contract with the supplier. Supplier selection is designed to ensure their quality, safety and efficiency.
Procurement is also referred to as the sourcing and purchasing of goods and services for commercial purposes. Every decision unit, be it a farmer or a firm, sets procurement policies that govern its choice of suppliers, products, and the methods and procedures of buying. Depending upon the size of the decision unit and the complexity and level of formality of the agribusiness concern, procurement practices are evolved in various segments.