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The planning process by which an organization acquires various machinery, raw materials to meet the needs of the company. The procurement department is usually tasked with the various acquisition of different products. The organization needs to assess the gaps that are present in the various department's needs regarding resources. The procurement department needs to create a plan that will prove to be sufficient.
The requirement of procurement planning
The first step of the procurement planning involves the procurement department to identify and assess the needs of the various departments of the organization. The procurement officer is tasked with the responsibility of collecting the various needs of the departments and listing them according to the priority (Brammer and Walker, 2016). The procurement department then sets off to explore the multiple suppliers of the various resources required by the departments in the organization. The procurement department explores the availability of the goods in the market and the prices that the suppliers wish to sell their products to the organization. The procurement then determines the required amounts of the various resources which are required by the various departments. The organization then is tasked with the responsibility of estimating the costs of that will be required to purchase the various goods needed by the departments (Brammer and Walker, 2016). The procurement department is also tasked with the responsibility of verifying the validity of the goods required by the various departments. The procurement department will examine the needs and the interrelationships among the listed need to reduce the costs that might be used to acquire the goods. The procurement officer can consolidate the listed requirements that are similar in the various departments. The procurement department then creates methods which may be appropriate to acquire the listed goods required by the various departments. The procurement strategies that will be used will entail scheduling the lead time of the multiple procurement processes. The procurement strategy needs to create an implementation bar chart to ensure the effectiveness of the various methods identified and used in the procurement process.
Conducting the procurement.
The requisition stage usually commences after the procurement plan that was created has been approved by the relevant authorities in the organization. The various departments who were involved in the requesting procedure should submit the procurement needs to ensure procurement procedures begins. The first stage of the requisition process is through determining the various goods required by the multiple departments in the organization (Brammer and Walker, 2016). The various officials tasked with the procurement process are then tasked with the responsibility reviewing the specifications needed to ensure completion of the procurement process.
The department heads are required to draft a requisition receipt for the various requirements the departments expect to be bought. The requisition needs to give a vivid overview of the description of the needed item and the quantity required by the various departments. The move by the various departments to describe the necessary goods will ascertain the potential bidders know the specification of the required goods by the various departments (De Araujo et al., 2017). The potential bidders can also provide the different prices of the commodities needed by the organization. Once the specification of the requirements is vivid to the potential bidders, the process of solicitation can commence. The process requires being in line with the laid-out procurement procedures set by the organization. However, if the specifications are not vivid to the potential bidders, then clarification is usually required to ensure the effectiveness of the procurement process (De Araujo et al., 2017). Adequate description of the goods provides that avoidance of mistakes or discrepancies that may arise in the organization due to the acquisition of the illegal products. The organization can minimize the wastage of resources the company can acquire the adequate products required by the multiple departments in the organization.
Completion of the requisition process will ensure the organization will be able to achieve the procurement plan of the organization. The requisition process also entails the organization verifying if the required goods will also need the acquisition of expertise to deal with the situation(De Araujo et al., 2017). However, if the needed goods which are to be purchased by the multiple departments require any form of knowledge, then the organization needs to verify the type of expertise that the department expects to acquire to ensure completion of the procurement process. Checking of the skill required by the various departments will provide efficiency in the procurement process as the potential bidders will know specifications needed for the various departments in the organization.
Furthermore, the entity requesting for the goods or services from the potential bidders require maintaining an open dialogue to ensure proper communication between the two organizations. Efficiency in the connection between the two entities will reduce chances of the disappointments among the organizations. Effective interaction between the two institutes will ensure there is no rejection of goods and services procured as the potential bidders will have adequate and correct specifications that will enable that the bidders can deliver products that match the specification of the procuring entity.
The stage of the solicitation mainly deals with potential bidders. The solicitation process can be done either electronically or manually depending on the systems of the procuring entity. The solicitation process entails mostly the competitive bidding in which the bidding process is usually sealed in most cases. The sealed competitive bidding process ensures that the procurement process is up to standards and guarantees fair play in the bidding process.
The first step of the solicitation process is the submission of the bids by the potential bidders. The potential needs to offer the details or description of the bids submitted by the organization. The procuring entity is required to verify the details of the bids, and if there are any alarming questions on the bids, the procuring entity needs to contact the potential bidders to confirm the details of the proposal before the lapse of the deadline time. The bidders are required to pay attention to the details and instructions that guide the solicitation process in submitting the bidding offers to the procuring entity. The potential bidders should ask questions on aspects that require further clarification from the buyer. However, the potential bidders need to submit their bids before the duration specified in the documents by the buyer.
The second step of the solicitation process is opening of the bids which is done after the completion of the submission of the attempts by the organization. The opening of the bids can either be open or sealed depending on the entity status. Most governmental entities usually prefer public opening of the bids to ensure openness in the bidding process (Patrucco et al., 2016). Private entities typically favor the opening of the submissions are done privately and later the details are disclosed only to the participants in the bidding process. However, the bidding process may result in protests by the potential bidders if they feel the bidding process was not open and fair (Patrucco et al., 2016). The bidders who are not comfortable with the bidding process are allowed to fail a complaint to the buyer who will in turn address the allegations raised by the claimant bidder. In my perceptions, I believe that the organizations need to be very clear in indulging in an open form of bidding to ensure transparency of the procurement process.
Awards - Selecting sellers
The stage of awarding the contract to the seller is usually very vital and crucial in the organization. The project needs to focus more on the bidder and the bid. The buyer usually has to verify and ascertain that the seller can meet the specifications of the details in the bid. The criteria that are to be chosen by the organization must be fair and free from flaws to ensure the success of the procurement plan laid by the organization. The organization needs to check the details of the price, the quality that potential bidders are offering and the financial status of the organizations that have participated in the bidding process to ensure that the organization can meet the needs of the organization. The procuring entity needs to ensure that the organization prices are favorable to minimize costs in the organization. The organization verifying the quality of the goods supplied by the organization will ensure that the organization acquires products and services that meet the standards of the needs of the various departments. Verifying the financial status of the bidders will measure the ability of the organization to supply the goods in time.
The procuring entity requires having an evaluation matrix that will evaluate the bids to ensure transparency in awarding the contract to the seller. The evaluation matrix will ensure fairness and transparency in placing the proposals by the organization. Exclusion of the bidders may occur if the bidders do not match the requirements of the bid set by the procuring entity. The procurement needs to outline the grounds on which the bidding organization has expelled the organization.
The project administration in the procurement process usually commences after selection and awarding of the bid to the most suitable seller. The administration stage often deals with the legal requirements in the that will guide both the seller and the buyer in the procurement project (Marius, 2017). The contract will be a legally binding document that will urge both the buyer and the seller. The deal will outline details of how the buyer requires the goods and services needed by the organization are going to be supplied by the seller (Marius, 2017). The contract will reflect that the terms and conditions that will be adhered by both the buyer and the seller. The agreement should outline possible causes that may lead to the suspension of the seller. Both the buyer and the seller are usually required to participate in drafting the legal document. Contract administration ensures efficiency in the procurement process in the organization.
Contracts, Incentives, and Risks.
The contracts and incentives of the procurement plan are usually considered after the completion of the administration process. The arrangements, incentives are often vital in the planning process. Both the buyer and the seller need to be equipped with the agreement of the procurement project. The deal will provide guidelines on how the procurement process will be undertaken by both the buyer and the seller in procurement project. The seller and the buyer need to identify the risk that may affect the procurement process. The buyer and the sell need to identify strategies that will help counter the potential threats that may derail the success of the procurement process (Basu et al., 2017). The strategy implemented will involve minimizing the dangers or avoiding the risks at all costs. The buyer needs to identify incentives that will be used to ensure that the project attains its primary goal. Spurs will have the primary aim of stimulating the procurement project.
Quality and closure.
After evaluating the contract, risks, and incentives of the procurement project, the evaluation of the quality of the project plan is usually an essential phase. The assessment of the quality of the project will ensure success and efficiency of the program (Torvinen, 2016). The evaluation of the budget or costs of the procurement project is usually very vital to ensure that the organization does not exceed the estimated costs by the organization. Assessment of the quality will ensure that the goods and services are delivered within the scheduled time s described in the contract. Once the organizations evaluate the procurement plan and provide that the various stages of the project plan are in line with the laid-out procedures of the project, completion of the procurement process will be terminated. The project in my own opinion will meet be of high quality as the set standards will adhere to the later.
Basu, R. J., Subramanian, N., Gunasekaran, A., & Palaniappan, P. L. K. (2017). Influence of non-price and environmental sustainability factors on truckload procurement process. Annals of Operations Research, 250(2), 363-388.
Brammer, S., & Walker, H. (2016). Sustainable procurement, institutional context, and top management commitment: an international public-sector study. In Sustainable Value Chain Management (pp. 67-86). Routledge.
De Araújo, M. C. B., Alencar, L. H., & de Miranda Mota, C. M. (2017). Project procurement management: A structured literature review. International Journal of Project Management, 35(3), 353-377.
Marius, G. O. (2017). PROCUREMENT PROCESS APPROVALS AND THEIR CONTRIBUTION TO HIGH-QUALITY MARKET DRIVEN PRODUCTS: A CASE OF THE UNITED NATIONS ORGANIZATION STABILIZATION MISSION IN THE DEMOCRATIC REPUBLIC OF CONGO (MONUSCO) ENTEBBE SUPPORT BASE. International Journal of Supply Chain Management, 2(1), 57-79.
Patrucco, A. S., Luzzini, D., & Ronchi, S. (2016). Evaluating the effectiveness of public procurement performance management systems in local governments. Local Government Studies, 42(5), 739-761.
Torvinen, H., & Ulkuniemi, P. (2016). End-user engagement within innovative public procurement practices: A case study on public-private partnership procurement. Industrial Marketing Management, 58, 58.
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