Procurement Management and the Impacts It Has on the Overall Success of a Project

1875 Words 8 Pages
This paper will focus on the concepts of project procurement management and the impacts it has on the overall success of a project. Moreover, paper contains four sections, which focus on some of the major tentacles of project procurement management. Section one, describes in detail the various components that are involved with project procurement management. Section two, summarizes the major project procurement processes, all of which the Project Management Institute (PMI) view as appropriate for successfully executing projects. Section three, describes the various benefits of categorizing procurements into generic families. Lastly, section four, will summarize the importance of project procurement management in the overall project …show more content…
Project procurement management contains six unique processes (procurement planning, solicitation planning, proposal solicitation, source selections, contract administration, and contract closeout) that cover three phases of the procurement life cycle (Fleming, 2003, p. 11). The three phases of the procurement life cycle are definition and planning of project procurements, project procurement process, and managing seller performance. Project procurement is a complex process to manage especially when one considers the legal side of executing contracts for a company. As a result, many companies battle with deciding who should have procurement Delegation of Authority (DOA) commonly known as centralized procurement verses decentralized procurement (Fleming, 2003, p. 7). For example, new start-up companies will virtually allow any employee to execute a contract on behalf of the company (Fleming, 2003, p. 7). Conversely, with mature companies certain rules and regulations apply that restrict that authority to certain individuals. In fact, the first thing a growing company will remove from its employees is the right to execute a contract (Fleming, 2003, p. 7). As a company grows the more risk averse they become, especially when letting employees place orders (legal agreements) to buy a good or service. In a centralized purchasing structure, the authority to buy comes from a functional manager, where as in a decentralized purchasing structure the project

More about Procurement Management and the Impacts It Has on the Overall Success of a Project

Open Document