The paper "Procurement Plan Evaluation" is an outstanding example of business coursework. A project requires the procurement of a large resource to carry out robust project activities. The essential concern of a project manager is to identify and acquire the goods and services needed to implement a project (JICS, 2009). Procurement, therefore, is the process by which goods, services and people are obtained. The process of procurement usually necessitates a written contact formulation. The contract is between the seller and the buyer. There is a need for a procurement plan to make any procurement successful.
This article discusses the concept of planning purchases and the purpose and components of a procurement plan. A Review of the concept of Planning Purchases Planning purchases in procurement focuses on the purchases plan and acquisition model. It involves the establishment of the services and products that can be best acquired but not from the project team. According to Elyse (2007), the process of planning purchases requires for one to understand fully a project, for instance, constraints, objectives and deliverables. The process as well culminates giving a description of each service or product to be procured in a contract statement or specification.
The contract statement details of work are obtained from the scope statement of the project and the structure of work breakdown. Buy or make decisions to determine if services or products are to be outsourced or in-house (Elyse, 2007). The sales growth slowdown was experienced by several companies during the 1970s in Western Europe. The slowdown led to increased awareness about the relevance of measuring the operating performance of a company. The performance was relative to the assurance of production interest as well as the performance of the competitors.
Traditionally, reduction managers enjoy a status that is very low within the hierarchy of management. This is however particularly true about the purchasing managers. Several industrial companies having manufacturing costs that are high realize that the cost of purchasing materials has a beneficial and immediate impact on the profitability of the company. The plan purchases concept is, therefore, to determine what to acquire or purchase and to determine, as well, how and when (Dobson & Shorrock, 1980).
The concept also identifies the project needs that can be best met by acquiring or purchasing services, results or products outside the organization of a project. It also establishes the project needs that can arise during the execution of the project by the project team. The process involves reviewing the involved risks in every make-buy decision. It also involves reviewing the kind of planned contract meant to be used. The process targets risk mitigation and transferring risks to the seller. There are stipulated inputs that acquisition processes and plan purchases use. The inputs have foundations that determine when, how and what to purchase.
The inputs include enterprise environmental factors, organizational process asset, project scope statement, work breakdown structure (WBS) Dictionary (Elyse, 2007). The general purpose of a procurement plan Procurement planning refers to the process of determining what to buy, from what source and when. During the process of procurement planning, the method of procurement is assigned. The procurement fulfilment expectations for procurement requirements are also determined. Procurement plans help individuals to procure services and products from external suppliers. The procurement plan provides a template for project procurement that is complete.
Proper and careful planning for business procurement ensures that one buys the right products for their business. Procurement and tendering go hand in hand. At the tender time, consultants should refrain from proposal submission without an intention that is firm (Project Procurement Management Module 2, 1969).