Chapter 45: Procurement Management Plan

In the previous chapter, we learnt that the outcome of the procurement planning process is the procurement management plan. In this chapter, we are going to understand what this document is.

So, lets get started!!!

What is Procurement Management Plan?

This document describes how the procurement will be managed throughout the project. The plan includes the following:

• How the make-or-buy decisions will be made and handled
• Contracts

o What types of contracts will be used for this project
o The form and format for the statement of work related to a procurement or a contract
o Metrics to be used to evaluate potential sellers and to manage contracts
o Requirements for performance bonds or insurance contracts that might be put in place to mitigate some project risks

• Management and coordination

o How to manage multiple sellers.
o How to coordinate procurement with other aspects of the project, such as the project schedule, scope, budget, and status progress reporting.
o Evaluation criteria for selecting sellers and measuring their performance. It is also called source selection criteria and will be covered in depth in future when we learn about conducting the actual procurements.

• A list of assumptions and constraints that could affect the procurement
• Any needed standardized procurement documents

In a nutshell, the major tasks of procurement planning are making make-or-buy decisions, preparing the procurement management plan, preparing the statement of work, determining a suitable type of contract, and preparing or acquiring the procurement documents. Once you have these elements in place, you are ready to implement the procurement plan, which will be discussed very soon…

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