Written by Marijn Overvest | Reviewed by Sjoerd Goedhart
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Project Procurement Management Plan Process

Worried about having to make Project Procurement Management Plan? Don’t worry because we have you covered in these 7 steps!

1. Define Roles, Terms, and Agreements

In starting a plan, everyone must know their roles in creating the project. This is to ensure that all parties involved in working the project understand their scope of work. It also defines the boundaries of roles to make sure that no one overlaps with their responsibility. 

One must also identify the terms in a project procurement management plan. You must list what you need to procure to make the project. In creating this, you must also know what service will be provided in the project. 

In defining the agreement, both parties must agree on the terms of their agreement. The type of agreement will decide on how the project will be managed.

2. Scheduling

A project procurement management plan must contain the details of what will be needed in the project. This is to make sure that the procurement process will be completed within your anticipated timeline.

3. Identify and Mitigate Risks

Everything comes with a risk. It is natural in every part of the procurement process. The project procurement management plan figures what risks may come once the project starts. Once a list of possible risks are collected, then you will be able to resolve it immediately.

4. Know the Costs

You need to identify the costs of materials needed in the project procurements. You need to ask for a Request for Quotation (RFQ) to know if the potential costs will match your proposed budget.

5. Make a Decision Criteria

This phase outlines the workflow of each contract. It specifies the parts required before you have the final approval, such as reviewing the proposals by enacting compare proposals and identifying the costs for each one of them. Having decision criteria helps in making sure that all the contracts are reviewed thoroughly before their approval.

6. Create a Vendor Management Plan

This step helps to ensure that goods and services are delivered on time. It also involves invoice management by detailing the processing, status reporting, and timesheet approval.

7. Review the Approval Process

Of course, after settling all the things in a procurement management plan, it must be reviewed. This step explains the processes for approving and reviewing possible changes to be made in the documents. It ensures that only the amendments that have been reviewed and approved will be implemented. 

The Role of the Project Procurement Management Plan

A procurement management plan will define steps that are necessary to manage a certain project within your organization. That’s not all there is to it, though. The procurement management plan also helps the business stakeholders to know what procedures will be taken to manage a project and how it will be conducted, keeping them informed of its status, the objectives of the certain project, and its the overall general process.

By allowing the stakeholders to know the general overview of how the project will be managed, it also ensures that the right products and services will be procured as they will be able to input their expert opinions as to what products or services should be availed of.

On top of that, the procurement management plan will allow you to see the potential holes in the steps to managing your project, allowing you to minimize the risks and losses.

Conclusion

Crafting a project procurement management plan is essential for successful project execution because this guide covers the definition, significance, and steps involved in creating such a plan, helping you see the overall process of project management to ensure there are minimal risks and losses.

This plan will also allow you to have a more accurate and detailed plan, making sure that your project will be executed successfully and efficiently. Because of such plans, your stakeholders will also be able to see the details and input their opinions, which leads to a much more accurate and a higher chance of a successful project management.