Ch11

Question 1

______________ means acquiring goods and/or services from an outside source

Answer 1

Procurement

Question 2

Fact: Other terms include purchasing and outsourcing

Question 3

Why Outsource?

Answer 3

• To reduce both fixed and recurrent costs
• To allow the client organization to focus on its core business
• To access skills and technologies
• To provide flexibility
• To increase accountability

Question 4

_______________: determining what to procure and when

Answer 4

Procurement planning

Question 5

__________________: documenting product
requirements and identifying potential sources

Answer 5

Solicitation planning

Question 6

____________: obtaining quotations, bids, offers, or
proposals as appropriate

Answer 6

Solicitation

Question 7

________________ choosing from among potential
vendors

Answer 7

Source selection:

Question 8

______________: managing the relationship
with the vendor

Answer 8

Contract administration

Question 9

_______________completion and settlement of the
contract

Answer 9

Contract close-out

Question 10

Project Procurement Management Processes

Answer 10

Procurement planning
Solicitation planning
Solicitation
Source selection
Contract administration
Contract close-out

Question 11

_________________involves identifying
which project needs can be best met by using
products or services outside the organization.

Answer 11

Procurement planning

Question 12

Procurement planning It includes deciding

Answer 12

whether to procure
how to procure
what to procure
how much to procure
when to procure

Question 13

T/F: Several organizations, even competitors, have
found that it makes sense to collaborate on
procurement for some projects

Answer 13

T

Question 14

Fact: Kodak worked with several competitors to
develop the Advantix Advanced Photo System

Question 15

Procurement Planning Tools and Techniques

Answer 15

Make-or-buy analysis

Experts

Question 16

_________________: determining whether a
particular product or service should be made or
performed inside the organization or purchased
from someone else. Often involves financial
analysis

Answer 16

Make-or-buy analysis

Question 17

________, both internal and external, can provide
valuable inputs in procurement decisions

Answer 17

Experts

Question 18

Slid9,10

Question 19

Types of Contracts

Answer 19

Fixed price or lump sum
Cost reimbursable
Time and material contracts
Unit price contracts

Question 20

_________________: involve a fixed total price
for a well-defined product or service

Answer 20

Fixed price or lump sum

Question 21

______________: involve payment to the seller for
direct and indirect costs

Answer 21

Cost reimbursable

Question 22

______________________: hybrid of both fixed
price and cost reimbursable, often used by consultants

Answer 22

Time and material contracts

Question 23

___________________: require the buyer to pay the
seller a predetermined amount per unit of service

Answer 23

Unit price contracts

Question 24

Cost Reimbursable Contracts

Answer 24

Cost plus incentive fee (CPIF)
Cost plus fixed fee (CPFF)
Cost plus percentage of costs (CPPC)

Question 25

Solicitation planning involves preparing several documents:

Answer 25

Request for Proposals Requests for Quotes

Question 26

____________: used to solicit proposals from prospective sellers where there are several ways to meet the sellers’ needs

Answer 26

Request for Proposals

Question 27

_______________: It is a document issued when an organization wants to buy something and chooses to make the specifications available to many other companies so they can submit competitive bids. It is used to solicit quotes for well-defined procurements

Answer 27

Requests for Quotes

Question 28

Fact: Invitations for bid or negotiation and initial contractor responses are also part of solicitation planning

Question 29

_____________ involves obtaining proposals or bids from prospective sellers

Answer 29

Solicitation

Question 30

Organizations can advertise to procure goods and services in several ways

Answer 30

– approaching the preferred vendor – approaching several potential vendors – advertising to anyone interested

Question 31

Fact: A bidders’ conference can help clarify the buyer’s expectations

Question 32

Source selection involves

Answer 32

– evaluating bidders’ proposals – choosing the best one – negotiating the contract – awarding the contract

Question 33

Fact: • It is helpful to prepare formal evaluation procedures for selecting vendors • Buyers often create a “short list”

Question 34

Many dot-com companies were created to meet potential market needs, but many went out of business, mainly due to ..

Answer 34

poor business planning, lack of senior management operations experience, lack of leadership, and lack of visions. Check the stability of suppliers

Question 35

T/F: Even well-known suppliers can impede project success.

Answer 35

T

Question 36

Fact: Be sure to write and manage contracts well with all suppliers .

Question 37

_____________ ensures that the seller’s performance meets contractual requirements

Answer 37

Contract Administration

Question 38

Fact: Contracts are legal relationships, so it is important that legal and contracting professionals be involved in writing and administering contracts

Question 39

T/F: Many project managers interest in contractual issues, which can result in serious problems

Answer 39

F: ignore contractual

Question 40

Slid21

Question 41

Contract close-out includes

Answer 41

– product verification to determine if all work was completed correctly and satisfactorily – administrative activities to update records to reflect final results – archiving information for future use

Question 42

Fact: Procurement audits identify lessons learned in the procurement process

Question 43

Slid 23

Question 44

__________ : something that encourages you to do something.

Answer 44

Incentive

Question 45

__________: An amount of money that is paid at one time, not on separate occasions.

Answer 45

Lump-sum

Question 46

____: To offer to pay a particular price for something.

Answer 46

Bid

Question 47

_____________: To pay back money to somebody which they have spent or lost.

Answer 47

Reimburse

Question 48

___________: To ask somebody for something, such as support, money, or information.

Answer 48

Solicit