procurement and whatnot Flashcards
What is outsourcing
- business practice of obtaining goods or services in a company from an external service provider
what is outsourcing used for?
non-fundamental roles
advantages for outsourcing
- expertise not available internally
- reduce operating costs
- free resources for other purposes from non-core activities
Disadvantages for outsourcing
- loss of control
- loss of technical knowledge
- cost of set up & monitoring
Property/Facilities Management’s types of services
- soft services
- hard services
soft services in outsourcing
- Make the workplace more pleasant or secure to work in
- Non-technical services, usually with high user focused outcomes
Hard Services in outsourcing
- Relate to the physical fabric of the building & cannot be removed
- Technical services involving maintenance of systems, equipment & building fabric
outsourcing approaches in project management/facility management
- Increasing trend in many organisations outsourcing works beyond the typical plant operation & maintenance works
what kind of stuff outsourcing do?
- security services
- carpark management
- cleaning
- waste management
- swimming pool services
is there diff between contracting and outsourcing
yea
contracting
- organization procures services or goods from the service provider
- owner has control of the process
- owner tells the service provider exactly what he/she wants and how it is to be
outsourcing
- organization transfers ownership of a business process to a service provider
- owner does not instruct service provider how to perform the tasks but, instead, specifies the performance or outcomes
- how the performance or outcomes are
achieved is within the control of the service provider
Procurement:
process of obtaining goods & services for business use
Procurement management is about
- Finding the right seller to acquire products, services or results
- Choosing the right kind of relationship
- Goals of the contract are met
Plan procurement management
- whether there is need for purchase
- what kind of contract
- how project will be contracted out
- when to contract out
- prepare doc needed to support procurement process
- plan out each individual contract
planning out each individual contract
- how you manage contract
- what metrics it will need to meet to be successful
- how to pick a contractor
- how to administer contract
procurement triangle
highest QUALITY, at lowest COST, in shortest TIME
can there truly be balance in procurement triangle
no, its is not always possible
Quotation
called for minor project
tender
called for major project
how to decide quotation or tender?
- nature
- cost
- technical complexity
- time available
- need for continuity of project
- degree & nature of risk involved
types of procurement
- direct purchase
- verbal quotation
- invitation to quote (ITQ)
- Invitation to Tender (ITT)
Value of Goods or Services To Be Purchased
- direct purchase: less than $500
- verbal quotation: $500 - $6k
- invitation to quote (ITQ): $6k - $70k
- Invitation to Tender (ITT): more than $70k
Method of Procurement
- direct purchase: Direct purchase from supplier/contractor
- verbal quotation: Obtain at least 2 recorded verbal quotations
- invitation to quote (ITQ): Invite at least 3 suppliers or contractors to quote
- Invitation to Tender (ITT): Call for tenders from at least 3 tenderers
up to $5k purchase value
endorsement authority: supervisor
approving authority: manager
Up to $10,000 purchase value
endorsement authority: manager
approving authority: director
Up to $50,000 purchasing value
endorsement authority: director
approving authority: Managing Director
> $50,000 purchase value
endorsement authority: Managing Director
approving authority: procurement committee
Procurement Process
- Proper management of the procurement process can help to improve the profit & reduce the losses of the organisation
- Business fraud & graft often occur during the procurement process
2 phases in the planning phase of the procurement life cycle model.
- pre-contract
- post-contract
pre-contract timeline
- planning
- (client approval)
- calling of tender
- evaluation of offers
- (client relations)
- award contracr
post-contract
contract management
Tender
- procurement process
- involving project’s requests from the external market
- to place proposals on the supply of goods & services to that project
tendering process
- expression of interest (EOI)
- Pre-Q (shortlisting)
- Invitation to tender
- site show round
- submission of offer
so how is a building project done?
- needs
- appoint consultants
- concept design by architect, estimate of construction cost by QS
- owner approval
- prepare drawing, specifications & tender doc by consultants
- pre-qualification of tenders
- site showround, architect present
- collection of tender docs
- tender close
- evaluate tender
- tender recommendation
- approval of successful tenderer
- acceptance of tenderer
- contract commencement
- construction
- certified completion
- handover
- maintenance
In receiving & handling bids during tendering process, it is important
to ensure…
- process is open & transparent
- no conflict of interest
- confidentiality, integrity of non-disclosure
Tendering Process
- media ads
- organizational website
- sesami
- GeBiz
tendering
- invitation letter
- media advertisement
- electronic
invitation letter
- Quick & more specific
- Good for relatively small no. of tenderers
- Usually for small value or simple service
Media Advertisement
- able to reach more tenderers
- good for more standard with many such tenderers available
- For common goods & services, may need more time to process
Electronic
- Easy & quick to inform tenderer
- Good for disseminating large amount of information at a short period of time
- Need a higher capital outlay from the tenderers, able to reach the more
financially strong & established tenderer since tenderer has to have infrastructure to gain access
What Is Government Procurement
It is the acquisition of goods and services via contract by Ministries, Departments,
Organs of State and Statutory Boards
who is in charge of GP
ministry of finance
Small Value Purchase(SVP)
• Not more than $6,000.00
• No need to issue Purchase Order
How to source for small value purchases?
- written letters
- GeBiz
Quotation
$6,000.00 - $90,000.00
Sourcing for Quotation
- Open Quotation
- Invitation to Quote (ITQ) or Limited Quotation
- Direct Contracting
Open Quotation
• Issue toa minimum of three (3) contractors/suppliers
• Provided the Terms & Conditions of Purchases are posted clearly
Sourcing for Open Quotation
- Posting On GeBIZ
- Get Price List / Catalogues
Ads for open quotation
• Quotation Opening Period shall not be less than 7 working days including the day on which the quotation is called
➢ should have reasonable period of time to let interested contractors/suppliers submit a quotation
• closing date shall be on a working day
• if got exigencies, shortening of Quotation Opening Period need approval of at least a Director (or equivalent)
• No shortening is allowed once Quotation Notice is published or issued.
