I’m studying for my Management class and need an explanation.
Please reply to both POST1: and POST2: in at least 200 words each
- How and why does procurement contribute to the success of a project or project-based organization?
- What are some procurement-related factors that support project success?
- What are some procurement-related factors that lead to project failure?
According to Baily, Framer, Crocker, Jessop, & Jones (2015), “procurement is the acquisition and purchase of goods and services” (p.1). Procurement is an essential function of any project. As such, project managers must be able to manage their project procurement. The PMI (2017) states that “Project Procurement Management includes the processes necessary to purchase or acquire products, services, or results needed from outside the project team” (p. 495). Without proper procurement management, project managers may find that their projects are hindered by a lack of materials and/or services.
Procurement-Related Factors that Support Project Success
Numerous procurement-related factors support project success. These factors include the following:
- A clear understanding of project goals and challenges
- Focusing on all applicable factors when selecting products and/or services
- Effectively sourcing and selection of vendors (Lindstrom, 2014)
Procurement-Related Factors that Lead to Project Failure
Many procurement-related factors may lead to project failures. These factors include:
- Failure to understand, recognize, and plan for project goals and challenges
- Focusing product and/or service selection solely on cost and/or short-term solutions
- Failure to properly source and select vendors (Lindstrom, 2014)
Baily, P., Farmer, D., Crocker, B., Jessop, D., & Jones, D. (2015). Procurement, principles, & management (11th ed.). United Kingdom: Pearson (Intl) Inc. Hardback ISBN: 978111813009
Lindstrom, D. L. (2014). Procurement project management success: Achieving a higher level of effectiveness. J. Ross Publishing.
Project Management Institute. (2017). A guide to the project management body of knowledge (PMBOK® Guide) (6th ed.). Newton Square, PA: PMI Publications
The function of procurement management is just as important to a project, like any other part of project execution. Procurement management is the process of obtaining services, products or results from outside the formal project team (PMI, 2017). This process involves determining project requirements, researching different vendors and the products they supply, along with gathering information, quotes, and proposals from suppliers to determine which vendor will best meet the project requirements. Research by Depaoli, Sorrentino, & De (2013) states that procurement management is one the most critical areas in project management due to the wide scope of elements, such as planning, organization, leading, communicating, staffing and controlling.
When an organization does not have a defined procurement plan management or does not follow strategies for success, their projects ultimately suffer from budget overruns, inferior products or services, and difficult vendor relationships. A well-defined plan by the organization will lead to successful overall projects in factors like cost, time and quality. An organization that uses a well-defined procurement management plan will have more success with project execution.
Depaoli, Paolo & Sorrentino, Maddalena & De Marco, Marco. (2013). Depaoli, P. Sorrentino M., De Marco M.(2013), “Publicness and organizational theory Building: opening the black box” in Atti del Convegno del Bicentenario AIDEA, Lecce 19-21 Settembre.
Project Management Institute. (2017). A guide to the project management body of knowledge (PMBOK® Guide) (6th ed.). Newton Square, PA: PMI Publications.