ABSTRACT
Procurement management involves the process of acquiring the necessary equipment, tools, goods, services, and resources needed to successfully accomplish project goals. As the quote in the chapter opening suggests, it is alright to speculate about the needs of a project in order to acquire and accumulate the resources needed for the project. Procurement is also often called acquisition, purchasing, or contracting. This represents the process of acquiring (through contracting) products, results, or services for direct usage on a project. Recall that the end results of a project fall in three major categories of
Products• Services• Results•
Procurement is needed as a formal process of obtaining the above from a vendor or supplier whether the products or services are already in existence or must be newly designed, developed, tested, or demonstrated. Procurement involves all aspects of contract administration during the project life cycle (PMI, 2004). The buy, lease, or make options available to the project must be evaluated with respect to time, cost, and technical performance requirements. Contractual agreements, in written or unwritten (verbal) format, constitute the legal document that defi nes work obligation of each participant in a project. Procurement refers to the actual process of obtaining the needed services and resources. A contract, within the context of project procurement, is a mutually binding agreement that obligates the vendor to provide the specifi ed products, services, or results and obligates the buyer to provide monetary return for the contract rendered. The procurement cycle occurs at the projectsupplier interface and covers all processes necessary to ensure that materials are available for executing the project schedule. The supply chain networking becomes very essential during the procurement cycle.
