An Introduction to the

Procurement Process
How  to  use  a  professional  approach  
to  procurement  to  reduce  risk  and  
get  best  value  for  money  
What is covered?

•  In  the  next  10  minutes  we  will  show  you:  

–  How  to  hit  the  ground  running  by  using  a  
professional  process  template  
–  How  to  avoid  many  of  the  procurement  pi>alls    
–  How  to  deliver  a  professional  standard  
procurement  project  
–  How  to  get  further  support  and  informa@on  for  
free  
Where does this fit?

•  Limited  professional  procurement  support  

–  Small/Medium  sized  organiza@on  
–  Non  core  business  project  
–  Procurement  resource  constrained  
•  Procurement  for  a  highly  technical  project  
–  Highly  specialised  procurement  e.g.  SoIware  
–  Procurement  need  specialist  skills  
•  For  the  procurement  professional  
–  S@ll  on  your  learning  curve  
–  Suppor@ng  non  procurement  people  
Why follow a procurement process?

•  Why  learn  from  your  own  mistakes  when  you  can  

learn  from  others’  mistakes  
•  The  process  template  gives  a  framework  to  work  
within  
–  Save  @me  
–  Avoid  acquiring  the  wrong  solu@on  to  a  problem  
–  Pay  the  right  price  
–  Avoid  overlooking  vital  steps  in  the  process  
•  Poten@al  suppliers  know  what  to  expect  
•  Minimize  the  risk  of  making  a  costly  mistake  
A few words of warning

•  Every  project  is  different  

•  Some  projects  are  very  easy  
•  Some  projects  are  highly  complex  or  regulated  
•  All  procurement  follows  the  same  broad  
process  
•  Let  common  sense  prevail  
 1.    
Define  
Business  
Need  

Iden@fy  Business    
1.1   Requirement  
Knowledge    
1.2   Capture  

Stakeholder    
1.3   Consulta@on  

1.4  
Risk    
Assessment  

1.5  
Scope  and  
Communica@on  

Objectives 1.  Capture the detailed business requirements

2.  Obtain full stakeholder buy in to any resulting plans and
timelines

What you need before you start 1.  Key Contact Details
2.  Basic Business Requirement

Deliverables 1.  Formal Business Requirement statement

2.  Confirmed buy-in.
3.  Rough Budget Estimate
 1.     2.    
Define   Develop  
Business   Procurement  
Need   Strategy  

Team  Kick  
2.1   Off  

Market    
2.2  
Research  

2.3   Define  
Success  

2.4   Agree  
Strategy  

Objectives 1.  Agree procurement timescales

2.  Evaluate current environment (internal and market environments)
and decide on the procurement process

What you need before you start 1.  Formal business requirement statement
2.  Resources identified and committed
3.  Buy-in obtained from all stakeholders

Deliverables 1.  Procurement plan

2.  Detailed estimated budget signed off
3.  Market research
 1.     2.     3.    
Define   Develop   Supplier  
Business   Procurement   Evalua@on  &  
Need   Strategy   Selec@on  

3.1   Develop  Pre-­‐qual  

Strategy  

3.2   Score,  Filter  

&  No@fy  

3.3   Develop  &  

Launch  Tender  

3.4   Assess    
&  Filter  

Objectives
1.  To select the right suppliers and solution to be taken forward to
final negotiation.

What you need before you start 1.  Procurement Strategy agreed and signed off
2.  Market Research

Deliverables 1.  Shortlist of suppliers

2.  An agreed procurement approach with shortlisted suppliers
 1.     2.     3.     4.    
Define   Develop   Supplier   Nego@a@on  
Business   Procurement   Evalua@on  &   and  Award  of  
Need   Strategy   Selec@on   Contract  

4.1   Prepare  Nego@a@on  

Strategy  

4.2   P2P  Design  

4.3  
Conduct  
Nego@a@ons  

4.4   Finalize  
Contract  

4.5  
Award  

Objectives
1.  Complete Negotiations and select best supplier
2.  Award contract

What you need before you start

1.  Filtered List of Suppliers

Deliverables 1.  Agreed Purchase to Pay processes and KPIs

2.  Signed Contract
 1.     2.     3.     4.    
5.  
Define   Develop   Supplier   Nego@a@on  
Induc@on  &  
Business   Procurement   Evalua@on  &   and  Award  of  
Integra@on  
Need   Strategy   Selec@on   Contract  

4.1   Launch  
Supplier  

4.2   Post  Procurement  

Review  

4.3   Con@nuous  
Integra@on  

Objectives 1.  To ensure that the supplier is fully prepared to deliver all aspects of the contract
2.  To ensure that all parties are familiar with agreed P2P policies and procedures
3.  To initiate the relevant performance measures and reporting

1.  Signed contract in place

What you need before you start
2.  P2P policies and processes agreed
3.  SLAs and KPIs agreed and understood

Deliverables
1.  Business Requirement met
For further information
•  Use  the  free  interac@ve  procurement  process  
diagram  at  purchasinginsight.com  

–  Drill  down  into  the  

detailed  sub  tasks  
–  Read  further  guidance  
notes  on  sub  tasks  
–  Simply  click  on  any  
stage  of  the  process  to  
see  further  detail  
–  Revisit  the  process  or  
use  it  as  a  training  tool