Purchasing and Procurement Processes: Module Four

Purchasing and
Procurement Processes
Module Four
Revision Date: 2/06/2015
1
Course Overview & Learning Objectives
Course Expectations
Training Approach & Participation Protocol
COURSE INTRODUCTION
2
Mutual Respect
General guidelines for online meetings:
Interact
Engage
Participate
3
© WA Department of Enterprise Services
Training Credit
To complete the module and receive credit,

you will be expected to achieve a 80% on
the module assessment . Employees should
log into LMS to complete each module
assessment. Use of the participant
workbook is encouraged in the assessment!
4
Course Overview
Course will be delivered in four modules:
 Module 1: Purchasing & Procurement
Overview
 Module 2: Choosing a Route for Purchases of
Goods and Procurement of Services
 Module 3: Competitive Procurements,
Amendments, and Exemptions
 Module 4: Purchasing & Procurement
Processes
5
Module Overview
Section Section Section

One Two Three
The Planning Solicitation and

Post-Procurement
Process Selection
6
Learning Objectives
As a result of this training participants will be able
to:
 Identify purchasing and procurement needs and

outcomes
 Describe the importance of communicating need
within the agency
 Identify scope, timeline, requirements and vendors as
part of the planning process
 Discuss how to evaluate and select a vendor
 Apply the purchasing and procurement planning
phases
7
Identify the Need and Outcomes
Communicate Need Within Agency
Identify Scope, Timeline and Requirements
Identify Vendors
Define Scope and/or Statement of Work
THE PLANNING PROCESS
8
Procurement Steps
Planning Phase 1. Identify the Need and Outcomes
2. Communicate Need Within Agency
3. Identify Scope, Timeline and Requirements
4. Identify Vendors
5. Define Scope and/or Statement of Work
6. Communicate Formal Need With Vendors

& Selection
Solicitation
7. Evaluate Vendors
8. Select Vendor
Procurement
9. Negotiate Contract
Post
10. Contract Execution and Management
9
Collaboration and Planning
Collaboration is important – Work with

Business Owners, Subject Matter Experts
and Stakeholders
10
Step 1
Why does your agency purchase goods

and services?
11
Step 1
Critical Thinking & Outcomes of a Purchase
or Procurement
Identify Identify
Outcomes Need
Identify
Evaluate &
Alternatives
Analyze
Available
12
Communicate Agency Need
Step 2
2. Engage
4. Determine
SMEs,
1. Initiate 3. Conduct checkpoints
business
planning independent and
owner and
process research delegated
other
authority
stakeholders
13
Purchasing vs. Procurement
 Purchasing - the process of obtaining goods and

services for the State of Washington.
 Procurement - the combined functions of identifying

needs, initiating a procurement project, selecting a
vendor, contracting with a vendor, purchasing of the
goods or services, managing the resulting contract.
14
Identify Scope, Requirements
and Timeline
Step 3
Identify and define the scope and

overall contract timeline
15
and Timeline
Step 3
High-level Contract
Contract Contractor
Functional Responsibilities Phases &
Purpose
Areas Timeline
What is
NOT in
Scope?
16
and Timeline
Step 3
Common Pitfalls in Scope of
Work/Requirements Writing
• Too strict and rigid

• Not enough details
• Written to a certain vendor or solution
• Outdated or obsolete requirements
17
Identify Vendors
Step 4
2. Knowledge of
1. DES Vendor
Vendor
Lists
Marketplace
3. Vendor Pre-
4. Other
Bid
Sources
Communication
18
Define Scope and/or Statement
of Work
Step 5
Scope or Work vs. Statement of Work
19
Define Statement of Work
Step 5
Requirements
&
Specifications
Performance Project
Standards History &
Objectives
Statement
Reporting of Work
Requirement Deliverables
s
Schedule Milestones
20
Communicate Formal Need With Vendors
Evaluate Vendors
Select Vendor
SOLICITATION AND SELECTION
21
Procurement Steps
4. Identify Vendors

& Selection
Solicitation
7. Evaluate Vendors
8. Select Vendor
Procurement
Post
22
Communicate Formal Need to
Vendors
Step 6
Request For
Quote
/Quotation
OR
Qualifications
(RFQ)
Request For
Communicate Proposal
(RFP)/Request
for Bids (RFB)
Request For
Qualifications
and
Quotation
(RFQQ)
23
Communicate Formal Need with
Vendors
Step 6
Solicitation Need RFQ RFQQ RFP/RFB
Standard, Ongoing Purchase X X
Many Vendors Offer This X X
Cost is the Most Important Factor X
Vendor Qualifications and
Performance Important in Addition to X X
Cost
Vendor Specialization / Few Offer This X
Complex Project Needs X
Solution Required to Meet Need X
24
Vendors
Step 6
Assign Draft Solicitation Issue Solicitation Receive Bids

Procurement Content
Coordinator
• Define list of • Requirements • Use WEBS • Document

potential vendors tailored to level of • Post Amendments date/time
• Encourage WEBS complexity on WEBS • Maintain
registration confidentiality
25
Vendors
Step 6
Evaluate Costs Award Post Results Negotiate &

/Rates Award Contract
• WEBS • Conduct
• Rank based on • Lowest cost, Debriefings
lowest cost or responsive • Notify
successful & • Negotiate &
rate bidder award the
unsuccessful
Bidders contract
26
Vendors - Step 6
Select Team Draft Finalize and Post Release

RFP/RFB Release Activities
Content RFP/RFB
• Establish Team • Project approach • Stakeholders • Respond to

Roles and methodology review draft RFP Bidder questions
• Write • Finalize Scope of • Finalize RFP for • Draft
Specifications Work release amendments or
• Identify RFP/RFB • Outcomes and • Post and publish addendums
Coordinator for the Performance RFP
project Measures
• Score and rank • Deliverables and
Bids milestones
• Management and
staffing plan
• Bidder responses
format
• Cost response Evaluation
format
Process
(Step 7)
27
Communicate Formal Need w/
Vendors - Cost Sheets
Step 6
Vendor Name Cost Vendor Name Deliverable
Cost
Time
Deliverable A
Materials Deliverable B
Total: Deliverable C
Total:
Vendor Hourly Hours Total

Name Rate
Staff level
Total:
28
Evaluate Vendors
Step 7
Evaluation Objectives
 Provide clear direction and guidance

 Ensure integrity of fair evaluation process
 Create a documented process
 Recommend for contract award
29
Evaluate Vendors
Step 7
Evaluation Step Considerations
 Confidentiality and Security

 Conflict of Interest
 Evaluation Milestones
 Evaluator Availability?
30
Evaluate Vendors
Step 7
Evaluation Roles include ….
Procurement Evaluation Executive

Coordinator Committee Sponsorship
• Ensure • Evaluate • Supports &
Adherence • Score Authorizes
• Prepare & • Controls
Distribute Expenditures
31
Evaluate Vendors
Step 7
• Initial Screening
Phase 1
• Evaluation of Technical
and Management
Phase 2 Response
• Oral Presentations (if

applicable)
Phase 3
• Evaluation of Cost
Proposals
Phase 4
• Best and Final Offers

(BAFO)
Phase 5
• Ranking of
Proposals
Phase 6
32
Evaluate Vendors
Step 7
Technical Evaluation
Points
Technical Evaluation Criteria (Weighted
Score)
1 Executive Summary (75 points max) and 100
Vendor Identifying Information (25 points
max)
2 Qualifications of Firm (300 points max) 300
3 Approach to Scope of Work (300 points 300
max)
4 Qualifications of Proposed Key 200
Personnel (200 points max)
5 Corporate References (100 points max) 100
6 Total Weighted Score 1000
33
Evaluate Vendors
Step 7
Cost Evaluations
Vendor Name Cost

Vendor A $150,000
Vendor B $175,000
Vendor C $180,000
34
Evaluate Vendors
Step 7
Cost Evaluation
Cost Vendor A Vendor B Vendor C
Componen
t
Supplies $50,000 $60,000 $70,000
Staff $50,000 $90,000 $90,000
Administrative $20,000 $5,000 $5,000

Expenses
Profit/Overhead $30,000 $20,000 $15,000
Total $150,000 $175,000 $180,000
35
Select Vendor
Step 8
Once the evaluation is complete
Award to Highest Scoring Bidder

OR
Reject all Bids or Re-Issue the Solicitation
36
Select Vendor
Step 8
Once all bidders have been notified, conduct

debriefings if requested.
Following the award, as you get ready to

negotiate and establish a contract make
sure the solicitation files are complete.
37
Negotiate Contract
Contract Execution and Management
POST-PROCUREMENT
38
Procurement Steps
4. Identify Vendors

& Selection
Solicitation
7. Evaluate Vendors
8. Select Vendor
Procurement
Post
39
Negotiate Contract
Step 9
Conduct Edit Finalize

Baseline contract and Route Contract
Contract based on for Starts
Review proposal Signatures
40
Contract Execution and
Management Transition
Step 10
Contract Project
Contract Initial Kick-
Management
Execution off Meeting Management
Framework
41
Contract Execution and
Management Transition
Step 10
Compliance
with T&C Approve
Risk Contractor
Mitigation Invoices
Schedule
Monitoring
Ongoing Contract
Management
42
Summary & Key Points
 Identified purchasing and procurement needs and
outcomes
 Described the importance of communicating need
within the agency
 Identified scope, requirements and timeline, and
vendors as part of the planning process
 Discussed how to evaluate and select a vendor
 Applied the purchasing and procurement planning
phases
43
Next Steps
 Complete test and achieve 80% or higher

 Complete evaluation form
44
Questions after the training? Call Cheryl Shaw at (360) 407-9376.
QUESTIONS
45

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Purchasing and

To complete the module and receive credit,

Section Section Section

The Planning Solicitation and

 Identify purchasing and procurement needs and

THE PLANNING PROCESS

2. Communicate Need Within Agency

3. Identify Scope, Timeline and Requirements

5. Define Scope and/or Statement of Work

6. Communicate Formal Need With Vendors

10. Contract Execution and Management

Collaboration is important – Work with

Why does your agency purchase goods

 Purchasing - the process of obtaining goods and

 Procurement - the combined functions of identifying

Identify and define the scope and

• Too strict and rigid

Scope or Work vs. Statement of Work

SOLICITATION AND SELECTION

2. Communicate Need Within Agency

3. Identify Scope, Timeline and Requirements

5. Define Scope and/or Statement of Work

6. Communicate Formal Need With Vendors

10. Contract Execution and Management

Assign Draft Solicitation Issue Solicitation Receive Bids

• Define list of • Requirements • Use WEBS • Document

Evaluate Costs Award Post Results Negotiate &

Select Team Draft Finalize and Post Release

• Establish Team • Project approach • Stakeholders • Respond to

Vendor Hourly Hours Total

 Provide clear direction and guidance

 Confidentiality and Security

Procurement Evaluation Executive

• Oral Presentations (if

• Best and Final Offers

Vendor Name Cost

Staff $50,000 $90,000 $90,000

Administrative $20,000 $5,000 $5,000

Total $150,000 $175,000 $180,000

Award to Highest Scoring Bidder

Once all bidders have been notified, conduct

Following the award, as you get ready to

2. Communicate Need Within Agency

3. Identify Scope, Timeline and Requirements

5. Define Scope and/or Statement of Work

6. Communicate Formal Need With Vendors

10. Contract Execution and Management

Conduct Edit Finalize

 Complete test and achieve 80% or higher

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