The Procurement Process

Written by: Tara Palmer – The Pro Forum Community of Practice

Why is it that so many people think that procurement is such a simple process. I have heard it asked many time, “so you buy things?” Well yes, in layman term YES procurement professionals buy things but it is a much more complicated process than that, especially if you are purchasing with public funds.

There are many steps involved in the procurement process and we will touch on them here.

Firstly, identifying the need. Documenting clear objectives, seeking specialist advice, conducting market research, ensuring probity is a consideration and documenting your decisions and justifications. All of this done with the understanding and incorporation of the Australian Government Transparency Requirements (Read more on the Transparency requirement here t.ly/KyXj ).

The second step of the procurement process is to scope the procurement. This step involves working out if there is a potential for using a coordinated procurement arrangement or making panel arrangements. It might be about asking the question of whether the procurement can be done in conjunction with another department noting value for money. During this stage you will also need to make cost estimates for the procurement, including whole of life costs.

Following on is being able to determine the most appropriate procurement method. There are the common processes of Open Tenders involving one-stage or multi-stages through advertised via AusTender. There are also other options including Limited Tenders. involving approaching tenderers individually. This method can only be used when it is allowed in the CPR’s

Next is the process of preparing the approach to market, including creating a tender evaluation plan that ensures that the process remains true to its initial clearly defined objective that was determined in step one and getting the appropriate delegate approval before approaching the market.

The fifth step is approaching the market. Collating all the necessary information, including draft contracts, editable response forms, statement of requirements along with all relative information so that it can be published/advertised. Ensuring all of the information is available to potential suppliers or providers equally ensures a more transparent process.

We begin to move to the final stages of the procurement process. Once the tender date has been reached and the tender is closed, the evaluations can begin. Working to the criteria set before the procurement opportunity went to market , the evaluation can be time consuming. During this step the procurement team will need to;

Deal with errors in submissions and late tenders ensuring they follow the CPR’s
Need to maintain fairness, probity, and ethics through the process to ensure all tender offers are treated the same.
Handle complaints
Conduct financial viability assessments of suppliers.
Conduct a comprehensive tender evaluation
present findings and recommendations to appropriate delegate for approval
enter into negotiation for first preferred supplier and sign contract
Inform unsuccessful supplier of the tender outcome and potentially perform debriefing sessions for unsuccessful suppliers.
Report successful contract on AusTender (if valued at over $10,000)

Lastly, within the procurement process, there is the requirement to manage the contract or hand over the process to the contract management team. This mayinvolve creating a contract management plan, identifying how to manage potential variations and extensions, as well as monitoring for compliance. These activities need to continue until the end of the contract term or until the contract is terminated.

Procurement is an intricate discipline with significant responsibilities. Its is a role that is responsible for delivering compliant, value for money procurement outcomes. It has to be agile, mobile, resilient, trusted and capable.

This involves skills, knowledge and experience!

Procurement is less about just ‘buying things’ as it is about being a professional able to deliver exactly what is needed and expected in a complex environment.