Procurement has become one of the essential requirements when building or setting up a certain project. Procurement involves the processes or activities that are required to ensure that a certain product or service meets the threshold or the requirement of the user.
I have been accorded the opportunity to prepare a report that covers on various aspects related to procurements and in particular the procurement to build a new auditorium at the Heriot Watt University in Dubai campus.
The auditorium will comprise 800 seats, high specification technology, multimedia theatre with air conditioning, and a comfortable tiered seating that provides excellent visibility. The auditorium will also feature a full sise interactive screen and computer driven presentation facilities, perfect for conferences, lectures, and presentations.
Strategic Approach to Procurement
In such a project, strategic approach to procurement is vital in ensuring that the project is concluded as required. This approach is appropriate for the Heriot Watt University because it will ensure achievement of money value. Appropriate procurement measures are critical in ensuring that the project is well managed and completed within the stipulated time using the available resources.
This project is a long-term one because of the complexities involved in it. Therefore, the statement of the program activities, all actions, and other initiatives that Heriot Watt university wants done must be well stated and included in the procurement documentation.
Furthermore, this strategic approach will provide in detail the delivery model that shows how the actions will be done to ensure a smooth implementation of the project and its understanding. In this stage, all the activities that have already been cleared or approved by the university will be noted down and appropriate models applied to ensure that the project becomes a success.
Furthermore, appropriate models to maintain an efficient and effective experience will be documented and looked into at this strategic approach stage (Yeow, & Edler 2012, p. 472). Documentation of the relevant issues pertaining to the project will be undertaken by competent procurement managers to plan and organise all the materials and resources required for completion of the project.
This information will be used for future referencing and accountability on the use of materials during the building process. It is also important to note that every procurement activity approved by an organisation has some negative implication on the environment.
Developing a strategic approach to set up the required auditorium makes the university have a chance of spending its money wisely while at the same time putting considerations on environment. Therefore, to ensure that procurement is done in the right way, I would develop my strategic approach by first identifying and gaining a full understanding of the activities that are required to be done.
This will come at the planning stage whereby, as indicated, I will identify the specifications or the requirements of the auditorium. After gaining understanding of what is required, I will then consider or think about the suppliers of the materials that the project will consume for its completion.
Being aware of the suppliers is important in the whole process of procurement because it will determine whether the project will be completed within the stipulated time using the available resources. It will give an overview of whether there is need for addition of more resources.
The next stage is to reflect on the associated risks and nature and quality of the building itself. The risks that may interfere with successful completion of the project will be factored in to determine how they will be handled. Materials should be of high quality to meet the standards of the university. These very important issues will be put into consideration during the process of strategic approach to procurement.
Critical analysis of alternative procurement routes/types for the proposed project
For a project to be successful, selection of proper procurement route is necessary. In the selection of a procurement route, various issues are considered. These include the contract regulation, pre-qualification of the contractor, procedure of procurement, contract model incentive mechanisms, and the compensation model. There are various alternative procurement routes for the proposed project.
One of the alternatives is the selection of a procurement route based on the recommended practices. This requires the owner to identify the procurement route used. This kind of selection of a project is good because it influences the level of cooperation between the contractor and the owner of the project. This route ensures that the individual responsible for a certain risk is quickly identified.
Therefore, this helps to avoid any blame game in the organisational context. For instance, in this proposed project, the owner of the project, Heriot Watt University, can enter an agreement with the contractor-the individuals required to set up the projects.
Therefore, in case the project becomes impossible to complete or simply stall, the blame can be directed to any of the party perceived to be the cause of the risk. Another alternative is whereby the owner makes decisions based on those things or ideas he/she feels or deems to be important. This therefore leaves the discretion of making a decision to the project owner.
In this project, the best procurement route to be used is the Private Financial Initiative /Public-Private Partnership. In the recent past, the Private Financial Initiative has broadened into a wider spectrum to public –Private partnerships.
This route is one of the complex and most innovative in the procurement process. It involves two entities, a public sector body and a private sector consortium reaching a consensus agreement. In this case, Heriot Watt University will have to enter an agreement with the company that will put in place the infrastructure needed.
In this route, procurement of services that the company will provide is made and not the buildings or infrastructure. Therefore, Heriot University will have to procure the services that it needs to be done. The agreement will therefore be based on the services and not the building.
The private finance initiative/ public-private partnerships scheme that will be reached will involve the construction of infrastructures and buildings to facilitate the private sectors to provide or offer the services that are required by Heriot University. This arrangement may last for a long period averaging to between 20 to 30 years.
Therefore, Heriot Watt University will use this route because it ensures that all the requirements are available until the project is completed within the stipulate time. The private sector, which will be required to complete the project, therefore, will have to form a project consortium that will be specific and aimed at organising the financing, the designing, and finally, the construction of the auditorium.
Like any other project, choosing either of the two has some challenges that one needs to expect. In this case, the owner of the project is the university, which has the discretion to select a project that best appeases it and one which can be completed within the stipulated time (Sandra 2012, p. 96).
Examination of advanced procurement practices suitable for the project procurement process is very important in the smooth operation of the business. Some of the considerations when it comes to effective and advanced procurement practices include consideration of integrity, fairness, competition, and transparency. The process of procurement should be transparent, fair, and open to boost the confidence and truth of the contractors.
For this to be achieved, rules and procedures should be established to guide the process of procurement. These rules should apply to all the parties or competitors who have developed interest in the project. Without such considerations and arguments, it means that their will be still a lot of mix up between the owner and the contractors (Sandra 2012, p. 96). Furthermore, the project should demonstrate economy and effectiveness.
It should provide solutions to the organisation’s needs in terms of quality, quantity, and the time span, all of which should be right and to the set standards. The overall costs of carrying out the project should also be calculated, as well as the time, which the project should come to conclusion. Economy is vital since it helps to protect the interest of the budget owners.
On the other hand, effectiveness is vital because it helps in achievement of the interests of the users or the owners of the project. Therefore, in this project, the contractor and the manager should reach a decisive conclusion. Other suitable advanced procurement approaches suitable for the project is putting into consideration any potential conflicts present in the guiding principles.
Even though these principles are important when they enhance/promote provision of services, sometimes, individuals may clash hence requiring management and professional management to intervene in the situation. This conflict may arise due to the failure to honor the agreements in the contracts or due to misunderstanding between the various parties involved in the procurement process.
Therefore, it is imperative that such factors are considered when engaging in procurement to ensure that transition period is effective and efficient (Kedar, Faith, Berit 2011, p. 73). The project also requires segregation of duties among different employees to ensure that the project is completed within the required time besides achieving its required standards.
Segregation of duties ensures that every individual is responsible for the mistakes made. It further helps to provide professionalism in areas that an individual is trained in to avoid any conflict of interest. This advanced procurement approach is of significant contribution in this project. For instance, the work of building the auditorium involves many other things that construction specialists may not perform.
Therefore, these areas should be assigned to other individuals who possess relevant skills in those specific areas. Delegation of authority is yet another advanced procurement practices that can be adopted in this proposal. Delegation of duties is a form of power granted to someone to give directive that a certain group is supposed to obey.
The project manager or the contractors will assign some of the responsibilities to the contractor to ensure that the project is finalised within the stipulated time. Delegation is also important in procurement because it ensures that materials are available within the right time hence making the progress of a project smooth.
An evaluation of what factors would influence the development of an appropriate Procurement strategy and its implementation
Various factors would influence the development of an appropriate procurement strategy. One of these is transparency of the tendering process. When the procurement process is more open, transparent, impartial, and cost effective, it ensures that the process is competitive, free, and fair. All the interested parties are given equal chances to bid for the projects.
Therefore, the best contractor can win the contract in a fair way (Kedar, Faith, Berit 2011, p. 74). This can be implemented in the organisation through restructuring the process of procurement and coming up with new policies and rules that can foster or promote transparency. In case the project is very complicated, it requires a lot of scrutiny and screening of various applicants to determine the best contractor to carry out the project.
Other factors include the skills and knowledge of the contractor, the person presenting a proposal, or the person to be assigned the duty of procuring materials for the project. Procurement is a vey length process that requires an individual procuring such like a project of building an auditorium to have enough skills, knowledge, and even experience about it.
The process of procurement is also lengthy, as it involves various things such as planning, which involves identification of any issues concerning the project. Therefore, a contractor should understand the various stages that are involved in procurement to tender an application for consideration.
This can be implemented in various organisations by requiring that any applicant or a person procuring such projects should satisfy the things, for instance, having adequate experience in building besides being a critical thinker. Another factor is operation and improved communication. In the day-to-day activities, people fail to meet their objectives and goals due to the failure to engage in communication.
Communication is the medium through which individuals communicate and share their ideas, views, and opinions. Therefore, in projects, setting up communication is essential and therefore needs to be used appropriately by the people. When communication between different parties in the project is perfect, the whole process of procurement is likely to be a success (Adomavicius, Gupta, Sanyal 2012, p. 199).
For instance, communication between the contractor and the owner, procurement officer and the contractor, and the staff should be understood and enhanced to foster unity and teamwork for the tasks assigned to be completed quickly. This can be implemented in the organisation setting if it is absent through education and creating awareness among procurement officers.
Another factor that would influence the development of an effective procurement strategy is the level of training of the parties involved in the process of procurement. Training is important in ensuring that an individual can perform tasks in accordance to the expected standards. This can be implemented by training those who might not have attained sufficient training on procurements and or issues relating to procurement.
Furthermore, enhanced accountability through work delegation is another factor that can influence or affect the development of an effective procurement strategy.
When people in an organisation are accountable, they behave in different ways for the fear of facing harsh treatment. This is likely to ensure that work and tasks are well performed. This can however be implemented in any relationships between the contractor and the supervisors systematically until the task ends.
Potential benefits of adopting alternative procurement strategies
Several benefits result from adapting various alternatives of procurement strategies. One of the benefits is that it helps the procurement officer to adjust the strategy besides making it fit certain requirements to meet certain desired outcomes. For instance, an organisation may have different plans, which may then be changed or improved to change or enable the realisation of the intended objectives.
For instance, in this case, the procurement manager may opt to use negotiation. The owner approaches the procurement officers or department without having to advertise for tenders from other procurement officers. Biding can also be used whereby the owner and procurement officers or departments engage in talks with the winner of the tender getting the opportunity to carry out or continue with the project.
Alternative procurement strategies help to ensure continuous improvement in the procurements functions of an organisation (Walker, Brammer 2012, p. 256).
The plans that are produced by changing or alternating these procurement processes help in continuous improvement in terms of procurement processes, which are critical in advancing the process of procurement within an organisation or between the contractor and the owner of the project. They also help to maintain effective risk management.
In any procurement process, various inherent risks exist that the whole process faces concerning ethical, legal issues, and transparent among many other important issues (Adomavicius, Gupta, Sanyal 2012, p. 199). By adapting alternative procurement methods and processes, such risks are mitigated.
For instance, in this case of building an auditorium house, the contractor may not be aware of the various risks such as the attitude of the staff, which may at some point cause them to lower their tools hence affecting the overall functioning of the procurement departments. Such issues can be solved by opting for other new procurements processes that can provide positive results to enhance cooperation.
Another potential benefit is that the plans help to create an understanding of the nature of activities that are performed or carried out within a certain period. The level of complexity of the issue at hand, the scale or the size of the activity, and the scope of the clarity of the project can be identified and corrected. Therefore, to this end, it is imperative for procurement officers to carry out their tasks diligently to achieve the desired goals.
In conclusion, the procurement process of building the auditorium has some challenges. I have learned that the only way that a procurement process can be achieved satisfying the two parties-the owner of the house and the contractor-is through a clear communication. The procurement steps are many and should be accomplished one by one to ensure that the goals of an organisation are achieved exemplarily.
Any approved procurement strategy should employ a mix of approaches to meet the outcomes or the goals of an organisation to meet the value of money objective.
It is also vital for the approved organisation to use the available information on its outcomes to determine the characteristics of the procurement program and its environment for any medical consequences. Therefore, the report has tabled the necessary issues that any organisation needs to consider in its procurement process in case of any project as the one discussed in the paper.
Adomavicius, G, Gupta, A, & Sanyal, P 2012, ‘Effect of Information Feedback on the Outcomes and Dynamics of Multisourcing Multiattribute Procurement Auctions’, Journal of Management Information Systems, vol. 28 no. 4, pp. 199-230.
Kedar, U, Faith, E, & Berit, B 2011, ‘EIA and green procurement: Opportunities for strengthening their coordination’, In Environmental Impact Assessment Review, vol. 33 no. 1, pp. 73-79.
Sandra, C 2012, ‘Risk aversion and asymmetry in procurement auctions: Identification, estimation and application to construction procurements’, In The Econometrics of Auctions and Games, Journal of Econometrics, vol. 168 no. 1, pp. 96-107.
Walker, H, Brammer, S 2012, ‘The relationship between sustainable procurement and e-procurement in the public sector’, In Sustainable Development of Manufacturing and Services, International Journal of Production Economics, vol. 140 no. 1, pp. 256-268.
Yeow, J, & Edler, J 2012, ‘Innovation procurement as projects, ‘Journal of Public Procurement, vol. 12 no. 4, pp. 472-504.