9.3.1 Introduction

Categories: 9.3 Procurement Planning
Time of issue: 2022-05-16 13:13:48
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Procurement planning may take either of two fundamentally different approaches, depending on whether it is for a specific investment project or one of the more programmatic types of lending operations. Regardless of which type of project, it is essential to develop a plan that clearly sets out the framework in which procurement will be done.

The conventional approach for specific investment projects with known design and content is to start by compiling a list of all known goods, works and services needed to complete the project. This list then becomes the basis for deciding how these items should be combined or divided into contract packages, what method of procurement should be used for each, and the scheduling for procurement activities. Even this seemingly straightforward preparation of the list of needs already implies a strategic decision about how procurement and contracting will be done.

Rather than focusing on the finite elements of details of a project it may be more appropriate to approach procurement through a well-structured planning process that focuses on the procedures, responsibilities and criteria for determining project components or sub-projects and for choosing appropriate procurement arrangements. The procurement planning process will involve several steps, including:

Organizing a project management/implementation team;
Defining the scope of work;
Developing a procurement schedule;
Preparing and packaging the bid and contract documents;
Advertising and notification of the procurement opportunities;
Qualifications of bidders;
Evaluation and Comparison of Bids for Goods and Services;
Finalize contract terms with selected firm;
Award and signing of the contract; and
Project monitoring and audits.

Example

A rural wastewater management project normally consists of installing a sewer collection system, a treatment facility, and a land disposal system. The entire project might be done using a turnkey or a design/build approach: the full responsibility for designing and installing the system given to a single contractor.

This single contract would comprise the whole list of needs. On the other hand, the project could be divided into separate contracts for design consulting services, construction of the sewer, treatment works and disposal system -- each of these representing a “need” for the procurement list. The extreme case would be to list quantities of different pipe sizes, wastewater treatment equipment, etc. for materials purchases, separate contracts for installation, contract manager services, etc. In this case, the procurement list could run into dozens or hundreds of items. The degree of detail in the list will depend on how the project is intended to be