Procurement 101: Purchasing at ANU

1. Procurement 101: Purchasing at ANU Presented by the University Procurement and Contracts Office (UPCO) 29 June 2011

2. Items for Discussion • University Policy and Procedure • Procurement Thresholds • Principles and Objectives of University Procurement • UPCO • Legislation and Acts • Preferred Supplier Arrangements • ANU Purchase Cards • Training • Procurement Terms • Tips

3. Question…Do you know about the University Procurement Policy and Procedure and where to find it? http://policies.anu.edu.au/policies/university_procurement_policy/policy http://policies.anu.edu.au/procedures/procurement/procedure

4. Question…Do you know about the University Procurement Thresholds and where to find them? http://info.anu.edu.au/fbs/assets/Business_Functions/Purchasing_and_Contracts_Office/University-Procurement-Thresholds-May-2011.pdf

5. Principles and Objectives of University Procurement • The objectives for University Procurement staff is to provide goods and services for administration, teaching and research in the most cost effective and timely manner to ensure that the needs of the University are satisfied. • The underlying principle of Procurement policy requires that the procedures and methods adopted not only should be, but also should be seen to be, beyond reproach. This can only be achieved if: • all who are able to do business with the University are given the opportunity to do so; • the University maintains a reputation for fair dealing in its arrangements with suppliers; and • best value for money is an underlying factor in all transactions, i.e. the goods and/or services are of satisfactory quality, availability and suitability for the desired purpose, and the prices paid are the best obtainable.

6. Who is UPCO? Mr Tim MacPherson Manager x55423 Mr Ron Robertson Mr Des Collings Mr Brendan O'Brien Mr Neil Ross Mr Graham Rooks x55153 x55959 x50094 x52518 x55400

7. UPCO Roles and Responsibilities • Procurement Policy and Procedure • Procurement Handbook • Tender advice and assistance • Direct source advice • Contract management • Registration and publication of tenders • Financial analysis of contracts • UPCO Contract database • Procurement advice and training • Management of University-wide arrangements • Fleet management

8. When do you consult UPCO? • Advice on any procurement issue • For any Tender in excess of $250,000.00 • Market approach assistance • RFx/EOI registration for market advertisement (x = Quotation, Proposal or Tender; EOI = Expression of Interest) • Contract advice (Indemnity, Warranty, Confidentiality etc) • Procurement and contract templates • Contract disputes and negotiations • Preparation of contracts • Contract administration/management issues and performance monitoring • Procurement policy and procedure issues • Fleet management

9. What legislation and Acts apply to the University? Primary • Australian National University Act 1991 • Commonwealth Authorities and Companies Act 1997(CAC Act) Others to be considered • Auditor-General Act 1997 • Occupational Health and Safety Act 1991 • Archives Act 1983 • Environment Protection and Biodiversity Conservation Act 1999 • Many others!

10. Preferred Supplier Arrangements • A Preferred Supplier is a company that, as a result of an open procurement process, has been contracted by the University to provide specific products and/or services under set conditions for a set period of time. • Purchases can be made from Preferred Suppliers for their contracted products, without the need for further quotations/ tender processes. • For large volume orders a Best and Final Offer can be requested. http://info.anu.edu.au/fbs/Business_Functions/Purchasing_and_Contracts_Office

11. Preferred Supplier Arrangements (cont.) What products/services do they provide? • Stationery • Travel Management & Air Travel • Multifunction Devices & Printers • IT Desktops & Laptops • Furniture • Special, Medical & General Gases, Liquid Nitrogen Vessel Maintenance • Chemicals & Lab Consumables • Campus Distribution, Courier & Mail Services

12. Preferred Supplier Arrangements (cont.) Who are our Preferred Suppliers? Dell Computer Konica Minolta Corporate Express American Express Dataflex DHL Express Fisher Biotec Campus Travel Lenovo Ricoh SteriHealth Virgin Aust. Apple Kyocera Mita Merck STA Travel Canon Qantas Interpath UPS SCS Fuji Xerox Crown Sci. Lomb Sci. BOC

13. What are the benefits of using Preferred Suppliers? • Competitive quotations not required for the procurement. • Thresholds do not need to be considered for procurement. • Contracted terms are in place to protect the University.

14. What are the restrictions of using Preferred Suppliers? • Cheaper prices may be available (terms and conditions can be costly to the University) • Example 1 Purchased PS Cost • Purchase Konica Copier $11,000.00 $14,500.00 • Copy Cost/consumables per annum $35,000.00 $3,360.00 • Whole of Life (5 years) Cost $186,000.00 $31,300.00 • Example 2 Purchased PS Cost • Ordered Sample Containers $48,000.00 $54,000.00 • Company unable to supply ordered brand. As per condition of quote they could provide equivalent specification item as alternate. • Original item could be used in centrifuge, but not designed (specified) for centrifuge use. No requirement for supplier to provide centrifuge compatible product. • Area ended up with ~100,000 containers they couldn’t use and lost a full months collection. • A condition of preferred supplier agreements is that alternate products must be approved by the University

15. ANU Purchase Cards The University strongly recommends that staff consider the following, before using your purchase card: • Is the purchase within your limits? • Are you dealing with a reputable vendor? • If ordering online, does the vendor’s website have adequate security? • Always be cautious about providing card or personal information. http://info.anu.edu.au/fbs/Business_Functions/Operations/Purchase_Card

16. Procurement Training Cert IV in Government (Procurement and Contracting) Overview • This specialist qualification covers the competencies required of personnel responsible for the procurement of goods or services. Who Should Attend • The Certificate IV in Government (Procurement & Contracting) is designed to provide procurement officers in the public sector (this is tailored to suit the University) with the competencies required to effectively perform their roles in complex procurement and contract management.

17. Procurement Terms ‘Delegate’Question – What does ‘Delegate’ mean in relation to University procurement? Answer – A person invested with authority to carry out the functions, powers and duties of, or to act on behalf of or represent others. A person who occupies an official position at the University, that position having been assigned authorities or powers by the Vice-Chancellor by way of the University’s delegations system.

18. Procurement Terms ‘Value for Money’Question – What does ‘Value for Money’ mean in relation to University procurement? Answer – A comparative analysis of all relevant costs and benefits of each proposal throughout the whole procurement cycle (whole-of-life costing).

19. Procurement Terms (cont.) ‘Ethics and Probity’Question – What does ‘Ethics and Probity’ mean in relation to University procurement? Answer – Conduct of procurement such that University money is used in an honest, fair and reasonable manner. Maintaining transparency, accountability and measures against conflicts of interest, and compliance with University policy, procedure and government legislation for the procurement of goods and services.

20. Tips for Effective Procurement Processes • Planning – the 6P principle! • Seek guidance • Assess risks • Involve stakeholders (e.g. legal, subject matter experts, key personnel, procurement etc.) • Find sufficient resources • Form a Procurement Plan

21. Tips for Effective Procurement Processes (cont.) • Target the market • Evaluate bids correctly • Issue Purchase Order / Contract • Monitor the project • Review the process for lessons learnt

22. Policy and Procedure Documentation Training

23. Contact UPCO Contracts.office@anu.edu.au