Ryerson University Project Management Certificate

1. Ryerson UniversityProject Management Certificate Procurement and Contracts Overview presented to the PMI-ISLIG Nov 11, 2004 by Desmond P. Alvares des_alvares@bcs.org.uk 416 258 7178

2. Desmond P. Alvares B. Eng., MBA, MBCS CITP, CMA Degree in Mechanical Engineering - UK MBA at Schulich School of Business, York University Finance, Accounting and Strategy Certified Management Accountant - Ontario Chartered Information Systems Practitioner – UK (2001) Chartered IT Professional – UK (2004) 19 years Business Intelligence and Knowledge Management in Canada, UK, US, Switzerland and Caribbean 10 years Investment Banking (Brokerage Houses, Private Banking and Oil &Gas trading) 6 years Retail Banking (Technology Business Management, Operational Risk, Electronic Banking and Mortgages, Finance and Treasury Systems) 3 years Property and Casualty Insurance (Finance and Actuarial Systems) Introduction – Who Am I Desmond Alvares CKPM 205 Procurement and Contracts

3. Financial Systems Implementations Business, Training, Finance and Treasury Projects Internal and Client Facing Projects Internal Providers and Integration of Vendor Solution Introduced and Developed Project Management Methodology – UBS Private Banking (International locations base on Swiss framework) and CIBC Retail (PMP based on the PMI framework) Lecturer at Ryerson University – Project Management Certificate (Construction, IT and Financial Service students) and Architecture specialization in Project Management. Introduction – PM Background Desmond Alvares CKPM 205 Procurement and Contracts

4. Introduction The Certificate Program at Ryerson The Procurement Process Planning Solicitation Source Selection Contract Administration Close-out Agenda Desmond Alvares CKPM 205 Procurement and Contracts

5. Athabasca University Executive MBA in Project Management (on-line and residence) Centennial College Project Management Certificate (6 courses) Advanced Project Management Certificate (4 courses) Durham College Intro, Scheduling Software, Statistics Humber College Project Management Certificate (4 courses, 45hrs) University of Toronto Project Management Certificate (4 courses, full day) York University The Graduate Certificate in Project Management (8 courses) Other Offerings of Project Management Courses Desmond Alvares CKPM 205 Procurement and Contracts

6. Core Courses CKPM202 Fundamentals of Project Management CKPM203 Planning and Scheduling CKPM205 Procurement and Contracts CKPM209 Project Risk and Quality Management CKPM210 Project Leadership CKPM211 Project Cost Management Electives CKPM207 Project Management Systems CKPM208 Analytical Decision Making CCMN114 Short Management Reports CCMN432 Technical Communications CMHR405 Organizational Behaviour and Interpersonal Skills CQMS102 Business Statistics I The Ryerson Offer (8 Courses) Desmond Alvares CKPM 205 Procurement and Contracts

7. 570 surveys distributed to students, 271 returned 164 surveys to graduates, 24 returned Students select Ryerson first and then the Certificate Course 75% (Ryerson Website, Ryerson material) 44.6% in Project Manager or Project Coordinator positions Experience 80% (> 5 Years), 25.1% (> 15 Years) 85% interested in becoming professional in 2 years 85.2% using certificate as preparation, but lack work experience Graduates (61.9% PMI members, 25% PMP), 75% additional prep Risk, cost and planning / scheduling – more theory than practice Interest in PMO, Leadership and Communication Common text book required, introduce PMP Preparation The Students View Desmond Alvares CKPM 205 Procurement and Contracts

8. Objectives Technical & Quality Schedule Cost Definition of the Procurement Process Desmond Alvares CKPM 205 Procurement and Contracts

9. Define the Goods and Services to be procured Select bidders and Complete Request for Proposal Prepare Bids and Award Contract Contract Management Close out Contact Basic Steps Desmond Alvares CKPM 205 Procurement and Contracts

10. Role of Project Management Interfaces with Other Project Processes Importance of Management Ethical Practices Principle Types Standard, Material, Equipment & Services Definitions of Common Terms Other Aspects Desmond Alvares CKPM 205 Procurement and Contracts

11. Organization Project Managers responsibility Procurement department – purchasing & materials Responsibilities Staffing – direct and matrix Procedures Requests, Qualified Bidders, RFP, Contact Management Management Program Organizations for Procurement Desmond Alvares CKPM 205 Procurement and Contracts

12. What to Procure? How much to procure? When to procure? Selecting an appropriate method of procurement. Qualifying suppliers. Developing a contracting strategy. Establishing appropriate performance measures. Documenting the procurement project plan. Procurement Considerations Desmond Alvares CKPM 205 Procurement and Contracts

13. 12.1 Plan Purchase and Acquisition(Procurement Planning) Desmond Alvares CKPM 205 Procurement and Contracts

14. 12.1 PLAN PURCHASE AND ACQUISITION Tools & Techniques Make-or-Buy Analysis Expert Judgment Contract Types Outputs Procurement Management Plan Contract Statement of Work Make or Buy Decision Project Management Plan (Updates) Inputs Project Charter Project Scope Statement Project Management Plan WBS and Dictionary Environment and Organization Factors Organizational Process Assets Risk Register

15. .1 Project Charter Business needs .1 Project Scope Statement Project needs and strategies .2 Project Management Plan Overall plan for the project 12.1.1 Inputs to Plan Purchase and Acquisition Desmond Alvares CKPM 205 Procurement and Contracts

16. .3 Work Breakdown Structure and Dictionary Relationship of all elements in plan .4 Environmental and Organizational Factors What is available in the marketplace? Procurement resources available 12.1.1 Inputs to Plan Purchase and Acquisition Desmond Alvares CKPM 205 Procurement and Contracts

17. .5 Organizational Process Assets Informal and formal procurement processes .6 Risk Register Risks , categorization and their mitigation 12.1.1 Inputs to Plan Purchase and Acquisition Desmond Alvares CKPM 205 Procurement and Contracts

18. .1 Make-or-buy analysis .2 Expert judgment .3 Contract type selection 12.1.2 Tools & Techniques for Plan Purchase and Acquisition Desmond Alvares CKPM 205 Procurement and Contracts

19. Factors to analyze: Cost (direct and indirect - lifecycle costs) Schedule Quality Capability & availability of in-house resources Supplier skills and abilities Degree of control needed by the performing organization 12.1.2.1 Make or Buy Analysis Desmond Alvares CKPM 205 Procurement and Contracts

20. Other Departments Consultants Professional and Technical Associations Industry groups 12.1.2.2 Expert Judgement Desmond Alvares CKPM 205 Procurement and Contracts

21. Three broad categories of contract type: Fixed price or lump sum FFP FPPI Cost reimbursable CPFF CPPF CPIF Time and Materials (Unit Price) 12.1.2.3 Contract Types Desmond Alvares CKPM 205 Procurement and Contracts

22. Contract Type vs. Risk Allocation Scope of Work Information Very Little Partial Complete Uncertainty HIGH MODERATE LOW Degree of Risk HIGH LOW MODERATE 100% Buyer 0% Suggested Risk Allocation 0% Seller 100% Contract Types CPPF CPIF CPFF FPPI FFP CPPF: Cost + % Fee FPPI: Firm Price + Incentive Fee CPIF: Cost + Incentive Fee FFP: Firm Fixed Price CPFF: Cost + Fixed Fee

23. .1 Procurement management plan .2 Contract Statement(s) of work .3 Make-or-Buy Decision .4 Project Management plan (update) 12.1.3 Outputs from Plan Purchase and Acquisition Desmond Alvares CKPM 205 Procurement and Contracts

24. Defines procurement process Basic requirements Products/services list to procure Roles and responsibilities Budget Schedule Quality criteria Specifications Contract type to be used 12.1.3.1 Procurement Management Plan Desmond Alvares CKPM 205 Procurement and Contracts

25. A narrative description of the product Clear, concise and as complete as possible Sufficient detail Allows prospective sellers to determine whether they are capable of providing the product Could be revised and refined throughout the procurement process 12.1.3.2 Contract Statements of Work Desmond Alvares CKPM 205 Procurement and Contracts

26. 12.2 Plan Contracting(Solicitation Planning) Desmond Alvares CKPM 205 Procurement and Contracts

27. Preparing the documents needed to support the solicitation process 12.2 Plan Contracting Desmond Alvares CKPM 205 Procurement and Contracts

28. 12.2 PLAN CONTRACTING Outputs Procurement Documents Evaluation Criteria Contract Statement of Work (Updates) Inputs Procurement Management Plan Contract Statements of Work Project Management Plan Make-or-Buy Decision Tools & Techniques Standard Forms Expert Judgment

29. .1 Procurement Management Plan .2 Contract Statement(s) of work .3 Project Management Plan .4 Make-or-buy Decision 12.2.1 Inputs to Plan Contracting Desmond Alvares CKPM 205 Procurement and Contracts

30. .1 Standard forms Standard contracts, bid documents .2 Expert judgement 12.2.2 Tools & Techniques for Plan Contracting Desmond Alvares CKPM 205 Procurement and Contracts

31. .1 Procurement documents .2 Evaluation criteria .3 Contract Statement of work updates 12.2.3 Outputs from Plan Contracting Desmond Alvares CKPM 205 Procurement and Contracts

32. Documents used to solicit proposals from prospective vendors Request for Proposal (RFP), Quote(RFQ) or Bid (RFB) Instructions (e.g. desired form of response) Blank contract form Product description or SOW Contractual provisions Terms and conditions 12.2.3.1 Procurement Documents Desmond Alvares CKPM 205 Procurement and Contracts

33. Criteria used to create or score proposals Objective vs. subjective Weigh the criteria in terms of importance 12.2.3.2 Evaluation Criteria Desmond Alvares CKPM 205 Procurement and Contracts

34. 12.3 Request Seller Responses(Solicitation) Desmond Alvares CKPM 205 Procurement and Contracts

35. Obtaining the information (bids and/or proposals) from the prospective sellers Most of the actual effort is done by the sellers 12.3 Request Seller Responses Desmond Alvares CKPM 205 Procurement and Contracts

36. 12.3 REQUEST SELLER RESPONSES Inputs Procurement Documents Organizational Process Assets Tools & Techniques Bidders Conference Advertising Outputs Qualified Sellers List Procurement Document Package Proposals

37. .1 Procurement documents .2 Organizational Process Assets 12.3.1 Inputs to Request Seller Responses Desmond Alvares CKPM 205 Procurement and Contracts

38. .1 Bidder conferences Used to ensure that all prospective sellers have a common understanding of the procurement .2 Advertising Used to expand the list of potential sellers Sometimes required on public projects 12.3.2 Tools & Techniques for Request Seller Responses Desmond Alvares CKPM 205 Procurement and Contracts

39. .1 Qualified seller lists Internally maintained lists List developed by the project team .2 Procurement Documentation Package .3 Proposals Seller-prepared documents that describe the seller’s ability and willingness to provide the requested product 12.3.3 Outputs from Request Seller Responses Desmond Alvares CKPM 205 Procurement and Contracts

40. 12.4 Select Sellers (Source Selection) Desmond Alvares CKPM 205 Procurement and Contracts

41. Receipt of bids or proposals Application of the evaluation criteria to select a provider Risk evaluation, lifecycle cost, independent estimates Contract negotiations Award the contract 12.4 Select Sellers Desmond Alvares CKPM 205 Procurement and Contracts

42. 12.4 SELECT SELLERS Tools & Techniques Weighting System Independent Estimates Screening System Contract Negotiation Inputs Proposals Evaluation Criteria Organizational Process Assets Risk Register Risk-Related Contractual Agreements Qualified sellers List Procurement Document Package Outputs Selected Sellers Contract Contract Management Plan

43. .1 Proposals .2 Evaluation Criteria .3 Organizational Process Assets .4 Risk Register .5 Risk Related Contractual Agreement .6 Qualified Sellers List .7 Procurement Documentation Package 12.4.1 Inputs to Select Sellers Desmond Alvares CKPM 205 Procurement and Contracts

44. .1 Weighing system Method for quantifying qualitative data Minimize the effect of personal prejudice .2 Independent estimates Procuring organization may prepare its own estimates as a check on pricing .3 Screening system Establishing minimum performance requirements for evaluation criteria 12.4.2 Tools & Techniques for Select Sellers Desmond Alvares CKPM 205 Procurement and Contracts

45. .4 Contract negotiation Involves clarification and mutual agreement on the structure and requirements of the contract Final contract to reflect all agreements reached Examples of subjects covered: responsibilities & authorities, terms and law, contract financing, price 12.4.2 Tools & Techniques for Select Sellers Desmond Alvares CKPM 205 Procurement and Contracts

46. .1 Select Sellers .2 Contract Mutual agreement which obligates the seller to provide the specified product and obligates the buyer to pay for it. Legal relationship subject to remedy in the courts Contract =agreement=subcontract=purchase agreement=memorandum of understanding .3 Contract Management Plan 12.4.3 Outputs from Select Sellers Desmond Alvares CKPM 205 Procurement and Contracts

47. 12.5 Contract Administration Desmond Alvares CKPM 205 Procurement and Contracts

48. Ensuring that the vendor’s performance meets contractual requirements Application of project management processes to the contractual relationship Project plan execution Performance reporting Quality control Change control Communication management 12.5 Contract Administration Desmond Alvares CKPM 205 Procurement and Contracts

49. 12.5 CONTRACT ADMINISTRATION Outputs Organizational Process Assets (updates) Requested Changes Recommended Corrective Actions Contract Documentation Inputs Contract Approved Change Requests Work Performance Information Selected Sellers Tools & Techniques Contract Change Control System Buyer-Conducted Performance Reviews Inspections and Audits Performance Reporting Payment System Claims Administration Records Management System

50. .1 Contract .2 Performance Reports Which deliverables completed, not completed To what extent quality standards are being met .3 Approved Change requests Modifications to the terms of the contract or to the description of the product or service Contested changes where the seller and project management team cannot agree on compensation for the change are also called claims, disputes or appeals .4 Work Performance Information .5 Selected Sellers 12.5.1 Inputs to Contract Administration Desmond Alvares CKPM 205 Procurement and Contracts