Procurement, like any business function, has to continually deliver value. Best-in-class procurement organizations plan and execute well, engage with stakeholders and consistently show that the vendors being selected are providing the best overall value to the company.
That’s why project management is such a critical part of procurement. As procurements increase in size and complexity, there are simply more activities, stakeholders and risks that need tobe identified and managed. Having a procurement Project Manager integrated into the procurement process significantly increases the odds of not only a successful procurement, but also an on-time, on-budget implementation.
There are six important responsibilities the Procurement Project Manager undertakes:
1. Initiating the Project.
When there is a new procurement, a Project Manager should be assigned so they can kick off the procurement project. This includes getting the initial stakeholders together to understand the scope and objectives for the procurement, and to discuss high-level expectations and timelines for the project.
2. Creating the Procurement Plan.
Establishing a comprehensive procurement plan is an important role the Project Manager plays to define expectations and align stakeholders. An effective procurement plan covers not only the process for procuring the goods, technology, or services but also the post-procurement activities required to effectively transition into the business operations. The transition plan may not come until after a vendor/solution is selected, but it’s a critical part of the overall success of the project as that’s where the rubber hits the road.
3. Coordinating Internal Stakeholders.
Large, complex procurements nearly always have many internal stakeholders.
This starts with the Business Owner who initiated the procurement and the personnel who will actually use the product or service, as well as other stakeholders from information technology, information security, compliance, legal, and finance. The PM’s role is to ensure that all relevant stakeholder groups have been identified and that they are engaged at the appropriate times throughout the procurement process.
4. Coordinating Vendors.
In addition to coordinating your internal stakeholders, your vendors need coordination too. Multiple vendors may be involved during the procurement process, and each vendor may have multiple personnel involved. The Project Manager’s role is to ensure each vendor has identified their own project manager who will serve as the single point of contact throughout the procurement and to coordinate with those PMs to schedule meetings/demos, obtain proposals, get questions answered, and facilitate the contracting process.
5. Communicating Responsibilities and Updates.
Keeping all stakeholders on track during the procurement process is a necessity if you want to hit your deadlines. The Project Manager is responsible for determining what information is important to communicate, collecting that information from the appropriate stakeholders, and packaging and distributing it at the right times. Weekly email updates, project status reports, and face-to-face meetings are all forms of communication channels that the Project Manager can use throughout a lengthy procurement project.
6. Supporting Implementation and Transition.
Once the procurement is complete and a contract has been signed with a vendor, the Project Manager plays a critical role in supporting the Business Owner during the implementation of the project and, ultimately, transitioning the software/services into operations. The PM assumes many of the same responsibilities as during the procurement process such as planning, coordination, and communication, but is now focused on the implementation of the solution rather than the selection of the vendor. The PM also provides a bridge between the procurement process and the implementation process, ensuring that there is a continuity of knowledge and expectations throughout the entire cycle.
Depending on the size of your organization, identifying your procurement project manager may (or may not) be easy. If you’re fortunate enough to have a central Project Management Office (“PMO”), or your procurement department has project managers on staff, you’re in good shape. However, if you’re like many mid-sized and smaller organizations, you may need to pull your project manager from the business unit or, for more complex procurements, hire a specialist to run the procurement for you.
Also remember, not every procurement needs a project manager. Assess the scope and complexity of your procurement to identify when you really need one.