Procurement Documents

April 13, 2010
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Introduction

Procurement documents are ones the buyer organization uses to solicit proposals from sellers. In a very general sense the terms bids, quotations and tenders are used when the seller is to be selected based on price mainly. These would typically apply to commercial and standard items. The term proposal is often used when the technical competence of the seller would be more important as a selection criterion. (RFI) request for information, (RFP) request for proposal, (IFB) invitation for bid, (RFQ) request for quotation, tender notice, an invitation for negotiations and seller initial response is various kinds of documents that are in use in the procurement process. Different names may be in use in different organizations through intent wise they would fall into one of those categories.

The purpose and the Nature of These Documents

The purpose of the whole exercise of inviting bids/proposals and obtaining information about the selling organization as well as pricing information is to make the selection process easy and to ensure the procurement is done at an optimal cost, in the quickest possible way and of course at the right quality levels. The ability to select the right vendor so that you have minimal risks associated with the procurement process is very crucial. The statement of work and these bid related documents constitute the set of procurement documents. The evaluation process, evaluation criteria s0pecific to the project etc. are dictated by the way things are done in a given organization.

The complexity and detail presented in the procurement should be directly related to the complexity and the value of the procurement effort. Otherwise the time and effort made in preparing the document cannot be justified. A seller organization too would not have the time to go through a complex SOW and other documents if the effort does not lead to a project of commensurate value.

The structure of the response invited should be such that it’ll ensure consistent and appropriate responses. Yet, it should be flexible enough to accommodate responses from vendors suggesting alternate means of doing things. How exactly the process of inviting bids are to be carried out are dictated by the conventions existing in the organization, moderated by the need to make changes if the specific project is somewhat unique. How the process is initiated is quite set in many organizations. These may be through the release of an ad in the local papers/ national papers, trade press, public registries or even the Internet. It usually starts with an RFI that seeks information on the seller organization. T\When the interested seller organizations respond to this then the proposals are evaluated. The evaluation leads to a shortlist of vendors, the buying organization feels, have the capabilities to meet the requirements of the procurement action.

These short listed vendors are then supplied with the SOW and a RFP/RFQ to bid on the project. The RFP/RFQ document clearly provides a format in which vendors must respond. Wherever necessary, appropriate enclosures are sought. A typical situation would be when a Gantt chart for the project as defined in the SOW and as the seller sees it. The evaluation criteria are also defined so that the seller is clear about how the selection would be made. The type of contract that will guide the procurement action will also be defined. Sometimes these proposals attach boilerplate contracts for the seller to provide appropriate details required from the vendor as well as making sure the vendor takes all the contractual obligations into account too.

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2 Responses to Procurement Documents

  1. karthik on May 18, 2011 at 6:58 am

    thanks for worthy information.

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