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Project Management and Procurement Managing Procurement Projects (e.g. sourcing projects, technology projects, procurement transformation initiatives) and managing procurement in projects (e.g. buying for projects)

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  #1  
Old 01-08-2009, 11:17 AM
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Default Specific Procurement Project Related Risks

Is there a list out there of procurement project management risks?
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Old 01-14-2009, 12:37 PM
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Default Re: Specific Procurement Project Related Risks

Bernie,

I can help with a list, as long as users of the list keep in mind that ticking items off a list is not proper risk identification! The list below show some primary generic risks in procurement projects and SHOULD NOT BE VIEWED as a comprehensive list for all projects. I list the risks in order of most likely AND worst impact, that means that the first item is the highest risk, second is a little lower risk etc.

Risk 1: Stakeholders are clueless about procurement and their own functional areas. (I am very serious!)
Risk 2: The Custodian of Procurement cannot establish credibility for the function.
Risk 3: The Goal of the Procurement Project is not clear and agreed (E.g. TCO vs price).
Risk 4: Properly structured Cross Functional Teams are not in place.
Risk 5: Measures for project success are vague.
Risk 6: Inability to compile SLA's (Both internal and with suppliers)
Risk 7: Procurement representatives lack "team charm".
Risk 8: Project management principles are not applied.
Risk 9: Pursuit of "quick wins".
Risk 10: Data paralysis (Procurement's obsession with old buying data)
Risk 11: Contracts without agreements.
Risk 12: Many FD's (See Risk 1 and think about an FD's sphere of influence).
Risk 13: The Existing (Suppliers, operational practices, habits, etc.).
Risk 14: Year end desperation ("We need to save $ XXXX by year end").
Risk 15: Killer" negotiators (They talk about blood on the walls).

I'll stop there for now to keep the thread compact.

In my experience stakeholders in procurement projects tend to focus on technical commodity risk (Much "cooler"). In reality, a project team will most likely overlook these technical risks or fail to contain them if they do not run a healthy project first.
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Old 01-14-2009, 12:53 PM
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Default Re: Specific Procurement Project Related Risks

What do you mean by contracts without agreements. Did you not mean agreements without contracts
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Old 01-28-2009, 10:49 AM
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Default Re: Specific Procurement Project Related Risks

No I meant exactly that. What happens is that contracts are drafted unilaterally and then presented to suppliers to "accept". A kind of "take it or leave it" approach.

The better way is to agree to the details of a deal, and then record that agreement in a written contract. This includes recourse and penalties. You should have buy-in to the deal and then record it in a "paper contract".

Failing to do so most often lead to parties sending the paper document back and forth to resolve "disagreement". This is usually when we start buying without contracts in place or the contract is never actually signed.
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Old 08-03-2009, 12:41 PM
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Default Re: Specific Procurement Project Related Risks

Well at least some of the quality management/suppliers risks can be eliminated through third party expediting. Organizations like TUEV Hessen, SGS etc. will go out to the supplier and control quality, number and packing of the goods. That's at least one risk to tick off the list
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Old 08-10-2009, 02:31 PM
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Default Re: Specific Procurement Project Related Risks

Use the project management software calculator from the following link Cost Calculator - Web Based Project Management Software to calculate your project management software costs.
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