Pmbok4thedition Chapter12 120114101814 Phpapp02

8/12/2019 Pmbok4thedition Chapter12 120114101814 Phpapp02

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CHAPTER12

PROJECTPROCUREMENT

MANAGEMENT

Ahmad H. Maharma

PMP


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12.ProjectProcurementManagement

Planning

Processes

Monitoring &

Controlling Processes

Enter phase/

Start project

Exit phase/

End project

Initiating

Processes

Closing

Processes

ExecutingProcesses

Knowledge Area

Process

Moni torin &

n a ng ann ng xecu ng Contol os ng

Plan Purchases -

and Acquisitions

Request Seller -

Responses

Contract -

Administ rat ion

Contract Closure

Plan Contracting Select Sellers


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ProjectProcurement

anagemen

Theprocess

necessary

to

process

and

acquire

product

or

services,orresultneededfromoutsidetheprojectteam.

Involveplanning,acquiringtheproductorservicesfrom

sources,choosing

asource,

administering

the

contract,

and

closingoutthecontract.

,

,andcontractsbetweenorganizationunitswithinsingle

entity.


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Project

Managers

Role

in

Procurements PMmustbeinvolvedinthecreationof

Keyroles: Knowtheprocurementprocess

Understandcontracttermsandconditions

Makesure

the

contract

contains

all

project

management

requirements

suc asa en ancea mee ng,repor s,ac onsan commun ca ons

deemednecessary

Identifyrisksandincorporatemitigationandallocationofrisksintothe

contract

Helptailorthecontracttotheuniqueneedsoftheproject

Alignscheduleofthecontractandscheduleoftheproject

Makesureprocurementprocessdonesmoothly

Workwith

contract

manager

to

manage

changes

to

the

contract


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PROJECTPROCUREMENT

MANAGEMENT

ProjectProcurementManagementincludestheprocesses

necessarytopurchaseoracquireproducts,services,orresults

needed

from

outside

the

project

team.

Theorganizationcanbeeitherthebuyerorselleroftheproducts,

services,orresultsofaproject.

ProjectProcurementManagementincludesthecontract

managementandchangecontrolprocesses

(thebuyer)thatisacquiringtheprojectfromtheperforming

z ,


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PROJECTPROCUREMENT

MANAGEMENT

12.1 PlanProcurementsTheprocessofdocumentingproject

purchasingdecisions,specifyingtheapproach,andidentifying

potential

sellers.

12.2 ConductProcurementsTheprocessofobtainingseller

responses,selectingaseller,andawardingacontract.

12.3 AdministerProcurementsTheprocessofmanaging

procurementrelationships,monitoringcontractperformance,

andmaking

changes

and

corrections

as

needed.

.

project

procurement.


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PROJECTPROCUREMENT

MANAGEMENT


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PROJECTPROCUREMENT

MANAGEMENT

Thesellerwilltypicallymanagetheworkasaprojectiftheacquisitionisnotjustfor

shelfmaterial,goods,orcommonproducts.Insuchcases:

Thebuyer

becomes

the

customer,

and

is

thus

akey

project

stakeholder

for

the

seller.

projectmanagement, notjustwiththoseofthisKnowledgeArea.

Terms

and

conditions

of

the

contract

become

key

inputs

to

many

of

the

sellers

mana ement rocesses.Thecontractcanactuall containthein uts(e. .,ma or

deliverables,keymilestones,costobjectives),oritcanlimittheprojectteams

options(e.g.,buyerapprovalofstaffingdecisionsisoftenrequiredondesign

projects).

Thischapterassumesthatthebuyerofitemsfortheprojectisassignedtotheproject

teamandthatthe

o z o y x o o .


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12.1

PlanProcurements

PlanProcurementsistheprocessofdocumentingproject

purchasingdecisions,specifyingtheapproach,andidentifying

potential

sellers.

Itidentifiesthoseprojectneedswhichcanbestbe,ormustbe,

metbyacquiringproducts,services,orresultsoutsideofthe

ro ector anization

versus

those

ro ect

needs

which

can

be

accomplishedbytheprojectteam.

Thisprocess

involves

determining

whether

to

acquire

outside

supportand,ifsowhattoacquire,howtoacquireit,howmuch

isneeded andwhentoac uireit.


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12.1

PlanProcurements


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12.1.1

Plan

Procurements

In uts

.1 ScopeBaseline

WBS.

(Section5.3.3.1).

WBS dictionary.

.2Requirements

Documentation

Importantinformation about project requirements that is

considered during planningforprocurements.

includehealth,safety,security,

performance,environmental,insurance,intellectualpropertyrights,

equalemploymentopportunity,licenses,andpermitsallof

which

are

consideredwhen

planning

for

procurements.


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12.1.1

Plan

Procurements

In uts

.3 TeamingAgreements

twoor

more

entities

to

form

apartnership

or

joint

venture,

or

someotherarrangementasdefinedbytheparties.

.4RiskRegister

.5 RiskRelatedContractDecisions

.

.7 ProjectSchedule

.9 CostPerformanceBaseline

.10 EnterpriseEnvironmentalFactors

.11 OrganizationalProcess Assets


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12.1.2

Plan

Procurements

Tools

and

Techniques

1.MakeorBuyAnalysis

performparticularproduct

or

service

by

themselves

or

.

Evaluateofthebenefitanddrawback

skillsandresources

cost

Howcriticalisitthatweretaindetailedcontroloveracertainarea?

proprietaryinformation

or

trade

secret


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12.1.2

Plan

Procurements

Tools

and

Techniques


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12.1.2

Plan

Procurements

Tools

and

Techniques

2. ExpertJudgment

Experttechnical

judgment

will

often

be

used

to

assess

the

inputs

to

and

outputsfromthisprocess.

Expertpurchasingjudgmentcanalsobeusedtodevelopormodifythecriteria

thatwillbeusedtoevaluatesellerproposals.


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12.1.2

Plan

Procurements

Tools

and

Techniques

3.ContractType

Fixedprice

(FP)

contracts

FixedPrice(FP),orLumpSum,orFirmFixedPrice(FFP)

xe r ce ncent ve ee

FixedPricewithEconomicPriceAdjustment(FPEPA)

Purchaseorder:simplesttypeoffixedpricecontract;unilateral(signedbyoneparty)

Costreimbursable(CR)contracts CostPlusFixedFee(CPFF)orCostPlusPercentageofCost(CPPC)

CostPlusIncentiveFee(CPIF):

CostPlus

Award

Fee

(CPAF)

CostContract(Nofee/profite.g.contractinnonprofitorganization)

mean a er a on rac sHybridtypeofcontractualarrangementthatcontainaspectsofbothcostreimbursableandfixedpricecontracts


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Fixedprice(FP)contracts

Usedforacquiringgoodsorserviceswithwelldefined

specificationsorrequirements.

Selleris

most

concerned

with

the

SOW

Sometimethebuyerforcessellertoacceptahighlevelrisk

Sellerwouldneedhugeamountofreserves

Seller

can

try

to

increase

profit

by

cutting

scope

Examples: FP:Contract=$1M

FPIF:Contract

=$1M

+for

every

month

added

$1000

FPAF:Contract=$1M+foreverymonthadded$1000ifperformanceexceed

FPEA:Contract=$1M+additionalpricingbasedonGovernmentCenterBankdepreciationrate.

PO:$1K er1metricton


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Time&Material(T&M)contracts

Usedforservice effortsin whichthe levelofeffort

cannotbedefined atthetimethecontract isawarded

Tomake

sure

the

costs

do

not

become

higher

than

budgeted,thebuyermayputa"NottoExceed"andtime

m sc ause n econ rac .

Oftenusedforstaffaugmentation,acquisitionofexperts,

outsidesu ort

Example: Contract=$1Kperdayplusexpensesormaterialcost.

wood.


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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Typeofcontract


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ContractTypesvs.Risk

Effect of contract type on buyer & seller risk

HighLow

FFP

FPIF

SELLERBUYER

Cost Reimbursable

CPIF

RISK

CPFCPPC

LowHigh

T&M can be a high risk for buyer

if contract does not include atotal not-to-exceed (NTE)


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12.1.2 PlanProcurements Outputs

.1 ProcurementManagementPlan

Theprocurement

management

plan

describes

how

the

procurementprocesseswillbemanagedfromdeveloping

procurementdocuments throughcontractclosure. Theprocurementmanagementplancanincludeguidancefor:

Typesof

contracts

to

be

used;

Riskmanagement issues;

Whetherindependentestimateswillbeusedandiftheyareneededasevaluationcriteria;

Thoseactionstheprojectmanagementteamcantake unilaterally,iftheperforming

or anizationhasa rescribed rocurement contractin or urchasin de artment

Standardizedprocurement

documents,

ifthey

are

needed;

Managingmultiplesuppliers;

Coordinatingprocurementwithother projectaspects,such asschedulingandperformance

repor ng;


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.1 ProcurementManagementPlan(cont.)

Anyconstraintsandassumptionsthatcouldaffect planned procurements;

Handlingtherequiredleadtimestopurchaseitemsfromsellersandcoordinatingthemwith

theprojectscheduledevelopment;

HandlingthemakeorbuydecisionsandlinkingthemintotheEstimate ActivityResource and

DevelopScheduleprocesses;

Settingthescheduleddatesineach contractforthe contractdeliverablesandcoordinating

with the schedule develo ment and control rocesses

Identifyingrequirementsforperformancebondsorinsurancecontractstomitigate someforms

ofprojectrisk;

Establishingthedirectiontobeprovidedtothesellersondevelopingandmaintainingawork

rea owns ruc ure ;

Establishingthe

form

and

format

to

be

used

for

the

procurement/contract

statements

of

work;

Identifyingprequalifiedsellers,ifany,tobeused;and

Procurementmetricstobeusedtomana econtractsandevaluate sellers.


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.2 ProcurementStatementsofWork

Thestatementofwork(SOW)foreachprocurementisdevelopedfromtheprojectscopebaseline

anddefinesonlythatportionoftheprojectscopethatistobeincludedwithintherelated

contract.

TheprocurementSOWdescribestheprocurementiteminsufficientdetailtoallowprospective

sellerstodetermineiftheyarecapableofprovidingtheproducts,services,orresults.Sufficient

detailcanvarybasedonthenatureoftheitem,theneedsofthebuyer,ortheexpectedcontract

form.

InformationincludedinaSOWcanincludespecifications,quantitydesired,qualitylevels,

performancedata,periodofperformance,worklocation,andotherrequirements


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.3 MakeorBuyDecisions

Make

or

buy

decisions

document

the

conclusions

reached

regarding

what

projectproducts, services,orresultswillbeacquiredfromoutsidetheproject

, .

Thismayalsoincludedecisionstorequireinsurancepoliciesorperformance

on contractstoa resssomeo t ei enti e ris s.

Themakeorbuydecisionsdocumentcanbeassimpleasalistingthat

includes

a

short

justifi

cation

for

the

decisions.

Thesedecisionscanbealteredassubse uent rocurementactivitiesindicate

arequirementforadifferentapproach


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.3 MakeorBuyDecisions

Make

or

buy

decisions

document

the

conclusions

reached

regarding

what

projectproducts, services,orresultswillbeacquiredfromoutsidetheproject

, .

Thismayalsoincludedecisionstorequireinsurancepoliciesorperformance

on contractstoa resssomeo t ei enti e ris s.

Themakeorbuydecisionsdocumentcanbeassimpleasalistingthat

includes

a

short

justifi

cation

for

the

decisions.

Thesedecisionscanbealteredassubse uent rocurementactivitiesindicate

arequirementforadifferentapproach


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.4 ProcurementDocuments

InformationforSellers

Contractstatementof work

Nondisclosureagreement(NDA)todisclosesomeconfidentialinformation

Procurementdocuments,examples: RequestforInformation(RFI)

InvitationForBid(IFB)Procurement

document

Contract Type

RequestFor

Proposal

(RFP)

RequestForQuotation(RFQ)

Tendernotice

RFP CR

IFB FP

Invitationfornegotiation

Invitationfor

sellers

initial

response


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ProcurementDocument

LetterofIntent(LOI) , ,

intendstohireseller.

Acontractualrelationship

Example:YouhiredacontractorA,andthecontractorhiresanothersubcontractorBto

deliverpartofyourwork.EventhoughBisperformingyourwork,he/sheis

contractuallynotboundtoyou,becauseBcontractuallyboundtoAonly.

TeamingAgreements(orajoinventure) Twosellersjoinforceforoneprocurement


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.5 SourceSelectionCriteria

Some criteria for evaluating proposals and bids (due diligence): Understanding of need

Technical Capabilit

Past performance of sellers (experience)

Project management approach Financial stability & capacit

Intellectual & property rights

Overall or life cycle cost

Risk

Warranty

References


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.6ChangeRequests

Changerequests

(Section

4.3.3.3)

to

the

project

management

plan,itssubsidiaryplansandothercomponents mayresult

fromthe Plan Procurementsprocess.Changerequests are

processedforreviewanddisposition throughthePerform

Inte ratedChan e

Control

rocess

Section

4.5 .


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NoncompetitiveFormofProcurement

Formusedwhenonlyonesellerawardedwithouta

competitiveprocurement.

Shouldkeepfollowrulesofbiddingprocessandlaws

Savingtimeonprocurementprocess

Wouldbeimplementedinthefollowingcondition: The

project

under

schedule

pressure

Asellerhasuniquequalification

Thereisonlyoneseller

Asellerholdapatent

.

Typeofnoncompetitiveprocurement Singlesource:contractdirectlytopreferredseller.

Solesource:thereisoneseller;mightbeacompanyownsapatent


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ImportantTerms

Price,Profit(fee),Cost

:

projectwith

what

was

expected

(the

target

price).

,

usuallyexpressedasaratio,e.g.90/10(buyer/seller)

pay.

This

only

applies

to

fixed

price

incentive

fee

contracts

Referstotheamountabovewhichthesellerbearsallthelossofacostoverrun.

SellerusuallymonitoractualcostsagainstPTAtomakestillhavingprofit.

Formula:

PTA= ((Ceiling price Targetprice)/Buyer's shareratio)+Targetcost

E i C C l l i


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Exercise:ContractCalculation

Inthiscostplusincentive feecontract,thecost isestimated at$210,000

andthefeeat$25,000.Theprojectisover,andthebuyerhasagreedthat

t ecostswere, n act, , . ecause t ese er scostscame n ower

than

the

estimated

costs,

the

seller

shares

in

the

savings:

80

percent

to

thebuyerand20percenttotheseller.Calculatethefinal feeandfinal

.

Target cost

Target fee

210,000

25,000Target price

SharingRatio

235,000

80/20

Final fee

,

210,000 200,000 = 10,000

10,000 x 20% = 2,000

25000 tar et fee + 2000 =27 000

Final price 200,000+ 27,000 =227,000


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12.2 ConductProcurement

ConductProcurementsistheprocessofobtainingseller

responses,selectingaseller,andawardingacontract.

Inthisprocess,theteamwillreceivebidsorproposalsandwill

applypreviouslydefinedselectioncriteriatoselectoneor

moresellerswhoarequalifiedtoperformtheworkand

acce tableas

aseller.

Ashortlistofqualifiedsellerscanbeestablishedbasedona

preliminary

proposal.

2 2 C d


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12.2 ConductProcurement

12 2 1 C d P I


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12.2.1 ConductProcurementInputs

.1 ProjectManagementPlan

.3

Source

Selection

Criteria.4QualifiedSellerList

.5 SellerProposals

.6ProjectDocuments

.7 MakeorBuy Decisions

.8 TeamingAgreements

. rgan za ona rocess sse s


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12.2.2ConductProcurements:ToolsandTechniques

.1 Bidder Conferences

conferences,vendor conferences,andprebidconferences)

aremeetingswithallprospectivesellers andbuyerspriortosu m a o a orproposa . eyareuse oensure a a

prospectivesellershaveaclearandcommonunderstandingof

the

procurement(both

technical

and

contractual

requirements),andthat nobidders receivepreferential

treatment. Responsestoquestionscanbeincorporatedinto

buyersmust

take

great

care

to

ensure

that

all

prospective

sellersheareveryquestionfromanyindividualprospective

v y y .


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.2ProposalEvaluationTechniques

On

complex

procurements,

where

source

selection

will

be

madebasedonsellerresponsestopreviouslydefined

weightedcriteria, aformalevaluationreviewprocesswillbe

definedbythebuyersprocurementpolicies.Theevaluation

committeewill

make

their

selection

for

a roval

b

managementpriortotheaward.

Proposal Evaluation


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ProposalEvaluation(Tools&Techniques)

ProposalEvaluationorBidorPriceQuote

Oneoracom inationo o owingprocessuse

forselecting

seller:

Weightingsystemva ua e ywe g ng esourcese ec oncr er a

IndependentestimateEstimationcreatedinhouseorwithoutsideassistance

Screeningsystem

Eliminatesellerswhodonomeetminimumrequirement

astper ormance story


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.3 Independent Estimates

For

many

procurement

items,

the

procuring

organization

may elect to either prepare itsownindependent estimate,

orhavean estimate ofcosts preparedbyan outside

professionalestimator,toserveasabenchmarkonproposed

res onses.Si nificant

differences

in

cost

estimates

can

be

an

indication that the procurementstatement ofworkwas

deficient, ambiguous,and/orthatthe prospectivesellers

procurementstatement

of

work.

.4ExpertJudgment


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.5 Advertising

Existing

lists

of

potential

sellers

can

often

be

expanded

by

placingadvertisements ingeneralcirculation publications

such as selectednewspapers orinspecialty trade

publications. Somegovernmentjurisdictionsrequirepublic

advertisin

ofcertain

t es

of

rocurement

items

and

most

governmentjurisdictionsrequirepublicadvertisingofpending

government contracts.


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.6InternetSearch

The

internet

has

a

major

influence

on

most

project

procurements andsupplychainacquisitionsinorganizations.

While manycommodities,components,andofftheshelf

itemscanbequicklylocatedandsecuredatafixedpriceon

theinternet

the

hi h

risk

hi hl

com lex

rocurement

effort

thatmustbecloselymonitored cannotbeobtainedbythis

means.


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.7 ProcurementNegotiations

Negotiations

clarify

the

structure,

requirements

and

other

termsofthepurchasessothatmutualagreementcanbe

reachedpriortosigningthecontract.Finalcontractlanguage

reflectsallagreementsreached.Subjectscoveredshould

includeres onsibilities

authorit

to

make

chan es

a licable

termsandgoverninglaw,technical,andbusinessmanagement

approaches,proprietaryrights, contractfinancing,technical

, , , .

concludewith

acontract

document

that

can

be

executed

by

both buyer andseller.

Procurement Negotiations


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ProcurementNegotiations

PMmaybeinvolvedduringnegotiationtoclarify

, .

Obtainfairandreasonableprice

Developgoodrelationshipwiththeseller

Main itemstonegotiate: Scope

Price&

payment

Responsibilities

Authority

Applicablelaw

Technical&businessmanagementapproaches

Contractfinancing

12.2.3ConductProcurements:Outputs


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p

.1 SelectedSellers

The

sellers

selected

are

those

sellers

who

have

been

judged

to

beinacompetitiverangebasedupontheoutcomeofthe

proposalorbidevaluation,andwhohavenegotiatedadraft

contractthatwillbecometheactualcontractwhen anaward

ismade.

Final

a roval

of

all

com lex

hi h

value

hi h

risk

procurementswillgenerally requireorganizationalsenior

managementapprovalpriortoaward.



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p

.2ProcurementContractAward

A

procurement

contract

is

awarded

to

each

selected

seller.

The contractcan be intheformofsimplepurchaseorderor

acomplexdocument.Regardlessofthedocuments

complexity,acontractisamutuallybindinglegalagreement

thatobli ates

the

seller

to

rovide

the

s ecified

roducts

services,orresults,andobligates thebuyertocompensate

theseller.Acontractisalegalrelationshipsubjecttoremedy

.

willvary,

but

will

sometimes

include

the

following:



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p

Statementofworkordeliverables,

Performance

reporting, Periodofperformance,

Rolesandresponsibilities,

Sellersplaceofperformance,

Pricing,

Paymentterms,

aceo e very,

Inspectionandacceptancecriteria,

,


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Contract Document


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ContractDocument

Purposeofcontract: Todefineroleandresponsibilities

Tomakethingslegallybinding

Tomitigate

or

allocate

risks.

Contracthasmanynamesandtypesfromsimpleto

complexdocument ,

,

,

Alegalcontract willneed.. Anoffer

Acceptance

Consideration(Somethingofvalue,notnecessarymoney)

,

Legalpurpose(Wecannothaveacontractforsomethingillegal)

ContractDocument


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o ac ocu e

Contractdocumentusuallyincludes:

Schedulebaseline

Performancereporting

Role&responsibilities

Sellersplaceofperformance

Paymentterms

Placeofdelivery

Warranty

AdministerProcurements


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Administer Procurements isthe processofmanaging

procurement relationships,monitoring contractperformance,

andmakingchangesandcorrectionsasneeded.

Boththebuyerandthesellerwilladministerthe

procurementcontractforsimilarpurposes.

Eachmustensurethatbothpartiesmeettheircontractual

obligationsandthattheirownlegalrightsareprotected.

TheAdministerProcurementsprocessensuresthatthe

thatthebuyerperformsaccordingtothetermsofthelegal

contract.



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Thelegalnatureofthecontractualrelationshipmakesit

imperativethattheprojectmanagementteamisawareofthe

legalimplicationsofactionstaken whenadministeringany

procurement.

Onlargerprojectswithmultipleproviders,akeyaspectof

contractadministration

is

mana in

interfaces

amon

the

variousproviders.



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12.3.1AdministerProcurements :Inputs


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.1 ProcurementDocuments

Procurementdocumentscontaincompletesupportingrecords

foradministrationoftheprocurementprocesses.

Thisincludesprocurementcontractawardsandthestatement

ofwork.

.2ProjectManagementPlan

.4Performance

Reports

.5 ApprovedChangeRequests

.6WorkPerformanceInformation

12.3.2AdministerProcurements :ToolsandTechniques


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.1 ContractChangeControlSystem

Acontractchangecontrolsystemdefinestheprocessbywhich

theprocurementcanbemodified.

Itincludesthepaperwork,trackingsystems,disputeresolution

,

changes.

Thecontract

change

control

system

is

integrated

with

the

integrated changecontrolsystem.



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.2ProcurementPerformanceReviews

A rocurement erformancereviewisastructuredreviewofthesellers

progresstodeliverprojectscopeandquality,withincostandonschedule,

ascompared

to

the

contract.

Itcanincludeareviewofsellerprepareddocumentationandbuyer

inspections,aswellasqualityauditsconductedduringsellersexecutionof

thework.

Theobjectiveofaperformancereviewistoidentifyperformancesuccesses

and

contract

non

compliance,

which

allow

the

buyer

to

quantify

the

sellersdemonstratedabilityorinabilitytoperformwork.

Suchreviewsmaytakeplaceasapartofprojectstatusreviewswhich

would

include

key

suppliers.



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.3 InspectionsandAudits

Inspectionsandauditsrequiredbythebuyerandsupportedby

thesellerasspecifiedintheprocurementcontractcan beconductedduringexecutionofthe projecttoverify

complianceinthesellersworkprocessesordeliverables.

Ifauthorizedbycontract,someinspectionandauditteamscan

includebuyerprocurementpersonnel.



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.4PerformanceReporting

informationabouthoweffectively thesellerisachievingthe

contractualobjectives.

.5 PaymentSystems

payablesystemofthebuyeraftercertificationofsatisfactory

workbyanauthorizedpersonontheprojectteam.All

paymentsshouldbemadeanddocumentedinstrict

accordancewith

the

terms

of

the

contract.



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6ClaimsAdministration

Contestedchangesandpotentialconstructivechangesarethoserequestedchanges

wherethe

buyer

and

seller

cannot

reach

an

agreement

on

compensation

for

the

change,orcannotagreethatachangehasoccurred.

Thesecontestedchangesarevariouslycalledclaims,disputes,orappeals.Claims

aredocumented,processed,monitored,andmanagedthroughoutthecontractlife

cycle,usuallyinaccordancewiththetermsofthecontract.

Iftheparties themselvesdonotresolveaclaim,itmayhavetobehandled in

accor ancew t a ternat ve sputereso ut on typ ca y o ow ngproce ures

establishedin

the

contract.

.



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.7 RecordsManagementSystem

Arecordsmanagementsystemisusedbytheprojectmanager

tomanagecontractandprocurementdocumentationandrecords.

,

functions,andautomationtoolsthatareconsolidatedand

combinedaspartoftheprojectmanagementinformation

system

y v v

documents andcorrespondence.

12.3.3AdministerProcurements :Outputs


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.1 ProcurementDocumentation

Procurement documentationincludes,butisnotlimitedto,

the procurementcontractwithallsupportingschedules,requestedunapproved contract changes,andapproved

change requests.

Procurementdocumentationalsoincludesanyseller

developedtechnicaldocumentationandotherwork

performanceinformationsuch asdeliverables,seller

performancereports,

warranties,

financial

documents

includin invoicesand a mentrecords andtheresultsof

contractrelatedinspections.

12.3.3AdministerProcurements :Outputs


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.2OrganizationalProcess AssetsUpdates

.4ProjectManagementPlanUpdates

CloseProcurements


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CloseProcurements isthe processofcompleting each

projectprocurement.

ItsupportstheCloseProject orPhaseprocess,sinceitinvolvesverification thatallworkanddeliverables were

acceptable.

CloseProcurements


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12.4.1CloseProcurements :Inputs


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.1 ProjectManagementPlan

Toclosethecontract,allprocurementdocumentationis

collected,indexed,andfiled.Informationoncontract

schedule,scope,quality,andcostperformancealong withall

,

,inspection resultsarecataloged.

Thisinformationcanbeusedforlessonslearned information

andasabasisforevaluatingcontractorsforfuturecontracts.

12.4.2CloseProcurements :ToolsandTechniques


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.1 Procurement Audits

Aprocurementauditisastructuredreviewofthe

procurementprocess

originating

from

the

Plan

Procurements

processthroughAdministerProcurements.

andfailuresthatwarrantrecognitioninthepreparationor

administrationofotherprocurementcontractsontheproject,

oronotherprojectswithintheperformingorganization.

12.4.2CloseProcurements :ToolsandTechniques


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.2NegotiatedSettlements

Inallprocurementrelationshipsthefinalequitable settlement

ofall

outstanding

issues,

claims,

and

disputes

by

negotiation

is

aprimarygoal.Wheneversettlementcannotbeachieved

throughdirectnegotiation,someformofalternativedispute

resolution

ADR

includin

mediation

or

arbitration

ma

be

explored.

Whenallelsefails,litigationinthecourts istheleastdesirable

option.

.

12.4.3CloseProcurements :Outputs


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.1 ClosedProcurements

administrator,providesthesellerwithformalwrittennotice

thatthe

contract

has

been

completed.

Requirementsforformalprocurementclosureareusually

includedintheprocurementmanagementplan.

.2OrganizationalProcess AssetsUpdates

Termstoconditions(A)


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ACCEPTANCE

Theactofacceptingbyanauthorizedrepresentative; anindicationofawillingnesstopay;theassumptionofalegal

obligationbyapartytothetermsandconditionsofacontract.

Theactofacquiringgoodsandservices(includingconstruction)fortheuseofagovernmentalactivitythroughpurchase,rent,

orlease.Includestheestablishmentofneeds,descriptionofrequirements,selectionofprocurementmethod,selectionof

sources,

solicitation

of

procurement,

solicitation

for

offers,

award

of

contract,

financing,

contraction

administration,

and

relatedfunctions.

ADDENDUM

Anadditionorsupplementtoadocument;e.g.,itemsorinformationaddedtoaprocurementdocument.

ADVERTISE

Tomakeapublicannouncementoftheintentiontopurchasegoods,servicesorconstructionwiththeintentionofincreasing

theresponseandenlargingthecompetition.Theannouncementmustconformtothelegalrequirementsimposedby

established

laws,

rules,

policies

and

procedures

to

inform

the

public.

AGREEMENT

Adulyexecutedandlegallybindingcontract;theactofagreeing.

ALP

AuthorityforLocalPurchase:grantedbythecommissionerofAdministration toanindividualwhohassuccessfullycompleted

allrequirementsestablishedbytheMaterialsManagementDivision.

ALTERNATERESPONSE

Asubstitute

response;

an

intentional

substantive

variation

to

abasic

provision

or

clause

of

asolicitation

by

avendor.

AMENDMENT/CHANGEORDER

Awrittenmodificationtoacontractorpurchaseorderorotheragreements.

Sumofmoneyfrompublicfundssetasideforaspecificpurpose.

ARO

AfterReceiptofOrder.

Termstoconditions(B)


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BESTVALUE

Aresultintendedintheacquisitionofallgoodsandservices.Pricemustbeoneoftheevaluationcriteriawhenacquiring

goodsandservices.Otherevaluationcriteriamayinclude,butarenotlimitedtoenvironmentalconsiderations,quality,and

vendor erformance.

BILLOFLADING

Awrittenreceiptorcontract,givenbyacarrier,showingalistofgoodsdeliveredtoitfortransportation.Thestraightbill of

lading

is

a

contract

which

provides

for

direct

shipment

to

a

consignee.

The

order

bill

of

lading

is

negotiable;

it

enables

a

shippertocollectforashipmentbeforeitreachesitsdestination(thisisdonebysendingtheoriginalbillofladingwith adraft

drawnontheconsigneethroughabank).Whentheconsigneereceivestheladingindicatingthatpaymenthasbeenmade,

theladingwillbesurrenderedtothecarrier'sagent,andthecarrierwillthenshipthegoodstotheconsignee,andthebillof

ladingwillbesurrenderedtothecarrier.Note:Shippersfrequentlyconsignshipmentstothemselvesonorderbillsoflading so

thatdeliveryismadeonlyupontheshipper'sorder;thepersonorfirmtobenotifieduponarrivaloftheshipmentat

destinationmustbedesignated.

BLANKETORDER

Acontract

under

which

avendor

agrees

to

provide

goods

or

services

on

apurchase

on

demand

basis.

The

contract

generally

establishesprices,terms,conditionsandtheperiodcovered(noquantitiesarespecified);shipmentsaretobemadeas

requiredbythepurchaser.

"BRANDNAMEOREQUAL"SPECIFICATION

Aspecificationthatusesoneormoremanufacturersbrandnamesorcatalognumberstodescribethestandardsofquality,

per ormancean ot erc aracter st csnee e tomeett erequ rementso aso c tat onan prov e ort esu m ss ono

equivalentproducts.

BROKER

Abusinessthatcarriesnoinventoryandthathasnowrittenongoingagreementwithanymanufacturerormanufacturer's

authorizeddistributortoselltheproductsofthemanufacturer.

BUSINESS

Acontractor,subcontractor,supplier,consultant,orprovideroftechnical,administrative,orphysicalservicesorganizedasa

soleproprietorship,partnership,association,corporation,orotherentityformedforthepurposeofdoingbusinessforprofit.

Termstoconditions(C)


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COMMODITY

Atransportablearticleoftradeorcommercethatcanbebarteredorsold.

COMMODITY/SERVICECONTRACT

" " . ,

thecomputersystem.An"M"numberisnolongerassignedforthesetypesofcontracts.

COMPREHENSIVEPROCUREMENTGUIDELINES(CPG)

Designatesitems

that

must

contain

recycled

content

when

purchased

by

federal,

state,

and

local

agencies,

or

by

contractors

usingappropriatedfederalfunds,whentheseagenciesspendmorethan$10,000ayearonanyofthedesignateditems.For

exam le if a state a enc s ends more than 10 000 a ear on co a er and art of that mone is from a ro riated

federalfunds,thenthatstateagencymustfollowtheEPSguidelinesandbuy30percentpostconsumerrecycledpaper.

(Section6002oftheResourceConservationandRecoveryAct[RCRA]andPresidentialExecutiveOrder13101.)

CONSIDERATION

Somethingofvaluegivenordoneasrecompensethatisexchangedbytwoparties;thatwhichbindsacontract.

Anywritteninstrumentorelectronicdocumentcontainingtheelementsofoffer,acceptance,andconsiderationtowhichan

agencyisaparty.

CONTRACTADMINISTRATION

Themanagementofallactionsaftertheawardofacontractthatmustbetakentoassurecompliancewiththecontract;e.g.,

timelydelivery,acceptance,payment,closingcontract,etc.

CONTRACTOR

A

person

who

agrees

to

furnish

goods

or

services

for

a

certain

price;

may

be

a

prime

contractor

or

subcontractor.

COOPERATIVEPURCHASING

Thecombiningofrequirementsoftwoormoregovernmentalunitstoobtainthebenefitsofvolumepurchasesand/or

reductioninadministrativeex enses.

COOPERATIVEPURCHASINGVENTURE(CPV)

AjointpurchasingprogramdesignedbytheStateofMinnesotawheregovernmentalunitsobtainthebenefitsofvolume

purchasingand/orreductioninadministrativeexpensesbyparticipatingintheprogramandpurchasingfromexistingStateof

Minnesota

commodity

contracts.

Termstoconditions(D)


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DEALER,JOBBERORDISTRIBUTOR

Abusinessthatmaintainsastore,warehouse,orotherestablishmentinwhichalineorlinesofproductsarekeptininventory

andaresoldtothepubliconawholesaleorretailbasis.

Thedisqualificationofapersontoreceiveinvitationsforbidsorrequestsforproposals,ortheawardofacontractbya

governmentbody,foraspecifiedtimecommensuratewiththeseriousnessoftheoffense,thefailure,ortheinadequacyof

performance.

DEFAULT

Failure b a art to a contract to com l with contractual re uirements.

DELIVERY

Theformalhandingoverofproperty;thetransferofpossession,suchasbycarriertopurchaser.

DEMURRAGE

Thedetentionofaship,railroad,carortruckbeyondaspecifiedtimeforloading/unloading;thepaymentrequiredandmade

. DESIGNSPECIFICATION

Aspecificationsettingforththerequiredcharacteristicstobeconsideredforawardofcontract,includingsufficientdetailto

showhowtheproductistobemanufactured.

DESTINATION

.

DOCUMENTTYPE

MAPSProcurement

uses

document

type

to

differentiate

among

different

functions

for

arequisition,

solicitation,

contract,

or

order.Thedocumenttypeisafieldtobeenteredonthosescreensthatareforrequisitionsolicitation,contract,ororder.

DROPSHIPMENT

notmaintainaninventory.

Termstoconditions(E)


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ECONOMICALLYDISADVANTAGEDAREABUSINESS(ED)

Smallbusinesseligibleforcertificationassociallydisadvantagedbusinessoreconomicallydisadvantagedareabusiness:A

smallbusinessentitywithitsprincipalplaceofbusinessinMinnesotaorganizedforprofit,includinganindividual,

artnershi cor oration ointventure association orcoo erativethatis51 ercentownedandiso erationall controlled

onadaytodaybasisbycitizensoftheUnitedStates.TheareasofeconomicdisadvantagearedeterminedbytheUS

DepartmentofLabor.

EMERGENCY

ACQUISITIONAthreattopublichealth,welfare,orsafetythatthreatensthefunctioningofgovernment,theprotectionofpropertyorthe

healthorsafetyofpeople.

ENERGYSTAR

Afederalstandardappliedtoofficeequipmentforthepurposeofratingtheenergyefficiencyoftheequipment.EnergyStar

computers,monitors,andprinterssaveenergybypoweringdownandgoingto"sleep"whennotinuse,resultingina

reductioninelectricalbillsandpollutionlevels.

ENVIRONMENTALLYPREFERABLEPRODUCT(EPP)

Aproductorservicethathasalesserorreducedimpactonhumanhealthandtheenvironmentwhencomparedwith

competingproductsorservicesthatservethesamepurpose.Suchproductsorservicesmayinclude,butarenotlimitedto

thosewhichcontainrecycledcontent,minimizewaste,conserveenergyorwater,andreducetheamountoftoxicseither

disposedoforconsumed.

EQUALORAPPROVEDEQUAL

Usedtoindicatethatanitemmaybesubstitutedforarequireditemifitisequalinquality,performanceandother

characteristics.

ESCALATIONCLAUSE

Acontractprovisionwhichpermitstheadjustmentofcontractpricesbyanamountorpercentifcertainspecified

contingenciesoccur,suchaschangesinthevendor'srawmaterialorlaborcosts.

EVALUATIONOFRESPONSES

Theexaminationofresponsesafteropeningtodeterminethevendor'sresponsibility,responsivenesstorequirements,and

othercharacteristicsofthesolicitationrelatingtotheaward.

Termstoconditions(FJ)


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FISCALYEAR

The12monthsbetweenoneannualsettlementoffinancialaccountsandthenext;atermusedforbudgeting,etc.Thefiscal

yearfortheU.S.GovernmentisOctober1toSeptember30;thefiscalyearfortheStateofMinnesotaisJuly1toJune30.

Statepropertythatisinoneoffourcategories: allnonexpendablepropertyhavinganormallifeexpectancyofmorethantwoyearsandavalueof$2,000ormore.

allsemiexpendablepropertyestablishedbytheowningagency'spolicyasfixedassets:anyitemhavinganormallifeexpectancy ofmorethantwoyearsandavalueoflessthan

$2,000.

allfirearms,regardlessoftheirvalue.

allsensitiveitems,asestablishedbytheagencypolicy.

FORMALSOLICITATION

Asolicitationwhichrequiresasealedresponse.

GOODS

Alltypesofpersonalpropertyincludingcommodities,materials,supplies,andequipment.

HAZARDOUSWASTE

Anywaste(solid,liquid,orgas)whichbecauseofitsquantity,concentration,orchemical,physical,orinfectious

characteristicsposeasubstantialpresentorpotentialhazardtohumanhealthortheenvironmentwhenimproperlytreated,

stored,transported,ordisposedof.

INFORMALSOLICITATION

Asolicitationwhichdoesnotrequireasealedresponse.

INSURANCE

Acontractbetweenaninsurancecompanyandapersonorgroupwhichprovidesforamoneypaymentincaseofcovered

loss,accidentordeath.

INVOICE

Alistofgoodsorservicessenttoapurchasershowinginformationincludingprices,quantitiesandshippingchargesfor

payment.

JOINTVENTURE

Thetemporaryassociationoftwoormorebusinessestosecureandfulfillaprocurementbidaward.


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Termstoconditions(M)


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MANDATORY

Requiredbytheorderstipulated,e.g.,aspecificationoraspecificdescriptionthatmaynotbewaived.

MAPS

.

ProcurementsideofthesystemandGFSisreferredtowhenspeakingoftheaccountingside.

MANUFACTURER

Abusiness

that

makes

or

processes

raw

materials

into

afinished

product.

MARKET

. ,

analyze,advertise,package,etc.

MATERIALVARIANCE/MATERIALDEVIATION

Avarianceordeviationinaresponsefromspecificationsofconditionsthatallowsaresponderasubstantialadvantageor

benefitnotenjoyedbyallotherrespondersorthatgivesthestatesomethingsignificantlydifferentfromwhatthestate

.

MATERIALSMANAGEMENT

Embracesallfunctionsofacquisition,standards,qualitycontrolandsurpluspropertymanagement.

MODELPROCUREMENTCODE(MPC)

ApublicationapprovedbytheAmericanBarAssociationwhichsetsforthprocurementstatutoryprinciplesandpolicy

,

administrativeandjudicialremediesfortheresolutionofcontroversiesrelatingtopubliccontracts;andasetofethical

standards

governing

public

and

private

participants

in

the

procurement

process.

MULTIPLEAWARD

Contractsawardedtomorethanonesupplierforcomparablesuppliesandservices.Awardsaremadeforthesamegeneric

t esofitemsatvarious rices.

Termstoconditions(N)


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NAICS(NORTHAMERICANINDUSTRYCLASSIFICATIONSYSTEM)CODE[FORMERLYKNOWNASSIC(STANDARDINDUSTRIAL

CLASSIFICATION)CODE]

Classificationofbusinessestablishedbytypeofactivityforthepurposeoffacilitatingthecollection,tabulation,presentation,

andanal sisofdatacollectedb variousa enciesoftheUnitedStates overnment statea encies tradeassociations and

privateresearchorganizationsforpromotinguniformityandcomparabilityinthepresentationofstatisticaldatarelatingto

thoseestablishmentsandtheirfieldsofendeavor.

NAPM

NationalAssociationofPurchasingManagement.Anonprofiteducationalandtechnicalorganizationofpurchasingandmaterialsmanagementpersonnelandbuyingagenciesfromthepublicandprivatesectors.

NASPO

NationalAssociationofStatePurchasingOfficials.Anorganizationofstateprocurementrepresentativesforthepurposeof

promotingefficientandeffectivepublicpurchasingpoliciesandproceduresatthestatelevel.NASPOisanaffiliateofthe

ControlofStateGovernments(CSG).

NEGOTIATION

Requestsforproposalsaresometimesusedasastartingpointfornegotiationstoestablishacontract.RFPsgenerallyincludemorethanjustpriceconsiderations.Thismethodisespeciallyapplicablewhendealingwithasinglesourcemanufacturer.

NETPRICE

Priceafteralldiscounts,rebates,etc.,havebeenallowed.

NIGP

NationalInstituteofGovernmentalPurchasing.Anonprofit,educationalandtechnicalassistancecorporationofpublic

purchasingagenciesandactivitiesatthefederal,stateandlocallevelsofgovernment.

NOBID

Aresponsetoasolicitationforbidsstatingthatrespondentdoesnotwishtosubmitanoffer.Itusuallyoperatesasa

procedureconsiderationtopreventsuspensionfromthevendorslistforfailuretosubmitaresponse.

Termstoconditions(OP)

OPEN MARKET REQUISITION (OMR)


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OPENMARKETREQUISITION(OMR)

TherequisitiondocumenttypeusedinMAPSProcurementtorequestthepurchaseofanoncontractitemwhenthe

requesteditem'sestimatedcostexceedstheauthorityforpurchaselevelofthebuyer.AnOMRconveystherequestfor

urchasetothe ersonwiththeauthorit to urchase.Theresultin ordert eismostoftenthePurchaseOrderRe uisition

(POR).

OPTIONTOEXTEND/RENEW

Aprovision(orexerciseofaprovision)whichallowsacontinuanceofthecontractforanadditionaltimeaccordingto

permissiblecontractualconditions.

OSHA

TheOccupationalSafetyandHealt

PACKINGLIST

Adocumentwhichitemizesindetailthecontentsofaparticularpackageorshipment.

PARTIALPAYMENT

oneormoredistinctitemsofservicecalledforthereunder.

PERDIEM

Bytheday.

PERFORMANCEBOND

,

vendor'sinabilitytocompletethecontractasagreed.

PERFORMANCESPECIFICATION

Aspecificationsettingforthperformancerequirementsdeterminednecessaryfortheiteminvolvedtoperformandlastas

required.

Aproductderivedfromrenewableresources,includingfibercrops,suchaskenaf;chemicalextractsfromoilseeds,nuts,fruits

andvegetables(suchascornandsoybeans);agriculturalresidues,suchaswheatstrawandcornstover;andwoodwastes

generatedfromprocessingandmanufacturingoperations.Theseproductsstandincontrasttothosemadefromfossilfuels

(suchaspetroleum)andotherlessrenewableresources(suchasvirgintimber).

Termstoconditions(P)

POINT OF ORIGIN


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POINTOFORIGIN

(shippingpoint)

Thelocationwhereashipmentisreceivedbyatransportationlinefromtheshipper.

Asubdivisionofastatewhichhasbeendelegatedcertainfunctionsoflocalgovernment.Canincludecounties,cities,towns,

villages,hamlets,boroughsandparishes.

POST

CONSUMER

MATERIALAfinishedmaterialwhichwouldnormallybedisposedofasasolidwasteafteritslifecycleasaconsumeritemiscompleted.

Does not include manufacturin or convertin wastes. This refers to material collected for rec clin from office buildin s

homes,retailstores,etc.

PRECONSUMERMATERIAL

Materialorbyproductsgeneratedafterthemanufactureofaproductbutbeforetheproductreachestheconsumer,suchas

damagedorobsoleteproducts.Preconsumermaterialdoesnotincludemillandmanufacturingtrim,scrap,orbroken

materialwhichisgeneratedatamanufacturingsiteandcommonlyreusedonsiteinthesameoranothermanufacturing

process.

PREFERENCE

Anadvantageinconsiderationforawardforacontractgrantedtoavendorbyreasonofthevendor'sresidence,business

location,orbusinessclassifications(e.g.,minority,smallbusiness).

PREPAID

Atermdenotingthattransportationchargeshavebeenoraretobepaidatthepointofshipment.

PREQUALIFICATIONOFVENDORS

Thescreeningofpotentialvendorsinwhichsuchfactorsasfinancialcapability,reputationandmanagementareconsidered

whendevelopingalistofqualifiedvendors.SeeVendorsList,QualifiedVendor/Responsible Vendor.

Termstoconditions(P)

PRICE


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PRICE

Theamountofmoneythatwillpurchaseadefiniteweightorothermeasureofacommodity.

PRICEAGREEMENT

'

predeterminedprice.Usuallyinvolvesaminimumnumberofunits,ordersplaceddirectlywiththevendorbythepurchase,

andlimiteddurationofthecontract.SeeBlanketOrderandRequirementsContract.

PRICE

FIXINGAgreementamongcompetingvendorstosellatthesameprice.

Thecombinedfunctionsofpurchasing,inventorycontrol,trafficandtransportation,receiving,inspection,storekeeping,and

salvageanddisposaloperations.

PROPRIETARY

Theonlyitemsthatcanperformafunctionandsatisfyaneed.Thisshouldnotbeconfusedwith"singlesource."Anitemcan

.

,

,

onlylensthatwillfitisaNikonlens,thus,thislensis"proprietary."However,theNikonlensisavailablefrommorethanone

source,thus,itisnotsinglesource.

PUBLICPURCHASING

Theprocessofobtaininggoodsandservicesforpublicpurposefollowingproceduresimplementedtoprotectpublicfunds

frombeingexpendedextravagantlyorcapriciously.

PURCHASEMANUAL

Adocumentthatstipulatesrulesandprescribesproceduresforpurchasingwithsuppliersandotherdepartments.

PURCHASEORDER

Thesignedwrittenacceptanceoftheofferfromthevendor.Apurchaseorderservesasthelegalandbindingcontract

betweenboth arties.


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Termstoconditions(R)

REQUEST FOR BID (RFB)


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REQUESTFORBID(RFB)

Asolicitationinwhichtheterms,conditions,andspecificationsaredescribedandresponsesarenotsubjecttonegotiation.

REQUESTFORPROPOSAL(RFP)

,

responsesaresubjecttonegotiation.Pricemustbeafactorintheawardbutnotthesolefactor.

REQUIREMENT

Materials,

personnel

or

services

needed

for

a

specific

period

of

time.

REQUIREMENTSCONTRACT

,

estimateorwithinmaximumandminimumlimitswithdeliveriesondemand.

REQUISITION

Aninternaldocumentthatafunctionaldepartment(stores,maintenance,production,etc.)sendstothepurchasing

departmentcontainingdetailsofmaterialstomeetitsneeds,replenishstocksorobtainmaterialsforspecificjobsor

.

RESIDENTVENDOR

Aperson,firm,orcorporationauthorizedtoconductbusinessintheStateofMinnesotaonthedateasolicitationfora

contractisfirstadvertisedorannounced.Itincludesaforeigncorporationdulyauthorizedtoengageinbusinessin

Minnesota.

Onewhosubmitsaresponsetoasolicitationdocument.

RESPONSETheofferreceivedfromavendorinresponsetoasolicitation.Aresponseincludessubmissionscommonlyreferredtoas

"offers,""bids,""quotes,"or"proposals."

Abidderwhosereputation,pastperformance,andbusinessandfinancialcapabilitiesaresuchthatthebidderwouldbe

judgedbyanappropriateauthorityascapableofsatisfyinganorganization'sneedsforaspecificcontract.

Termstoconditions(RS)

RESTRICTIVESPECIFICATIONS


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Specificationsthatunnecessarilylimitcompetitionbyeliminatingitemscapableofsatisfactorilymeetingactualneeds.See

PerformanceSpecification.

Anyproductdesignedtobeusedmanytimesforthesameorotherpurposewithoutadditionalprocessingotherthanspecific

requirements,suchascleaning,paintingorminorrepairs.

RFP

OR

RFB

CONFERENCEAmeetingarrangedbyaprocurementofficetohelppotentialbiddersunderstandtherequirementsofanRFBoranRFP.

Alevyonavendor'ssalebyanauthorizedlevelofgovernment.

SEALED

Amethoddeterminedbythecommissionertopreventthecontentsbeingrevealedorknownbeforethedeadlinefor

submissionofresponses.

Unlessotherwiseindicated,bothprofessionalortechnicalservicesandserviceperformedunderaservicecontract.

SINGLESOURCE

Anacquisitionwhere,afterasearch,onlyonesupplierisdeterminedtobereasonablyavailablefortherequiredproduct,

serviceorconstructionitem.

Adesignationforcertainstatutorypurposesreferringtoafirm,corporationorestablishmenthavingasmallnumberof

employees,

low

volume

of

sales,

small

amount

of

assets

or

limited

impact

on

the

market.

SOLICITATION

Theprocessusedtocommunicateprocurementrequirementsandtorequestresponsesfrominterestedvendors.A

, .

SOURCEREDUCTIONPRODUCT

Aproductthatresultsinanetreductioninthegenerationofwaste,andincludesdurable,reusableandremanufactured

products;productswithnopackagingorreducedpackaging.

Termstoconditions(ST)

SPECIFICATION


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Aconcisestatementofasetofrequirementstobesatisfiedbyaproduct,materialorprocessthatindicateswhenever

appropriatetheprocedurestodeterminewhethertherequirementsaresatisfied.Asfaraspracticable,itisdesirablethatthe

re uirementsareex ressednumericall intermsofa ro riateunits to etherwiththeirlimits.As ecificationma bea

standard,apartofastandard,orindependentofastandard.

STANDARD

Anitem'scharacteristicorsetofcharacteristicsgenerallyacceptedbythemanufacturersandusersoftheitemasarequired

characteristicfor

all

such

items.

STANDARDIZATION

Theprocessofdefiningandapplyingtheconditionsnecessarytoensurethatagivenrangeofrequirementscannormallybe

met,withaminimumofvariety,inareproducibleandeconomicmannerbasedonthebestcurrenttechniques.

SURPLUSPROPERTY

Propertyinexcessoftheneedsofanorganizationandnotrequiredforitsforeseeableuse.Surplusmaybeusedornew,butit

possessessomeusefulnessforthepurposeitwasintendedorforsomeotherpurpose.

TABULATIONOFRESPONSES

Therecordingofresponsesforthepurposesofcomparison,analysisandrecordkeeping.

TARGETEDGROUPBUSINESS(TG)

AcertifiedbusinessdesignatedbythecommissionerofAdministration thatismajorityownedandoperatedbyawoman,

personwithdisabilities,oramemberofaspecificminoritygroupwhoprovidesgoods,products,orserviceswithin

purchasingcategoriesdesignatedbythecommissioner.

TERMSANDCONDITIONS

Aphrasegenerallyappliedtotherulesunderwhichallbidsmustbesubmittedandthestipulationsincludedinmostpurchase

contracts;oftenpublishedbythepurchasingauthoritiesfortheinformationofallpotentialvendors.

TITLE

Theinstrumentordocumentwherebyownershipofpropertyisestablished.

Termstoconditions(TV) TORT

Awrongful

act,

other

than

abreach

of

contract,

such

that

the

law

permits

compensation

of

damages.

TRUCKLOAD (TL)


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TRUCKLOAD(TL)

1.Aquantityoffreighttowhichtruckloadratesapplyorashipmenttenderedasatruckload.

2.Ahighwaytruckortrailerloadedtoitscarryingcapacity.SeeLessThanTruckload.

UNIFORMCOMMERCIALCODE(UCC)

Acomprehensivemodernizationofvariousstatutesrelatingtocommercialtransactions,includingsales,lease,negotiable

instruments,bankdepositsandcollections,fundstransfers,lettersofcredit,bulksales,documentsoftitle,investment

securitiesand

secured

transactions.

The

Minnesota

law

is

found

in

Minn.

Stat.

Ch.

336.

UNITPRICE

Thepriceofaselectedunitofagoodorservice(e.g.,pound,laborhours,etc.).

UNSUCCESSFULVENDOR

Avendorwhoseresponseisnotacceptedforreasonssuchasprice,quantity,failuretocomplywithspecifications,etc.

VALUEANALYSIS

Anorganizedeffortdirectedatanalyzingthefunctionofsystems,products,specifications,standards,practices,and

proceduresfor

the

purpose

of

satisfying

the

required

function

at

the

lowest

total

cost

of

effective

ownership

consistent

with

therequirementsforperformance,reliability,qualityandmaintainability.

VENDOR

Someonewhosellssomething;a"seller."

VENDORSLIST

Alistofnamesandaddressesofsuppliersfromwhombids,proposalsandquotationsmightbeexpected.Thelist,maintained

bythepurchasingoffice,shouldincludeallsupplierswhohaveexpressedinterestindoingbusinesswiththegovernment.

VIRGINPRODUCT

Aproductthatismadewith100percentnewrawmaterialsandcontainsnorecycledmaterials.

VOLATILEORGANICCOMPOUNDS(VOCs)

Compoundsthatevaporateeasilyatroomtempuratureandoftenhaveasharpsmell.Theycancomefrommanyproducts,

suchasofficeequipment,adhesives,carpeting,upholstery,paints,solvents,andcleaningproducts.SomeVOCscancause

cancerincertainsituations,especiallywhentheyareconcentratedindoors.VOCsalsocreateozone,aharmfuloutdoorair

pollutant.

Termstoconditions(W)

WARRANTY


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Therepresentation,eitherexpressedorimplied,thatacertainfactregardingthesubjectmatterofacontractispresentlytrue

orwillbetrue.Nottobeconfusedwith"guarantee,"whichmeansacontractorpromisebyonepersontoanswerforthe

erformanceofanother erson.

For more information do not hesitate to


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Formore

information

do

not

hesitate

to

contactme.

AhmadH.

Maharma

PMP

Ramallah,Palestine

Phone:+(972)(2)2968644

Mobile:+(972)(599)001155

EMail:[email protected]

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