Ryerson University Project Management Certificate by pluggone

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									             Ryerson University
       Project Management Certificate
         Procurement and Contracts Overview
                  presented to the
                    PMI-ISLIG
Operational        Nov 11, 2004
Risk                     by
Business        Desmond P. Alvares
Intelligence    des_alvares@bcs.org.uk
                     416 258 7178
Tools
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                                                               Continuing Education Division



         Introduction – Who Am I
                                                               Ryerson University




    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)

O
       Chartered IT Professional – UK (2004)
       19 years Business Intelligence and Knowledge Management in
        Canada, UK, US, Switzerland and Caribbean
R      10 years Investment Banking (Brokerage Houses, Private Banking
        and Oil &Gas trading)

B      6 years Retail Banking (Technology Business Management,
        Operational Risk, Electronic Banking and Mortgages, Finance and
        Treasury Systems)
I      3 years Property and Casualty Insurance (Finance and Actuarial
        Systems)

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    Introduction – PM Background
    • Financial Systems Implementations
    • Business, Training, Finance and Treasury Projects
    • Internal and Client Facing Projects
    • Internal Providers and Integration of Vendor Solution
O   • Introduced and Developed Project Management
      Methodology – UBS Private Banking (International

R
      locations base on Swiss framework) and CIBC Retail
      (PMP based on the PMI framework)
    • Lecturer at Ryerson University – Project Management
B     Certificate (Construction, IT and Financial Service
      students) and Architecture specialization in Project
I     Management.

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                                                 Ryerson University


                     Agenda
    •   Introduction
    •   The Certificate Program at Ryerson
    •   The Procurement Process
    •   Planning
O   •   Solicitation
R   •   Source Selection
B   •   Contract Administration
I   •   Close-out
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                                                                       Ryerson University


         Other Offerings of Project
           Management Courses
    • Athabasca University
       – Executive MBA in Project Management (on-line and residence)
    • Centennial College
       – Project Management Certificate (6 courses)
       – Advanced Project Management Certificate (4 courses)

O   • Durham College
       – Intro, Scheduling Software, Statistics


R
    • Humber College
       – Project Management Certificate (4 courses, 45hrs)
    • University of Toronto
B      – Project Management Certificate (4 courses, full day)
    • York University
I      – The Graduate Certificate in Project Management (8 courses)



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    The Ryerson Offer (8 Courses)
    • Core Courses
       – CKPM202 Fundamentals of Project Management
       – CKPM203 Planning and Scheduling
       – CKPM205 Procurement and Contracts
       – CKPM209 Project Risk and Quality Management
       – CKPM210 Project Leadership

O      – CKPM211 Project Cost Management
    • Electives

R      – CKPM207 Project Management Systems
       – CKPM208 Analytical Decision Making

B      – CCMN114 Short Management Reports
       – CCMN432 Technical Communications

I      – CMHR405 Organizational Behaviour and Interpersonal Skills
       – CQMS102 Business Statistics I

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                 The Students View
    • 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
O   • Experience 80% (> 5 Years), 25.1% (> 15 Years)
    • 85% interested in becoming professional in 2 years
R   • 85.2% using certificate as preparation, but lack work experience
    • Graduates (61.9% PMI members, 25% PMP), 75% additional
B     prep
    • Risk, cost and planning / scheduling – more theory than practice

I   • Interest in PMO, Leadership and Communication
    • Common text book required, introduce PMP Preparation

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     Definition of the Procurement
                 Process
    • Objectives
      – Technical & Quality
      – Schedule
O     – Cost
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B
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                 Basic Steps

    • Define the Goods and Services to be
      procured
    • Select bidders and Complete Request for
O     Proposal
R   • Prepare Bids and Award Contract
B   • Contract Management
    • Close out Contact
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                  Other Aspects

    •   Role of Project Management
    •   Interfaces with Other Project Processes
    •   Importance of Management
O   •   Ethical Practices
R   •   Principle Types
B       – Standard, Material, Equipment & Services
I   • Definitions of Common Terms
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    Organizations for Procurement
    • Organization
      –   Project Managers responsibility
      –   Procurement department – purchasing & materials

O     –
      –
          Responsibilities
          Staffing – direct and matrix
R     –   Procedures
           • Requests, Qualified Bidders, RFP, Contact Management
B     – Management Program
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    Procurement Considerations
    –   What to Procure?
    –   How much to procure?
    –   When to procure?
O   –   Selecting an appropriate method of procurement.
R   –   Qualifying suppliers.
    –
B
        Developing a contracting strategy.
    –   Establishing appropriate performance measures.
I   –   Documenting the procurement project plan.
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    12.1 Plan Purchase and Acquisition
          (Procurement Planning)
                               Project Management Book of Knowledge
                                            Chapter 12
                         Project Procurement Management

O        12.1
    Plan Purchase
    and Acquisition
                         12.2
                         Plan
                      Contracting
                                         12.3
                                     Request Seller
                                      Responses
                                                          12.4
                                                         Select
                                                         Sellers
                                                                       12.5
                                                                     Contract
                                                                   Administration
                                                                                           Contract
                                                                                           Closure


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12.1 PLAN PURCHASE AND ACQUISITION

Inputs                    Tools &           Outputs
Project Charter
                          Techniques
                                            Procurement
Project Scope Statement
                                            Management Plan
Project Management        Make-or-Buy
                          Analysis          Contract Statement
Plan
                                            of Work
WBS and Dictionary        Expert Judgment
                                            Make or Buy
Environment and           Contract Types
                                            Decision
Organization Factors
                                            Project
Organizational Process                      Management
Assets                                      Plan (Updates)
Risk Register
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    12.1.1 Inputs to Plan Purchase
            and Acquisition
     • .1 Project Charter
       – Business needs
     • .1 Project Scope Statement
O      – Project needs and strategies
R    • .2 Project Management Plan
B      – Overall plan for the project

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    12.1.1 Inputs to Plan Purchase
            and Acquisition
     • .3 Work Breakdown Structure and
       Dictionary
       – Relationship of all elements in plan
O    • .4 Environmental and Organizational
R      Factors
       – What is available in the marketplace?
B      – Procurement resources available
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    12.1.1 Inputs to Plan Purchase
            and Acquisition
     • .5 Organizational Process Assets
       – Informal and formal procurement processes
     • .6 Risk Register
O      – Risks , categorization and their mitigation
R
B
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     12.1.2 Tools & Techniques for
     Plan Purchase and Acquisition

    • .1 Make-or-buy analysis
O   • .2 Expert judgment
R   • .3 Contract type selection
B
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    12.1.2.1 Make or Buy Analysis
    • Factors to analyze:
         •   Cost (direct and indirect - lifecycle costs)
         •   Schedule

O        •
         •
             Quality
             Capability & availability of in-house resources
R        •   Supplier skills and abilities

B        •   Degree of control needed by the performing
             organization
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    12.1.2.2 Expert Judgement
     • Other Departments
     • Consultants
     • Professional and Technical
O      Associations
R    • Industry groups
B
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      12.1.2.3 Contract Types
    • Three broad categories of contract
      type:
        • Fixed price or lump sum
          – FFP
O         – FPPI

R       • Cost reimbursable
          – CPFF
B         – CPPF

I         – CPIF
        • Time and Materials (Unit Price)
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        Contract Type vs. Risk Allocation

Scope of Work     Very Little              Partial               Complete
Information

Uncertainty           HIGH              MODERATE                   LOW


 Degree of
 Risk                 HIGH              MODERATE                   LOW


                 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
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             12.1.3 Outputs from Plan              Continuing Education Division
                                                   Ryerson University




             Purchase and Acquisition

    •   .1   Procurement management plan
    •
O       .2   Contract Statement(s) of work
    •   .3   Make-or-Buy Decision
R   •   .4   Project Management plan (update)
B
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     12.1.3.1 Procurement                       Continuing Education Division
                                                Ryerson University




                 Management Plan
    • Defines procurement process
        • Basic requirements
        • Products/services list to procure
O       • Roles and responsibilities
        • Budget
R       • Schedule
B       • Quality criteria
I       • Specifications
        • Contract Desmond Alvares CKPM 205
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        12.1.3.2 Contract Statements of
                     Work
    • A narrative description of the product
    • Clear, concise and as complete as possible
    • Sufficient detail
O   • Allows prospective sellers to determine
R     whether they are capable of providing the
B     product
    • Could be revised and refined throughout
I     the procurement process
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                                                                                    Ryerson University




                      12.2 Plan Contracting
                      (Solicitation Planning)
                               Project Management Book of Knowledge
                                            Chapter 12
                         Project Procurement Management

O        12.1
    Plan Purchase
    and Acquisition
                         12.2
                         Plan
                      Contracting
                                         12.3
                                     Request Seller
                                      Responses
                                                          12.4
                                                         Select
                                                         Sellers
                                                                       12.5
                                                                     Contract
                                                                   Administration
                                                                                           Contract
                                                                                           Closure


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          12.2 Plan Contracting


    • Preparing the documents needed to
      support the solicitation process
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        12.2 PLAN CONTRACTING

Inputs                Tools &           Outputs
                      Techniques
Procurement                             Procurement
Management Plan       Standard Forms    Documents
Contract Statements                     Evaluation
of Work               Expert Judgment   Criteria
Project
                                        Contract
Management Plan
                                        Statement of
Make-or-Buy                             Work (Updates)
Decision
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               12.2.1 Inputs to Plan
                   Contracting
    •   .1   Procurement Management Plan
    •   .2   Contract Statement(s) of work
O   •   .3   Project Management Plan
R   •   .4   Make-or-buy Decision
B
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     12.2.2 Tools & Techniques for
            Plan Contracting
    • .1 Standard forms
      – Standard contracts, bid documents
O
R   • .2 Expert judgement
B
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        12.2.3 Outputs from Plan
               Contracting
    • .1 Procurement documents
    • .2 Evaluation criteria
O   • .3 Contract Statement of work updates
R
B
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    12.2.3.1 Procurement Documents
    • Documents used to solicit proposals
      from prospective vendors
        • Request for Proposal (RFP), Quote(RFQ)
          or Bid (RFB)
O       • Instructions (e.g. desired form of
          response)
R       • Blank contract form
B       • Product description or SOW
I       • Contractual provisions
        • Terms and conditions
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      12.2.3.2 Evaluation Criteria


    • Criteria used to create or score proposals
    • Objective vs. subjective
O   • Weigh the criteria in terms of importance
R
B
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            12.3 Request Seller Responses
                    (Solicitation)
                               Project Management Book of Knowledge
                                            Chapter 12

                  Project Procurement Management
O        12.1
    Plan Purchase
                         12.2
                         Plan
                                         12.3
                                     Request Seller
                                                          12.4
                                                         Select
                                                                       12.5
                                                                     Contract
                                                                                           Contract



R
                                                                                           Closure
    and Acquisition   Contracting     Responses          Sellers   Administration




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    12.3 Request Seller Responses


    • Obtaining the information (bids and/or
      proposals) from the prospective sellers
O   • Most of the actual effort is done by the
R     sellers
B
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      12.3 REQUEST SELLER RESPONSES

Inputs           Tools &       Outputs
                 Techniques
Procurement                    Qualified
Documents                      Sellers List
                 Bidders
Organizational   Conference    Procurement
Process Assets                 Document
                 Advertising   Package
                               Proposals
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      12.3.1 Inputs to Request Seller
                Responses

    • .1 Procurement documents
    • .2 Organizational Process Assets
O
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    12.3.2 Tools & Techniques for
      Request Seller Responses
    • .1 Bidder conferences
        • Used to ensure that all prospective sellers
O         have a common understanding of the
          procurement
R   • .2 Advertising
B       • Used to expand the list of potential sellers
I       • Sometimes required on public projects

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      12.3.3 Outputs from Request
            Seller Responses
    • .1 Qualified seller lists
         • Internally maintained lists

O        • List developed by the project team
    • .2 Procurement Documentation Package
R   • .3 Proposals
B        • Seller-prepared documents that describe the
           seller’s ability and willingness to provide the
I          requested product

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                          12.4 Select Sellers
                          (Source Selection)
                               Project Management Book of Knowledge
                                            Chapter 12
                         Project Procurement Management

O        12.1
    Plan Purchase
    and Acquisition
                         12.2
                         Plan
                      Contracting
                                         12.3
                                     Request Seller
                                      Responses
                                                          12.4
                                                         Select
                                                         Sellers
                                                                       12.5
                                                                     Contract
                                                                   Administration
                                                                                           Contract
                                                                                           Closure


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             12.4 Select Sellers

    • Receipt of bids or proposals
    • Application of the evaluation criteria to
O     select a provider
         • Risk evaluation, lifecycle cost, independent
R          estimates
    • Contract negotiations
B
    • Award the contract
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     12.4 SELECT SELLERS


Inputs                   Tools &       Outputs
Proposals                Techniques
Evaluation Criteria
                         Weighting     Selected
Organizational
Process Assets           System        Sellers
Risk Register            Independent   Contract
Risk-Related             Estimates
                                       Contract
Contractual
                         Screening     Management
Agreements
                         System        Plan
Qualified sellers List
                         Contract
Procurement
Document Package         Negotiation
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        12.4.1 Inputs to Select Sellers             Continuing Education Division
                                                    Ryerson University




    •   .1   Proposals
    •   .2   Evaluation Criteria
O   •   .3   Organizational Process Assets

R   •   .4   Risk Register
    •   .5   Risk Related Contractual Agreement
B   •   .6   Qualified Sellers List
I   •   .7   Procurement Documentation Package
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    12.4.2 Tools & Techniques for                 Ryerson University




            Select Sellers
       • .1 Weighing system
         – Method for quantifying qualitative data
         – Minimize the effect of personal prejudice

O      • .2 Independent estimates
         – Procuring organization may prepare its own
R          estimates as a check on pricing
B      • .3 Screening system
I        – Establishing minimum performance
           requirements for evaluation criteria
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    12.4.2 Tools & Techniques for
            Select Sellers
    • .4 Contract negotiation
        • Involves clarification and mutual
          agreement on the structure and
O         requirements of the contract
        • Final contract to reflect all agreements
R         reached
B       • Examples of subjects covered:
I         responsibilities & authorities, terms and
          law, contract financing, price
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      12.4.3 Outputs from Select
                Sellers
    • .1 Select Sellers
    • .2 Contract
         • Mutual agreement which obligates the seller to
O          provide the specified product and obligates the buyer
           to pay for it.
R        • Legal relationship subject to remedy in the courts

B        • Contract =agreement=subcontract=purchase
           agreement=memorandum of understanding
I   • .3 Contract Management Plan
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            12.5 Contract Administration

                               Project Management Book of Knowledge
                                            Chapter 12
                         Project Procurement Management

O        12.1
    Plan Purchase
    and Acquisition
                         12.2
                         Plan
                      Contracting
                                         12.3
                                     Request Seller
                                      Responses
                                                          12.4
                                                         Select
                                                         Sellers
                                                                       12.5
                                                                     Contract
                                                                   Administration
                                                                                           Contract
                                                                                           Closure


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    12.5 Contract Administration
    • Ensuring that the vendor’s performance
      meets contractual requirements
    • Application of project management
O     processes to the contractual relationship
      –   Project plan execution
R     –   Performance reporting
B     –   Quality control

I     –   Change control
      –   Communication management
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           12.5 CONTRACT ADMINISTRATION

Inputs          Tools &                  Outputs
                Techniques               Organizational
Contract        Contract Change          Process Assets
                Control System           (updates)
Approved
                Buyer-Conducted
Change          Performance Reviews      Requested
Requests                                 Changes
                Inspections and Audits
Work            Performance Reporting    Recommended
Performance     Payment System
                                         Corrective
Information                              Actions
                Claims Administration
Selected        Records Management       Contract
Sellers         System                   Documentation
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              12.5.1 Inputs to                         TRAINING SERVICES
                                                       Continuing Education Division
                                                       Ryerson University



          Contract Administration
    • .1 Contract
    • .2 Performance Reports
         • Which deliverables completed, not completed
         • To what extent quality standards are being met
    • .3 Approved Change requests
O        • Modifications to the terms of the contract or to the
           description of the product or service
R        • Contested changes where the seller and project

B
           management team cannot agree on compensation for the
           change are also called claims, disputes or appeals

I   • .4 Work Performance Information
    • .5 Selected Sellers Alvares CKPM 205
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                                                CORPORATE
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     12.5.2 Tools & Techniques                  Ryerson University




    for Contract Administration
    • .1 Contract change control system
      – the process by which the contract can be
        modified
O   • .2 Buyer-Conducted Performance
R     Reports
      – Information about how effectively the seller
B       is achieving the contractual objectives
I   • .3 Inspection and Audits
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                                                 CORPORATE
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                                                 TRAINING SERVICES
                                                 Continuing Education Division


     12.5.2 Tools & Techniques                   Ryerson University




    for Contract Administration
    •   .4   Performance Reporting
    •   .5   Payments System
    •   .6   Claims Administration
O   •   .7   Records Management System
R
B
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                                                    CORPORATE
                                                    AND PROFESSIONAL
                                                    TRAINING SERVICES
                                                    Continuing Education Division
                                                    Ryerson University



    12.5.3 Outputs from Contract
           Administration
    • .1 Organizational Process Assets
      (updates)
      – Correspondence
O        • Written documentation of certain aspects of

R
           buyer/seller communications
      – Payment schedule and requests
B   • .2 Contract changes
I   • .3 Recommended Corrective Actions
    • .4 Contract Desmond Alvares CKPM 205
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                                                                                     AND PROFESSIONAL
                                                                                     TRAINING SERVICES
                                                                                     Continuing Education Division
                                                                                     Ryerson University




                      12.6 Contract Closure
                                Project Management Book of Knowledge
                                             Chapter 12
                          Project Procurement Management

O        12.1
    Plan Purchase
    and Acquisition
                          12.2
                          Plan
                       Contracting
                                          12.3
                                      Request Seller
                                       Responses
                                                           12.4
                                                          Select
                                                          Sellers
                                                                        12.5
                                                                      Contract
                                                                    Administration
                                                                                              12.6
                                                                                            Contract
                                                                                            Closure


R
B
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                                              CORPORATE
                                              AND PROFESSIONAL
                                              TRAINING SERVICES
                                              Continuing Education Division
                                              Ryerson University



      12.6 Contract Close-out
    • Product verification
      – Was all work completed correctly and
        satisfactorily
    • Administrative close-out
O     – Updating records to reflect final results
R     – Archiving of information for future use

B
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         12.6 CONTRACT CLOSE OUT

Inputs          Tools &       Outputs
                Techniques    Organizational
Contract                      Process Assets
                Procurement   (updates)
Documentation   Audits
Contract        Records
Closure         Management
Procedure       System
                                                CORPORATE
                                                AND PROFESSIONAL
                                                TRAINING SERVICES
                                                Continuing Education Division
                                                Ryerson University



       12.6.1 Inputs to Contract
               Close-out
    • .1 Contract documentation
      –   Contract
      –   Supporting schedules
O     –   Requested and approved contract changes
      –   Seller-developed technical documentation
R     –   Seller performance reports
B     –   Financial documents
      –
I
          Results of contract related inspections
    • .2 Contract Closure Procedure
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                                              CORPORATE
                                              AND PROFESSIONAL
                                              TRAINING SERVICES
                                              Continuing Education Division
                                              Ryerson University



    12.6.2 Tools & Techniques for
          Contract Close-out
    • .1 Procurement audits
      – Structured review of the procurement
O       process
      – Identification of successes and failures
R
    • .1 Records Management System
B
I
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                                                    CORPORATE
                                                    AND PROFESSIONAL
                                                    TRAINING SERVICES
                                                    Continuing Education Division
                                                    Ryerson University



     12.6.3 Outputs from Contract
              Close Out
    • .1 Organizational Process Assets
      (Updates)
      – Contract File
O        • Documentation for Archives and Future Use
R     – Formal acceptance and closure
         • Hand over of Project and acceptance by
B          authorized authority

I     – Lessons Learned Documentation
         • Process improvements recommendations
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                                                         CORPORATE
                                                         AND PROFESSIONAL
                                                         TRAINING SERVICES
                                                         Continuing Education Division
                                                         Ryerson University



    Procurement Management Plan
    • The plan describes how the procurement process, from
      solicitation to contract close out, is managed. Included in
      this plan are:
    • The type(s) of contract(s) used.
    • If independent estimates and cost proformas will be done
O     and who will do them.
    • If standard procurement documents will be used, and if so,
R     who will prepare them.

B   • Who will manage & coordinate the procurement of these
      goods, services or products.
I   • Authority of the people involved in the process and
      defined lines of communication.
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                                         CORPORATE
                                         AND PROFESSIONAL
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                                         Ryerson University

    Procurements and Contract
            Overview

     Thank You to PMI - ISLIG
        Any Questions?
O
R          Desmond P. Alvares
B             416 258 7178

I        des_alvares@bcs.org.uk

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