In today's outsourcing-driven environment, as most of the organizations are outsourcing their activities, especially software-related projects, Project Procurement Management (PPM) has become a very important aspect in project management activities. PPM can be defined as the management of processes acquiring the products and services from outside the project team to perform the work. The process of PPM involves deliberation of what, when, where and how much to acquire, etc. It also covers the issues related to potential vendors to exercise some degree of control over contracting decisions. In short, PPM involves getting work done by people from outside the project team.
Basing on the business environment regulations, the project executive should also emphasize on obtaining or holding any relevant permits and professional licenses while executing the project. However, the decisions are integrated with schedule development, activity resource estimation and make or buy decisions (it is one of the most critical supply chain strategic decisions).
Effective PPM is very important to achieve the desired goals and helps to make strategic decisions which impact the project's bottom line. The project executive, who is involved in PPM, must adopt best practices in procuring external services and products right from the initial decision of purchase to final contract closeout. According to James R Chapman, PM Expert, successful execution of PPM involves six-key processes. |
