7014ENG Project Management Practice

7014ENG Project Management Practice Griffith School of Engineering Griffith University 7014ENG Project Management Practice Assessment 2 Case Study Kushal Shah, s5120632 18th, Trimester 2, Sept 2019 pg. 1 Kushal Shah, s5120632 7014ENG Project Management Practice Table of Content Introduction……………………………………………………………………………………3 Problem Descriptions……………………………………………………………………….......3 Research Methodology…………………………………………………………………….........3 Data Collections…………………………………………………………………………………4 Data Analysis and findings……………………………………………………………………..4 Recommendations………………………………………………………………………………4 Conclusion………………………………………………………………………………………5 References……………………………………………………………………………………….5 pg. 2 Kushal Shah, s5120632 7014ENG Project Management Practice Introduction The aim of this study to scrutinize the case study across the area Procurement management of project management. Ineffective exercise across the case study would be testified across Project Procurement management area. Furthermore, this study put recommendations on what procedures should project manager followed and what are the options for XYZ Pvt Ltd to tackle issue in efficient and effective manner. In the case study, there is three scenarios of the XYZ Pvt Ltd. Out of the three scenarios, in two they were not able to won contact and one scenario they were not able to finished work. That indicates that XYZ Pvt Ltd has been facing issues regarding project procurement management. The bidder has provided feedback where XYZ Pvt Ltd went wrong in tender and also examined XYZ’s previous work in second scenario and third scenario. The problems within the case study were discussed followed. Problem Descriptions In the first scenario, XYZ Pty Ltd has provided irrelevant information and they made assumptions that bidder will refer there work directly. The explanation on their approach to do particular task as well as demonstration of evidence to do those task (from previous experience) were also missing in their tender. In the second scenario, the project manager has directed XYZ Pty Ltd. to bought two expensive equipment ($400,000) which was not mentioned in the bid. The performance issues in the two equipment had raised due to scope change that has hampered relationship and communication between the project manager and XYZ Pty Ltd. The project scope has changed without consulting XYZ. Then project manager assumed that XYZ weren’t in the capacity to carry on further work in the project and hired new contractor to complete. The project manager hasn’t given adequate timeframe to adjust and increased capacity to sustain in change scope to XYZ. The project manager has not followed due procedures such as show cause notice, potential suspensions and contract termination process. At a one point they were two contractors in the same project. The new contractor was selected without competitive bidding process. Third scenario, XYZ Pvt Ltd wasn’t able to won contract due to the error in the one of the milestone amount. Instead of $600,000 XYZ put $60,000 but there final tender amount was $3,350,000 and it was cheapest among the other tender. While evaluating the tenders the project manager saw this error and rectified it. The final tender amount was at $3,890.000 and it was highest among the other tender. The project manager rectified the error without proper consultation and clarification with the XYZ Pvt Ltd. Research Methodology The research depends on the positivism theory as the point includes qualitative research methodology. The way of thinking will help in giving rationale behind the examination. The research approach chose for the examination is inductive as the research goes from a particular to a general methodology. This methodology is chosen as the exploration will be finished by the examination of the case study analysis utilizing non-numerical information that enlighten about of procurement management (Patton,2005). The research approach chose for the research depends on the scrutinising of the case study analysis, along these lines, it is exploratory in nature. This is on the grounds that the information relating to case study investigation will be scrutinised top to bottom so as to concentrate on different consequences (Denzin & Lincoln, 2008). In addition to that, the case study analysis methodology will thoroughly scrutinize the project procurement management area so as to get bits of knowledge. pg. 3 Kushal Shah, s5120632 7014ENG Project Management Practice Data Collections Data has been collected from three source of information. The first source of data is literature review of project management area. The second source of the data has been collected through the guest speaker Shane Duran. The last source of data collected from Dr Sherif Mostafa lecture on procurement management and PMBOK. Data analysis and findings The qualitative research methodology doesn’t include numerical data. Findings are depends on procurement literature review and the guest speaker to draw appropriate results. According to the PMBOK, the project procurement management can be defines as “the processes to purchase or acquire products, services, or results needed from outside the project team and that the management and control processes required to develop and administer agreements such as controls, purchase orders, memoranda of agreement(MOA) or internal service level agreements (SLAs).” The project procurement management includes four stage; Plan, conduct, administer and close procurement. Plan procurement processes includes project purchasing decisions, specific approach and identified prospective sellers. Conduct procurement includes processes of selecting seller and awarding contract. The contracts can be awarded through quotations, bids, offers, proposals, expression of interest, calling for tender. There are two types of tender calling; namely open/public and closed tenders. Tender process give competitive pricing as well as open and transparent procedures. Tenders are evaluated on five criteria; Value for Money, Methodology, Resources, Capacity and Previous Performance (Akintoye, Hardcastle, Beck, Chinyio, & Asenova, 2003). Administer procurement processes of managing procurement (contractual) relationships, managing contract performance and making changes and corrections as needed. That involved contract administration (Flanagan, 2010). That can defines as contract administration ensures that the seller’s performance meets contractual requirements. Close procurement processes include product/service verifications against the contact. Recommendations The recommendations for first scenario: XYZ Pvt Ltd should submit their tender with more accurate information only related to their prospective work and that should be supported by the accurate explanation and evidence. In the second scenario, there are recommendation for both parties; the project manager and XYZ Pvt Ltd. The project manager should have clearly stated project purchasing decisions in the tender. After awarding the tender, those changes lead into the scope change. Changes to the project should be reviewed, approved and documented by the both parties. There should be impact analysis of those changes on scope, time and budgets. The project manager should have communicated those scope change to the XYZ. After changing the scope, the project manager should have given more time think to XYZ to adjust and increase their capacity or XYZ wants break the contract. The project manager should have followed close procurement procedures with XYZ and scope change contact should only awarded through competitive bidding (Davila & Palmer, 2003). XYZ Pvt Ltd are obligated through contract and contract is legal documents. XYZ should have opposed the project manager direction of buying equipment unless proper procedures followed as those purchasing changes project scope. In third scenario, there are recommendation for both parties; the project manager and XYZ Pvt Ltd. The XYZ Pvt Ltd should have consulted expert as well as proof-reading before submitting the tender. The project manager should have avoid mathematical correction and seek clarification from XYZ Pvt Ltd. pg. 4 Kushal Shah, s5120632 7014ENG Project Management Practice Conclusion Thus it can be concluded that, XYZ should provide more accurate information related tender. Ineffective processes has followed such as scope has been ambiguous and plan, administer and close procurement processes haven’t followed. The project manager should have consulted before drawing into the conclusion. References Akintoye, A., Hardcastle, C., Beck, M., Chinyio, E., & Asenova, D. (2003). Achieving best value in private finance initiative project procurement. Construction management and economics, 21(5), 461470. Davila, A., Gupta, M., & Palmer, R. (2003). Moving procurement systems to the internet:: The adoption and use of e-procurement technology models. European management journal, 21(1), 11-23. Denzin, N. K., & Lincoln, Y. S. (2008). Introduction: The discipline and practice of qualitative research. Flanagan, E. U. K. (2010). Understanding the Innovation Impacts of Public Procurement. European Planning Studies, 18(1), 123-143. doi:10.1080/09654310903343567 Patton, M. Q. (2005). Qualitative research. Encyclopedia of statistics in behavioral science. PMI. (2017). A Guide to the Project Management Body of Knowledge. In (PMBOK® Guide) (pp. 459501). Newtown Square, USA PMI. pg. 5 Kushal Shah, s5120632