How to remember ITTOs of Project Procurement Management?

This is the ninth article in the series “How to remember ITTOs”. You can find all the articles in this series here: How to remember ITTOs series.

ITTO stands for Inputs, Tools and Techniques, and Outputs.

In this article, we will focus on the inputs and outputs of the three processes involved in Project procurement management.

Parties involved in Project Procurement Management

Typically, two parties are involved in procurement, the buyer and the seller. Consider yourself as the buyer, unless the PMP exam question specifically states otherwise.

The seller provides the product, service or result which will be a component in your overall project.

Seller is a common word used by PMBOK Guide. In your industry, you may have other names for seller, like vendor, supplier, service provider, contractor, sub-contractor, etc.

What is Project Procurement Management?

Project procurement management is the knowledge area in which the team acquires the products, services or results needed from outside the project team. The work involved in this knowledge area includes, but not limited to:

• Decides whether to make or buy a product, service or result (whether to do it yourself or outsource it).
• Extracts the portion of the scope from scope baseline to create procurement statement of work.
• Decides the type of contract suitable for the identified portion of work.
• Develops a set of selection criteria to objectively select the seller.
• Prepares an independent cost estimate, so that you can compare the bids of the sellers.
• Prepares the bid documents (Request for Information, Request for Quotation or Request for Proposal).
• Conducts bidder conference to clarify the doubts of the prospective bidders. Bidder conferences are also known as pre-bid meetings, pre-bid conferences, vendor conferences or contractor conferences.
• Evaluates seller proposals using established source selection criteria, and shortlists the sellers who can satisfy the project requirements.
• Negotiates with the shortlisted sellers.
• Enters into a mutually-binding agreement with the selected sellers.
• Monitors the performance of the seller.
• Ensures payments to the seller is linked to the seller’s progress as defined in the contract.
• Settles all claims and disputes through negotiation; if cannot  be resolved through negotiation, alternative dispute resolution (ADR) approaches has to be followed.
• Closes the procurement

Process Flow for Project Procurement Management

In my earlier eight articles on the process flow series, I have suggested process flow diagrams as a way to easily remember and chart the concepts. I am using the same approach for Project Procurement Management below.

To avoid complexity, I have considered ONLY the major inputs and outputs of the processes. Please note that, the process flow diagram does NOT include ALL inputs and outputs. Please refer to PMBOK Guide for a complete list of ITTOs.

The best way to learn and remember the ITTOs is to draw the process flow diagram yourself. Once you try to draw the diagram two or three times, you will understand the major work that happens in the processes and how the various inputs and outputs interact.

Tips to remember ITTOs in Project Procurement Management

• The following inputs are common to all the processes in Project procurement management:
  • Enterprise Environmental Factors (EEF),
  • Organizational Process Assets (OPA) – Please note that OPA is an input to 47 processes; only two processes do not take OPA as an input. They are 5.5 Validate Scope and 11.7 Monitor Risks
  • Requirements documentation,
  • Risk register
  • Stakeholder register
• Once procurement management plan is developed in 12.1 Plan Procurement Management, it becomes an input to the remaining two processes in Project procurement management. This is a concept you need to understand and it applies to all the other knowledge areas too. The management plan, which is typically an output of the first process, becomes an input to all the other remaining processes in that knowledge area. I suggest you to look at the process flow diagram of other knowledge areas to understand this.
• Work performance data is an input to Control Procurements process; and work performance information is the relevant output from this process.
• Change requests is an output of all the three processes of Project Procurement Management. (Note: For all Monitoring & Controlling processes, change requests is an output; the only exception is Perform Integrated Change Control. In this process, change requests is an input and Approved change requests is an output).
• Expert judgment is a tool/ technique used in all the three processes of Project Procurement Management.

Conclusion

How do you remember ITTOs for PMP exam? Have you tried to draw the process flow diagram yourself? Do you find this approach useful?

Please leave your comments and suggestions.