BSBPMG537 Manage project procurement

Subject Code :
BSBPMG537
University :
The University of Melbourne Exam Question Bank is not sponsored or endorsed by this college or university.
Country :
Australia

Assessment Manual

BSBPMG537 Manage project procurement

Candidate Name
Student ID No.
Assessor name
Assessment Date/s	Click or tap to enter a date.	Click or tap to enter a date.	Click or tap to enter a date.

Objective of assessments

We are committed to your learning by providing a training and assessment framework that ensures the knowledge gained through training is translated into practice in your work in the workplace with consistent and competent work performance. The purpose of the assessment process is to assess your ability:

to apply skills and knowledge using written and demonstration activities that apply to tasks and activities of a workplace.

to translate your learning into your work performance in a workplace through demonstration.

to apply skills and knowledge actively, correctly, and consistently for work in a workplace.

Assessment process

The assessment process is known as competency-based assessment. This means that evidence of your current skills and knowledge will be measured against national standards, not against the learning you have undertaken either recently or in the past. Some of the assessment will be concerned with how you apply your skills and knowledge in a workplace, and some in the training room as required by each unit. The assessment tasks have been designed to enable you to demonstrate skills and knowledge application and produce the critical evidence to successfully demonstrate competency at the required standard.

Your assessor will ensure that you are ready for assessment and will explain the assessment process. Your assessment tasks will outline the evidence to be collected and how it will be collected, for example, a written activity, case study, or demonstration and observation. The assessor will also have determined if you have any special needs to be considered during assessment. Changes can be made to the way assessment is undertaken to account for special needs and this is called making Reasonable Adjustment provided to you in the assessment guide separately.

Assessment Task	Assessment Method	Evidence Gathering Techniques (Document and observation used to assess you)	Where? (Assessment location)	When? (Due date)
Assessment Task 1	Written Task (Questioning)	? Written answers of consistent application of knowledge	Training Room	Refer to timetable
Assessment Task 2	Case study	? Written Solutions ? Observation of your consistent application of skills and knowledge in performance and demonstration	Training Room (Simulated workplace environment)	Refer to timetable
Assessment Task 3	Project	? Written Solutions ? Observation of your consistent application of skills and knowledge in performance and demonstration	Training Room (Simulated workplace environment)	Refer to timetable

Assessment guide

Your assessment guide that is provided to you will explain the following. Please refer to assessment guide for the following information before commencing your written work and demonstration:

Your responsibilities during the assessment.
Assessor responsibilities during the conduct of assessment.
Your rights to appeal if the assessment outcome appears as Not Yet Competent for one or more assessment tasks.
The process to apply if you already possess the knowledge and skills to be able to demonstrate competence in this unit.
The formats and structure of the written assessment work for submission.
The length, breath and the quantity of your written work, plagiarism, collusion, cheating and how to use references for sources of information.
How to achieve a satisfactory outcome against the criteria for each type of assessment task.
Application of reasonable adjustments where necessary.
Requirements for demonstration, performance for practical assessment tasks and activities.
Your assessment performance with commitment, consistency, clarity, capacity, capability, correctness, and completeness.

Instructions

Each assessment task provides you with assessment information that includes answers to what, why, how, when, in what condition, what materials, resources and equipment to use and evidence requirements.
Read the applicable information and if unsure seek clarification from your assessor.
Before and during assessment demonstration and interacting with others, ensure you follow simulated workplace policies and procedures.
Ensure you follow hygiene procedures, social distancing rules and ethics before, during and after assessment tasks and activities.
Undertake your preparation activities and demonstration activities as specified and directed by your assessor.
In any situation during the assessment, if you find that you are unable to perform due to any condition (health or safety), stop your work and inform the assessor of the condition.
Ensure you are obligated with your rights as a candidate and respects the rights of your assessor during the assessment performance.
For interactive and role-play activities, organise role-play settings and individuals for role-play in collaboration with assessor and training mates.
Submit your written work when it becomes due and avoid the requirements of extensions.
Use provided self-assessment checklists by checking as you progress in assessment to ensure you do not miss anything that may lead to unsatisfactory outcomes.

Submission specifications

Fill your submission details in the front page and attach any additional documents and any other evidence as specified and required by your assessor.
Follow the institution submission requirements of assessment. I.e., electronic submission (LMS) or hard copy submission or as specified by your assessor for differing assessment situations.

ASSESSMENT GUIDELINES FOR WRITTEN TASK

QUESTION TYPE	HOW LONG YOUR ANSWER MUST BE (LENGTH OF ANSWER)
Define	Length approximately 4 typed lines = 50 words, or 5 lines of handwritten text for each question.
Identify	Write dot points of the number of items to identify according to the question.
Outline	Summarise in a line or set of lines the required number of items or develop appropriate meaningful answers according to the question but not in detail.
Identify and briefly describe	Identify in dot points and provide a description of each with a minimum of 4 typed lines = 50 words, or 5 lines of handwritten text for each question.
Describe	Provide a description with minimum 8 typed lines = 100 150 words, or 10 15 lines of handwritten text or appropriately described to provide a meaningful answer with consistent knowledge application in length according to the question.
Explain	Explain the procedure with minimum 8 typed lines = 100 150 words, or 10 15 lines of handwritten text or appropriately explain to provide a meaningful answer with consistent knowledge application in length according to the question.
Distinguish / differentiate	Distinguish means recognise or treat (someone or something) as different. Todifferentiateis to show or find thedifferencebetween things which are compared. It simply means that they are not thesame but does not qualify them as being unique and possibly not related. Length approximately 4 8 typed lines = 50 100 words, or 5 - 10 lines of handwritten text for each question.
What?	This is to assess your knowledge of something related to the subject area asking you to specify one or more things related to what is being asked in the question. This is generally asking for a short answer for which you need to provide a short description answering the question where the reader understands the answer to the question.
How?	This method of question is to assess your ability to explain or describe the ways, methods, manner, procedure, or process of something related to the question being asked. You need to provide sufficient description of how (ways, methods, manner, procedure, or process) it can be performed for the reader to understand the ways or procedure.
Why?	This question is to assess your knowledge of something and the purpose of it. You need to provide sufficient description of why (the purpose/objective or aims) it is used for the reader to understand why.

ASSESSMENT TASK 1

Written Questioning

You are required to read the following assessment information, requirements, and instructions before commencing. This task is about written questioning for you to provide written answers as evidence of your knowledge application. Ensure you follow the terms and conditions applied in undertaking written task during the assessment as specified and facilitated by your assessor.

Assessment Information		Description
1	Assessment method	Written questioning
2	Assessment type	Summative
3	Assessment description (What?)	This assessment task is a written task for which you are required to provide written answer solutions to the questions demonstrating your knowledge required to undertake procurement in projects. Read the following information related to your assessment to prepare and perform to provide evidence of your knowledge.
4	Purpose (objective) of the assessment (Why?)	To gather evidence of your ability to apply knowledge consistently to undertake procurement in projects.
5	Assessment Instructions (How?)	1. Read the theoretical component of the learner workbook. 2. Conduct research and review literature relevant to the unit. 3. Provide answer solutions to each question using your own words. Note: do not just copy past the answers from other materials. 4. You may refer to learning materials and other sources of information as agreed by your assessor. 5. You may word-process your answers using MS Word /Mac document. 6. The assessment is due for completion on the date/s and time/s. specified by your assessor. 7. Any variations to this arrangement must be approved in writing by your assessor. 8. Submit your work with any required evidence attached. 9. See the specifications below for details of submission requirements. 10. Read the following requirements for this assessment completion:
6	Assessment date/s and timing/s (When?)	This assessment will be conducted according to the training delivery session plan. Assessor will specify the timings of assessment and submission of evidence. Time allowed for the assessment is 3 hours within 20 hours of training delivery of week 2.
7	Specifications (What structure, format, and demonstration)	1. Write answer solutions to all the questions using word-processed documents. 2. Provide specified length and numbers mentioned in each question. 3. Submit the answers with a cover page that includes your name, student ID, unit name/code, date of submission and assessor name. 4. If a separate word-process document is used for your responses, include header (unit name/code) and footer (page no. student name and ID).
8	Assessment context (Where and in what condition)	Assessment is conducted in the training room and safe environment where you are required to provide answer solutions to the questions in a word-processed document with evidence that demonstrates consistent knowledge application.
9	Required resources (What resources, equipment, tools, and materials)	1. Assessment task with instruction and assessment information 2. Learner workbook and other training handouts if or as allowed by your assessor. 3. Computer with Internet access. 4. Word-process software (MS Word/Mac). 5. Workspace, table, chair, and stationery.
10	Evidence requirements/ (What assessor is looking for)	To complete the unit requirements safely and effectively, you must prove application of knowledge consistently relevant to vocational contexts and: Provide answers to all the questions Answers must be with appropriate and sufficient length by following assessment guidelines for written tasks above. Answers must be relevant to the question and its sub parts. Your assessor may verbally assess to confirm your knowledge application in case your answer is not correct or not clear to one or more questions.

Your Task Write answers (Knowledge Application)

The following is a set of knowledge-based questions. Read the text section introduction in the learner workbook, refer to training undertaken and provide your answer solutions to the following questions using your own words to demonstrate your consistent knowledge application.

Questions

Note: Ensure you answer all the following questions using the length guidelines above and quantity requirements applicable for the following relevant questions.

What is project procurement?
Describe the following:

project objectives
project needs
project budget.

3. What is a procurement management plan? Identify the structure of procurement management plan.

4. What criteria are used for vendor selection?

5. What are legal obligations when you undertake procurements?

6. Describe project procurement in a project and industry context that relate to:

probity and,
project governance constraints.

7. What are supplier selection processes and selection criteria?

8. Briefly describe project life cycle stages.

9' Briefly describe what process you apply for conflict resolution in the workplace

Describe conflict management styles.

---End of Written Task Activities---

Assessment Task 2 Case Study

Determine and conduct procurement activities

You are required to read the following assessment information, requirements, and instructions before commencing. This task has simulated workplace reference. Ensure you access the simulated workplace resources (planning documents, policies, and procedures etc.), equipment, applicable legislation, regulation, standards, and code of conduct during the assessment as specified and facilitated by your assessor.

Assessment Information		Description
1	Assessment Method	Case study (simulated workplace)
2	Assessment Type	Summative
3	Assessment Description (What?)	This assessment task is a case study for you to consult with stakeholders to manage resources according to undertake procurement in projects. You are required to analyse the case scenario and provide written solutions to task activities by demonstrating applicable foundation skills and knowledge. You must also provide performance solutions to specific role-play activities relevant to case study in role-plays as agreed by your assessor. You must read the following information related to your assessment to prepare and perform in order to provide evidence of your skills and knowledge related to the unit of competency.
4	Purpose (objective) of the Assessment (Why?)	To gather evidence of your ability to apply skills and knowledge consistently to manage resources according to undertake procurement in projects.
5	Assessment Instructions (How?)	1. Review the skills application section/s of the learner workbook. 2. Read the task performance requirements and foundation skills application for each task activity. 3. Conduct research and review literature relevant to the unit. 4. Provide solutions to each written and performance activity using skills and knowledge and demonstrating your foundation skills. Note: Use word-process document for written activities to provide written evidence as specified in the task. you may use MS Word /Mac documents for your written evidence. 5. This task requires you to play roles. As specified and agreed by your assessor, role-play the relevant activities demonstrating relevant skills. 6. The assessment is due on the date specified by your assessor. 7. Any variations to this arrangement must be approved in writing by your assessor. 8. Submit your work with any required evidence attached. 9. See the specifications below for details of submission requirements. 10. Continue to read the following assessment requirements:
6	Assessment Date/s and Timing/s (When?)	1. This assessment will be conducted according to the training delivery session plan. 2. Assessor will specify the timings for assessment and evidence submission date/s and timing/s. 3. Time allowed for the assessment completion is 4 hours within 20 hours of training delivery of the week 4.
7	Specifications (What structure, format, and demonstration)	1. Provide written solutions to all the case study activities and questions using word-processed documents. You may use this MS Word /Mac document for your answering. Provide specified length and numbers mentioned in each written activity. 2. For role-play activities, play the role as specified by your assessor demonstrating foundation skills and knowledge application while being observed by your assessor. 3. Submit the written activities with a cover page that includes your name, student ID, unit name unit code, date of submission and assessor name. Include header (unit name/code) and footer (page number, student name and student ID number)
8	Assessment Context (Where and in what condition)	Assessment is conducted in the training room simulated and safe environment where you must perform consistently applying skills and knowledge. You must also provide written solutions to the activities in a word-processed document with evidence that demonstrates consistent skills and knowledge application in various conditions specified in the assessment task. Assessed in a simulated off-the-job situation that reflects the real workplace.
9	Required Resources (What resources, equipment, tools, and materials)	1. Assessment task with instruction and assessment information 2. Learner workbook and other training handouts. 3. Access to simulated workplace business equipment and resources. 4. Access to simulated workplace policies and procedures. 5. Computer with Internet access word-process software (MS Word/Mac). 6. Workspace, table/s, chair/s, and stationery as required. 7. Case study and/or real workplace scenario 8. Access to relevant legislation, regulations, standards, and code of practice 9. Specified timing for assessment
10	Evidence Requirements (What assessor is looking for)	To complete the unit requirements safely and effectively, you must demonstrate consistent performance and provide evidence of your ability to provide leadership for a program of work. In the course of above, you must: Provide written solutions to all the case study activities reflecting vocational application, Demonstrate performance and role-play activities consistently applying foundation skills and, Demonstrate consultation and communication effectively with relevant stakeholders (assessor and fellow trainees in role-plays).

Case Study (Skills and Knowledge Application)

Using the simulated workplace and the scenario in the appendix or your own workplace referring to the scenario in the appendix as agreed by your assessor, provide solutions to undertake procurement in projects.

Whatever the workplace you select, the policies and procedure manual of simulated workplace must be used as the policies and procedures of the workplace to undertake the following task. In case you select your own workplace or any other workplace you have access to information, provide a brief description of the workplace such as the industry, operation, personnel, and teams.

Your role (Occasion 1)

You work as the purchasing manager for Australian Construction (Simulated workplace) with responsibility to undertake procurement in projects managing and leading a project in an organisation.

Your Task

Complete the following workplace activities demonstrating skills and knowledge to undertake procurement in projects:

A: Determine procurement requirements and processes

Access Australian Constructions (Simulated workplace) documents including policies and procedures and use the documents and relevant policies and procedures to undertake this task. Then, undertaking following activities for the simulated workplace.
Read the case study in appendix and identify the following using the template provided in appendix 2:

project objectives
project needs
project budget
procurement requirements.

3. Develop a procurement management plan using the template provided in appendix 2.

4. Conduct research using the computer and Internet and identify at least three potential suppliers who have the capability of products and services to procure above procurement requirements.

5. Determine and outline the selection processes and selection criteria to select the most viable supplier.

6. Write an email script to above suppliers to obtain information for fulfilling procurement requirements and mention selection criteria.

Role-play activity. Refer to next page for details. Meet with the project manager (your assessor) in a role-play meeting to discuss and obtain approvals for procurement processes to be used.

B: Conduct procurement activities

Write an email script to communicate with selected suppliers about agreed proposals and specifications and show it to your assessor and confirm their understanding.
Write a script to seek supplier responses and show it to your assessor and ask for his responses.
Using the responses from your suppliers (assessor) select a supplier from the three preferred suppliers you have identified as capable suppliers.
Write and email to your selected supplier using the email template provided in appendix 2 to negotiate with supplier and agree on terms and conditions of supply.

C: Monitor procurement

Implement the procurement management plan developed in above activity 3 and schedule at least three regular meeting during the procurement process.
Record procurement activities according to procurement policy procurement recording procedure.
Develop at least three monitoring activities to monitor completion of task against agreed terms and conditions
Review progress of the procurement management plan and identify variations and establish how to manage agreed variations.
Identify procurement management challenges during procurement process and write and email script to report it and implement agreed remedial actions using template provided in appendix 2.

D: Manage procurement finalisation procedures

Identify project deliverables and confirm finalisation activities meet contracted requirements.
Using procurement records and information, review project outcomes and determine effectiveness of procurement processes and procedures.
Write an email script using the email template provided in appendix 2 to seek feedback from relevant stakeholders on management of project procurement and determine and list your responses to feedback.

List at least two lessons learnt. Provide your recommended improvements for future projects.

B: Role-play - Contribute to development of strategic workforce plan

Instructions

This part is a role-play where you must organise role-play settings as agreed and facilitated by your assessor for a consultation meeting including training room place, tables, chairs, a computer with Internet, papers, pens, and any other resources as required.

Details of the task being observed	You undertake the active part of the task participating and using oral communication skills in a consultation meeting with relevant managers.
Assumptions to be made	Your assessor plays the role of project manager. You play the role of purchasing manager.
Persons involved	You (Candidate) and the assessor.

Timing for the role-play:	7 10 minutes per candidate plus your assessor will decide any additional time required based on your participation behaviour and ability to perform
Conditions under which the observation is conducted	Skills in this assessment are demonstrated by the candidate and observed by assessor in a simulated environment where the conditions are typical of those in a working environment in this industry. This includes access to: 1. Workplace or simulated workplace policies and procedures 2. relevant legislation, regulations, standards, and codes 3. workplace documentation and resources relevant to required performance evidence.

Activities to perform in the role-play (required observable behaviour

Meet with the project manager (your assessor) in a role-play meeting to discuss and obtain approvals for procurement processes to be used, and explain:
1. project objectives
2. project needs

3. project budget

4. procurement requirements

5. procurement management plan, and,

6. Seek approvals for procurement of building materials.

---End of Case Study Task Activities---

Self-Assessment Checklist

Note: The following checklist is for you to confirm your work completion as well as performance and demonstration of skills. Ensure you carefully check, and tick as completed and performed before submitting written evidence and while demonstrating skills during performing the task.

	Assessment Task Activity	Completed as required
A	Determine procurement requirements and processes	Yes	No
1	Access Australian Constructions (Simulated workplace) documents including policies and procedures and use the documents and relevant policies and procedures to undertake this task. Then, undertaking following activities for the simulated workplace.	?	?
2	Read the case study in appendix and identify the following using the template provided in appendix 2: a. project objectives b. project needs c. project budget d. procurement requirements.	?	?
3	Develop a procurement management plan using the template provided in appendix 2.	?	?
4	Conduct research using the computer and Internet and identify at least three potential suppliers who have the capability of products and services to procure above procurement requirements.	?	?
5	Determine and outline the selection processes and selection criteria to select the most viable supplier.	?	?
6	Write an email script to above suppliers to obtain information for fulfilling procurement requirements and mention selection criteria.	?	?
7	Role-play activity. Refer to next page for details. Meet with the project manager (your assessor) in a role-play meeting to discuss and obtain approvals for procurement processes to be used.	?	?
B	Conduct procurement activities
8	Write an email script to communicate with selected suppliers about agreed proposals and specifications and show it to your assessor and confirm their understanding.	?	?
9	Write a script to seek supplier responses and show it to your assessor and ask for his responses.	?	?
10	Using the responses from your suppliers (assessor) select a supplier from the three preferred suppliers you have identified as capable suppliers.	?	?
11	Write and email to your selected supplier using the email template provided in appendix 2 to negotiate with supplier and agree on terms and conditions of supply.	?	?
C	Monitor procurement
12	Implement the procurement management plan developed in above activity 3 and schedule at least three regular meeting during the procurement process.	?	?
13	Record procurement activities according to procurement policy procurement recording procedure.	?	?
14	Develop at least three monitoring activities to monitor completion of task against agreed terms and conditions.	?	?
15	Review progress of the procurement management plan and identify variations and establish how to manage agreed variations.	?	?
16	Identify procurement management challenges during procurement process and write and email script to report it and implement agreed remedial actions using template provided in appendix 2.	?	?
D	Manage procurement finalisation procedures
17	Identify project deliverables and confirm finalisation activities meet contracted requirements.	?	?
18	Using procurement records and information, review project outcomes and determine effectiveness of procurement processes and procedures.	?	?
19	Write an email script using the email template provided in appendix 2 to seek feedback from relevant stakeholders on management of project procurement and determine and list your responses to feedback.	?	?
20	List at least two lessons learnt. Provide your recommended improvements for future projects.	?	?

Assessment Task 3 Project

Undertake and manage procurement project

Assessment Information		Description
1	Assessment Method	Project work
2	Assessment Type	Summative
3	Assessment Description (What?)	This assessment task is a project based on a case study to undertake procurement in projects. You are required to undertake the project by applying foundation skills and providing solutions to task activities demonstrating the application of skills and knowledge. You must also provide written solutions to task activities. You must read the following information related to your assessment to prepare and perform to provide evidence of your skills and knowledge related to the unit of competency.
4	Purpose (objective) of the Assessment (Why?)	To gather evidence of your ability to apply skills and knowledge consistently to undertake procurement in projects.
5	Assessment Instructions (How?)	1. Review the skills application section/s of the learner workbook. 2. Read the task performance requirements and foundation skills application for each task activity. 3. Conduct research and review literature relevant to the unit 4. Provide solutions to each written and performance activity using skills and knowledge and demonstrating your foundation skills. Note: Use word-process document for written activities to provide written evidence as specified in the task. you may use MS Word /Mac document for your written evidence. 5. This task requires you to play roles. As specified and agreed by your assessor, role-play the relevant activities demonstrating relevant skills. 6. The assessment is due on the date specified by your assessor. 7. Any variations to this arrangement must be approved in writing by your assessor. 8. Submit your work with any required evidence attached. 9. See the specifications below for details of submission requirements. 10. Continue to read the following assessment requirements:
6	Assessment Date/s and Timing/s (When?)	1. This assessment will be conducted according to training delivery session plan. 2. Assessor will specify the timings for assessment and evidence submission date/s and timing/s. 3. Time allowed for the assessment completion is 4 hours within 20 hours of training delivery of the week 4.
7	Specifications (What structure, format, and demonstration)	1. Provide written solutions to all the project activities using word-processed documents. You may use this MS Word /Mac document for your answering. Provide specified length and numbers mentioned in each written activity. 2. For role-play activities, play the role as specified by your assessor demonstrating foundation skills and knowledge application while being observed by your assessor. 3. Submit the written activities with a cover page that includes your name, student ID, unit name, unit code, date of submission and assessor name. Include header (unit name/code) and footer (page number, student name and student ID number).
8	Assessment Context (Where and in what condition)	Assessment is conducted in the training room and safe environment where you must perform applying skills and knowledge. You must also provide written solutions to the activities in a word-processed document with evidence that demonstrates consistent skills and knowledge application in various conditions specified in the assessment task. (Assessed in a simulated off-the-job situation that reflects the real workplace).
9	Required Resources (What resources, equipment, tools, and materials)	1. Assessment task with instruction and assessment information 2. Learner workbook and other training handouts. 3. Access to simulated workplace and resources. 4. Computer with Internet access word-process software (MS Word/Mac). 5. Workspace, table, chair, and stationery as required. 6. Case study and/or real workplace scenario 7. Access to relevant legislation, regulations, standards, and code of practice 8. Business equipment and resources. 9. Specified timing for assessment.
10	Evidence Requirements (What assessor is looking for)	To complete the unit requirements safely and effectively, you must demonstrate consistence performance and provide evidence of your ability to provide leadership for a program of work. In the course of above, you must: Provide written solutions to all the case study activities reflecting vocational application, Demonstrate performance and role-play activities consistently applying foundation skills and, Demonstrate consultation and communication effectively with relevant stakeholders (assessor and fellow trainees in role-plays).

Project (Skills and Knowledge Application)

This project assessment is an alternative to assess that allows you to engage with your learning in more concrete ways. This task is more than application of theory and a hands-on task for you to apply what you have learned in a real workplace or simulated workplace environment.

Situation (Occasion 2)

Bridge construction plan

Current construction program of Australian Construction

Australian Construction won a project of building and construction of a bridge over a canal in Pakenham in hand. This bridge is connecting a rural road and the connecting length is about 50 meters. Local government (Council) has granted this project through bidding process. The client contact is Mr. Greg Morrison, and he is overseeing and communicating with project manager about the progress and regularly monitoring the project.

The task requirements are to commence the project in May 2022 and complete by end of July 2022. Council wants to see the progress through stages and monitor it weekly basis. Ground cleaning and excavation to be completed within two weeks time (I.e., from 1 May to 15 May 2022). Then vertical structures to be erected by 5^th of June 2022. Horizontal structure layering by 20^th of June 2022. Side railing to be done by 7^th of July 2022. Carpeting and line marking to be done by 30^th of July 2022.

For this project the following resources are required:

10 Masons, 4 Plumbers, 6 Scaffolders, 4 Steelmen, 8 road workers, and 5 assistants working under four supervisors. Two civil engineers (Harvey and Ricky) will be assigned to design and structure the bridge according to Council specifications. Project manager Steve will be assigned with the project management.

Concrete structure cost estimation

Estimated that 60 concrete structures are required to build this bridge. The accountant has estimated that in-house manufacturing these concrete structures will cost you as follows:

Expense category	Cost		Qty		Total $
Direct materials	$18,000	x	60	=	1,080,000
Direct labour	$4,000	x	60	=	240,000
Supervisory salary	$2,000	x	60	=	120,000
Variable overhead	$1,000	x	60	=	60,000

Total Expense	$25,000	x	60	=	1,500,000

Manager has researched and identified a seller (Australian Concrete Pty Ltd) who sells this concrete structured to the specifications required for $28,500 per concrete structure. But this supplier has allowed opportunity to negotiate the price with the indication that they may offer 5% to 7% discount.

Total bid for the project is $4,000,000. Total cost estimate for the project is $2,980,000. Australian Construction sub-contractor DCD Melbourne Construction has quoted to Australian Construction $3.150,000 for undertaking the project sub-contract.

Your role

You work as the purchasing manager for Australian Construction (Simulated workplace) with responsibility to undertake procurement in projects managing and leading a project in an organisation.

Your Task

Complete the following workplace activities demonstrating skills and knowledge to undertake procurement in projects:

A: Determine procurement requirements and processes

Access Australian Constructions (Simulated workplace) documents including policies and procedures and use the documents and relevant policies and procedures to undertake this task. Then, undertaking following activities for the simulated workplace.

Read the above workplace situation and establish the following:
1. project objectives
2. project needs

3. project budget

4. procurement requirements.
Develop a procurement management plan using the template provided in appendix 2.
Conduct research using the computer and Internet and identify at least three potential suppliers who have the capability of products and services to procure above procurement requirements.
Determine and outline the selection processes and selection criteria to select the most viable supplier.
Write an email script to above suppliers to obtain information for fulfilling procurement requirements and mention selection criteria.

Role-play activity. Refer to next page for details. Meet with the project manager (your assessor) in a role-play meeting to discuss and obtain approvals for procurement processes to be used.

B: Conduct procurement activities

Write an email script to communicate with selected suppliers about agreed proposals and specifications and show it to your assessor and confirm their understanding.
Write a script to seek supplier responses and show it to your assessor and ask for his responses.
Using the responses from your suppliers (assessor) select a supplier from the three preferred suppliers you have identified as capable suppliers.

Write and email to your selected supplier using the email template provided in appendix 2 to negotiate with supplier and agree on terms and conditions of supply.

C: Monitor procurement

Implement the procurement management plan developed in above activity 3 and schedule at least three regular meeting during the procurement process.

Record procurement activities according to procurement policy procurement recording procedure.

13. Develop at least three monitoring activities to monitor completion of task against agreed terms and conditions.

14. Review progress of the procurement management plan and identify variations and establish how to manage agreed variations.

15/ Identify procurement management challenges during procurement process and write and email script to report it and implement agreed remedial actions using template provided in appendix 2.

D: Manage procurement finalisation procedures

Identify project deliverables and confirm finalisation activities meet contracted requirements
Using procurement records and information, review project outcomes and determine effectiveness of procurement processes and procedures.
Write an email script using the email template provided in appendix 2 to seek feedback from relevant stakeholders on management of project procurement and determine and list your responses to feedback.

List at least two lessons learnt. Provide your recommended improvements for future projects.

B: Role-play - Contribute to development of strategic workforce plan

Instructions

Details of the task being observed	You undertake the active part of the task participating and using oral communication skills in a consultation meeting with relevant managers.
Assumptions to be made	Your assessor plays the role of project manager. You play the role of purchasing manager.
Persons involved	You (Candidate) and the assessor.

Timing for the role-play:	7 10 minutes per candidate plus your assessor will decide any additional time required based on your participation behaviour and ability to perform
Conditions under which the observation is conducted	Skills in this assessment are demonstrated by the candidate and observed by assessor in a simulated environment where the conditions are typical of those in a working environment in this industry. This includes access to: Workplace or simulated workplace policies and procedures relevant legislation, regulations, standards, and codes workplace documentation and resources relevant to required performance evidence.

Activities to perform in the role-play (required observable behaviour)

Meet with the project manager (your assessor) in a role-play meeting to discuss and obtain approvals for procurement processes to be used, and explain:
1. project objectives
2. project needs

3. project budget

4. procurement requirements

5. procurement management plan, and,

6. Seek approvals for procurement of building materials.

---End of Project Work---

Self-Assessment Checklist

	Assessment Task Activity	Completed as required
A	Determine procurement requirements and processes	Yes	No
1	Access Australian Constructions (Simulated workplace) documents including policies and procedures and use the documents and relevant policies and procedures to undertake this task. Then, undertaking following activities for the simulated workplace.	?	?
2	Read the case study in appendix and identify the following using the template provided in appendix 2: a. project objectives b. project needs c. project budget d. procurement requirements.	?	?
3	Develop a procurement management plan using the template provided in appendix 2.	?	?
4	Conduct research using the computer and Internet and identify at least three potential suppliers who have the capability of products and services to procure above procurement requirements.	?	?
5	Determine and outline the selection processes and selection criteria to select the most viable supplier.	?	?
6	Write an email script to above suppliers to obtain information for fulfilling procurement requirements and mention selection criteria.	?	?
7	Role-play activity. Refer to next page for details. Meet with the project manager (your assessor) in a role-play meeting to discuss and obtain approvals for procurement processes to be used.	?	?
B	Conduct procurement activities
8	Write an email script to communicate with selected suppliers about agreed proposals and specifications and show it to your assessor and confirm their understanding.	?	?
9	Write a script to seek supplier responses and show it to your assessor and ask for his responses.	?	?
10	Using the responses from your suppliers (assessor) select a supplier from the three preferred suppliers you have identified as capable suppliers.	?	?
11	Write and email to your selected supplier using the email template provided in appendix 2 to negotiate with supplier and agree on terms and conditions of supply.	?	?
C	Monitor procurement
12	Implement the procurement management plan developed in above activity 3 and schedule at least three regular meeting during the procurement process.	?	?
13	Record procurement activities according to procurement policy procurement recording procedure.	?	?
14	Develop at least three monitoring activities to monitor completion of task against agreed terms and conditions.	?	?
15	Review progress of the procurement management plan and identify variations and establish how to manage agreed variations.	?	?
16	Identify procurement management challenges during procurement process and write and email script to report it and implement agreed remedial actions using template provided in appendix 2.	?	?
D	Manage procurement finalisation procedures
17	Identify project deliverables and confirm finalisation activities meet contracted requirements.	?	?
18	Using procurement records and information, review project outcomes and determine effectiveness of procurement processes and procedures.	?	?
19	Write an email script using the email template provided in appendix 2 to seek feedback from relevant stakeholders on management of project procurement and determine and list your responses to feedback.	?	?
20	List at least two lessons learnt. Provide your recommended improvements for future projects.	?	?

Appendix 1

Case Study (Simulated Workplace)

Australian Constructions

Australian Constructions provide services to clients who wish to renovate, extend, or build their new dream home. Australian Constructions manage the projects from planning, designing, permits and approvals right through to lock up. Their strong attention to detail and use of the highest quality materials ensures clients are extremely satisfied with the final product. The residential team's attention to detail and willingness to complete the job on time and on budget has seen many happy customers and referrals.

A project is defined by Australian Constructions as a collection of related tasks that, when completed in the proper sequence, result in the project's completion. Transient in nature, projects typically result in the creation of a tangible product or outcome.

A construction project, sometimes abbreviated as 'project,' is the systematic process of constructing, renovating, refurbishing, or otherwise modifying a structure, building, or infrastructure. Typically, the project process begins with the definition of an overarching requirement, followed by the development of a brief, feasibility studies, option studies, design, financing, and construction.

Construction projects are frequently one-offs. That is, a project team, brief, and funding are gathered in order to develop an original design for a single project. Once the project is complete, the team disbands and may not collaborate again. This makes developing ideas and relationships more difficult, and as a result, lessons learned are frequently not carried over to the next project. This rule is subject to exceptions for repeat developers such as supermarket chains and homebuilders.

Typically, a construction project is comprised of numerous smaller projects that require collaboration across multiple disciplines. A typical construction project involves a large number of people, with the project team's structure and composition typically changing throughout the duration of the project. A project manager (or lead consultant) may be responsible for coordinating the work of other professionals such as an architect, engineer, or cost consultant. Please see the Project team for additional information.

Australian Construction project managers are undertaking scope of work, alternatively referred to as the statement of work, acts as a playbook for each project. The scope of the work establishes a narrative. It details the tasks that must be completed on a project, the order in which they should be completed, and who on the team is responsible for completing each task. A formal scope of work should be succinct and easily understood by a construction manager or employee. Each individual involved in a construction project should be trained on how to write the project's scope of work.

Senior management structure

Position	Person
CEO	James William
CFO/Accountant	Roberts Gillard
General Manager	John Smith
Operations Manager	Sam Hunter
Purchasing Manager	Thomas
Marketing Manager	Alexis Bowen
HR Manager	Harry Chris
Project Manager/s	George Brown, Steve Aby, Naval Rauf, Tony Maxwell
HR Manager	Burke Stuart
Chief Engineer	Max Wills

New house building & constructions (Occasion 1)

Project team

The construction team form part of `a larger project team which include a project board, client representatives, design team and other stakeholders such as the buildings users.

(Note: The following is a fictional team of a business unit. Positions and names are fictional to follow the privacy law and meet the unit of competency requirements).

Project Manager - Tony Maxwell (responsible for delivering the project)

Site manager - Andrew Jason (clerk of works)

Site engineer John McDonald

Team Leader Garry.

Marketing Lucy, Mary Lin.

Operation team - Tom, Dave, Tanya, Thomas and Babka.

Main contractor

Sub-contractors

The Project Manager is responsible for ensuring that day-to-day operations run smoothly. This pertains to a number of different aspects of the project such as:

Meeting deadlines and allocating the resources necessary to do so.

Budgeting for the project and billing the client for completed work.

Creating prototypes of drawings and designs.

Keeping an eye on the scope of work and any changes or additions. In turn, change orders are managed.

Collaboration with the Client and Owner's Representatives to exchange information, obtain approvals, and adhere to project specifications.

Collaborate on the development of a job site safety plan and policy.

Purchasing materials and equipment, as well as consulting services.

Oversee the control of documents.

Client - Mr. and Mrs. John Smith

John Smith currently lives in Melbourne North with his family including wife (Mrs. Smith), Daughter and son. He is the managing director of the business of Tech Dynamics which is a relationship-driven information technology services provider that partners with regional businesses that rely on technology to advance their operations. Tech Dynamics provides high-level support, robust infrastructure, and security assurance to assist them in avoiding costly downtime. It's a relationship that incorporates both remote and in-person interaction, allowing them to focus on what they do best: running a business.

Project

The purpose of this project is to construct a new residence for Mr. and Mrs. John Smith. The new residence will be a detached single-family dwelling located on a two-acre lot (lot 24) at 20 Klyde Avenue, Cranbourne, Victoria, 3098, Australia. The project is scheduled to begin on 02 March 2022 and conclude on 31 December 2022. This home will be constructed using cutting-edge building materials and codes, as well as emerging technology to reduce energy consumption. Australian Constructions, the prime contractor, will oversee and manage construction. Components of the construction effort may be subcontracted. All labour will be bonded, and all materials used will comply with or exceed applicable local building codes.

Project objectives

The home project is being undertaken to provide Mr. and Mrs. Smith with a new primary residence. The new home is scheduled to be completed in December, in time for the Smith family to relocate during the first two weeks of 2022. Mr. Smith will assume leadership of his company's Southeast operations in 2023 and will relocate from Melbourne. Mr. Smith and his family will travel and relocate in December 2015, moving directly from their current residence to the newly completed one. The home must be completed by December 31, 2022, to allow the Smiths sufficient time to establish residence in the community and enrol their children in the school system in time to begin the 2016 school year alongside their classmates.

The estimated commitment of the contractor is A$950,000.00. The new property will include the following features upon completion, as detailed in the detailed specifications and blueprint:

Landscaping

Foundation (with basement)poured concrete and concrete block

Driveway2000 feet of concrete with brick inlay

Main home4500 square feet of brick/stucco

Deck / Patio / Screen Room

Procurement requirements

Brick /Masonry.

Concrete

Mudbrick/rammed earth

Stone

Timber

Construction Management Procurement

Construction Management Procurement and requests for proposals (bidding/tendering) from architects and engineers to contractorsgeneral, specialty, specialized equipment, furnishings, and landscapersand on and on. Every viable proposal is examined in the light of the owners priorities and the contractors ability to follow through.

At Australian construction company, Thomas, the procurement manager is primarily responsible for procurement. Thomas is the logistics professional who is in charge of all material purchases for a business's projects. Additionally, Thomas ensures that goods arrive on time and on budget. There are certain practical abilities that assist him in effectively performing his duties. Several of these abilities include analytical thinking, negotiation, business communication, and strong mathematical abilities. Additionally, Thomas is responsible for the following:

Evaluation of bids and RFPS

A component of the procurement strategy is the evaluation of bids and request for proposals. In preparing the proposals, the procurement manager will provide input on building materials and associated costs.

Resources and deadlines management

The procurement schedule identifies the items that must be purchased and ensures they arrive on-site on time. Additionally, the procurement manager coordinates procurement and construction schedules to avoid project delays.

Monitoring the project

The responsibilities of the procurement manager do not end with the acquisition of materials and services for the project. Additionally, they are accountable for contract management, change orders, submittals, evaluations, and the overall performance of the project. They can occasionally use the data from the project to collaborate with and negotiate with vendors as contract terms and circumstances change.

Procurement benefits

Procurement is critical to the success of a project during both the construction and design phases. It heavily relies on the project managers' experience, market knowledge, and resources. The procurement models used in a project each have their own set of benefits and drawbacks, depending on how they are implemented. However, procurement benefits are expected to be widespread, demonstrating how critical procurement is in construction. The following are some of the benefits of procurement in the construction industry.

Timeliness

The time required to procure goods and services for a project has an effect on the scheduling of critical project activities. For example, the dates of material delivery and completion of contracted work are critical dates in the project schedule and are directly related to the procurement cycle. Improper procurement will result in project delays, or a project being placed on the critical path, thereby jeopardising the project's success.

Risk reduction

Unavoidable risks are a common cause of project failure. Project delays are one of the risks associated with a project. Proper procurement, on the other hand, mitigates this by ensuring that goods and services are delivered on time. As a result, the construction process runs smoothly and on time.

Communication

Procurement helps project stakeholders and external suppliers communicate more effectively. This is because stakeholders must meet on a regular basis and provide constructive feedback on how to improve the procurement cycle's efficiency. Proper communication fosters the development of more innovative ideas, which benefits the construction process.

Budget

When dealing with large projects, it is critical that your company has someone who is knowledgeable about current rates and when budget variances are acceptable. Proper procurement will enable the identification of excessive and unnecessary spending. Additionally, it eliminates the client's bargaining power, as the procurement team is always prepared to negotiate down any quote and ensure the client receives the best deal.

A well-written construction procurement plan details the process of managing a construction project. Procurement's advantages in a large project are self-evident. The procurement team assists the project team in determining which questions to ask, potential cost fluctuations, required skills, and scope of work. Construction procurement is all about managing projects on behalf of owners in order to construct their visions.

Project deliverables

Architectural drawings complete and approved

Building permit approved

Lot preparation and clearing complete
Foundation excavation complet
Footings poured and set

Foundation poured, block construction completes, foundation set
Home and garage exterior closed to weather
Driveway and landscape complete
Interior wiring complete
Exterior wiring complete
HVAC (heating, ventilation, and air conditioning) complete
Interior plumbing complete
Exterior plumbing complete
Interior finish completes
Exterior finish completes
Walkthrough complete
Certificate of Occupancy granted
Interior and exterior punch list approved
Interior and exterior punch list complete
Acceptance review and key turnover complete.

Project approach

Prime contractor will maintain all project documents and schedule.

Prime contractor will perform work with contractors own employees who are bonded and hold the appropriate trade licenses and credentials. In the event that the prime contractor subcontracts work, all subcontractors employees will be verified by prime contractor to be bonded and will hold the appropriate trade licenses and credentials.

Prime contractor agrees to pay a 10% single quarter penalty for any project worker found on the project site without proof of proper trade license and credentials.

Prime contractor will be responsible for all subcontract oversight, deliverables and management.

Prime contractor has agreed to the terms of the fixed-price contract and schedule.

During planned project execution, prime contractor will provide periodic progress reports to buyer (biweekly, monthly).

Following any schedule delay, prime contractor agrees to provide progress reports on a weekly basis until schedule has been caught up.

Issue management

Project-related issues will be tracked, prioritized, assigned, resolved, and communicated in accordance with the Prime Contractors Issue Management protocol.

Issues will be reported using an Issue Report Form. Issue descriptions, owners, resolution and status will be maintained in an Issues Log in a standard format.

Issues will be addressed with the project owner and communicated in the project weekly status report.

Change management

The change control procedures as documented in the prime contractors Change Management Plan will be consistent with standard home construction methodology and consist of the following processes:

The Project Manager will establish a Change Log to track all changes associated with the project effort.

All Change Orders must be submitted via a Change Order Form and will be assessed to determine possible alternatives and costs.

Change Orders will be reviewed and approved by the project owner and accepted/acknowledged by the buyer.

The effects of approved Change Order on the scope and schedule of the project will be reflected in updates to the Project Plan.

The Change Log will be updated to reflect current status of Change Orders.

Communications management

The following strategies have been established to promote effective communication within and about this project. Specific communication policies will be documented in the prime contractors Communication Plan.

The Prime Contractors Project Manager will present project status to the buyers on a biweekly basis.

The buyer will be notified by the prime contractor via e-mail or telephone of all urgent issues. Issue notification will include time constraints, and impacts, which will identify the urgency of the request.

The buyer will notify the prime contractor of schedule, scope or budget modifications in a timely manner. Communications of changes may be made by voicemail or telephone but will not be acted upon by prime contractor until a Change Order Form is received.

Procurement management

The prime contractor will maintain a Procurement Management Plan in accordance with the Project Plan. The Procurement Plan will document the following:

How much, when and by what means each of the materials and services that this project requires will be obtained

The types of subcontracts required (if any)

How independent estimates (as evaluation criteria) will be obtained

How procurement will be coordinated with project schedule and budget

What a subcontracted Statement of Work includes

Potential sources of goods and services

Resource management

The Prime Contractor will produce a Resource Management Plan that will document the following:

All materials and services to be delivered as part of the project along with cost estimates and quality information

Which materials and services will be obtained from sources outside the Prime Contractors organization?

Approvals

All funding has been preapproved and placed in a reserve account against which the primary contractor may draw. Contractor may draw quarterly payments of equal amount beginning with the second quarter following start of work. Buyer will withhold first quarterly payment until all work is completed and approved at end of project close and turnover. Pending satisfactory acceptance of project close and transition, buyer will provide final payment to contractor. Note: Invoices will be generated by contractor at the close of each construction quarter.

Invoicing will document all materials purchased during the previous quarter.

Invoicing will document all work completed during the previous quarter.

Payment will be made in four (4) equal quarterly payments.

Anticipated materials or labour cost variance above 2% in any single quarter, or 5% overall requires detailed explanation and approval of the buyer before commitment to purchase or perform work.

All cost increases invoiced without prior approval either by the previous bullet or by the buyer will be paid at the original contract price.

Project deliverables and quality objectives

All HVAC (heating, ventilation and air conditioning), landscaping, finish work, including inside and exterior doors, interior and exterior cabinetry and doors and door and cabinetry hardware, bathroom fixtures, kitchen appliances, counter tops, backsplash material, garage finish work, flooring and attic are at the contractors Level VPremium Grade per the contractors detailed house plans and upgrade options.

Buyer will select bathroom fixtures, kitchen and laundry room fixtures and appliances as specified on contractors detail schedule.

Contractor has included a $10,000.00 lighting allowance. All lighting requirements that exceed the allowance will require submittal of change request to the contractor.

Quality control activities

Contractor reserves the right to require change orders for any/all modifications to current design and Level VPremium Grade finish plans following contract approval. Additionally, contractor reserves the right to require change orders for any/all modifications to project (plan, design, schedule, scope) requested by purchaser following official schedule approval prior to commencement of work.

Source: adapted from Appendix B Project Scope Statement Example, (n.d.) Available at: https://onlinelibrary.wiley.com.

Bridge construction plan (Occasion 2)

Current construction program of Australian Construction

For this project the following resources are required:

Concrete structure cost estimation

Estimated that 60 concrete structures are required to build this bridge. The accountant has estimated that in-house manufacturing these concrete structures will cost you as follows:

Expense category	Cost		Qty		Total $
Direct materials	$18,000	x	60	=	1,080,000
Direct labour	$4,000	x	60	=	240,000
Supervisory salary	$2,000	x	60	=	120,000
Variable overhead	$1,000	x	60	=	60,000

Total Expense	$25,000	x	60	=	1,500,000

Procurement Policy

Policy statement

Procurement Policy applicable to the purchase of goods and services and specify:

Thresholds for competitive Tender.

Criteria used to evaluate whether a contract provides value for money.

Description on how a Australian Construction will seek to collaborate with Australian Constructions and public bodies.

Conditions under which a Australian Construction may purchase goods and services without a public tender or Expression of Interest (EOI).

Description of the process to be undertaken in inviting a public tender or EOI.

Why is the Policy important?

The policy enables Australian Construction and Australian Construction employees to:

Meet legislative requirements

Enables compliance with the Act.

Deliver best value outcomes

effectively procure items while delivering best value to the Australian Construction.

Ensure ethical conduct, accountability, and transparency

Procurement must be conducted ethically to the highest standard of integrity.

Manage risk management factors and ensure continuity of supply

appropriate risk management must be considered to ensure continuity of supply of goods and services to Australian Construction.

Purpose

The purpose of this Procurement Policy (Policy) is to:

Provide a procurement framework for the Australian Construction

Australian Construction (Australian Construction) to achieve value for money in the procurement of goods and services.

Assist in advancing the Australian Constructions sustainability and social objectives.

Ensure continuous improvement in the provision of services for

the community.

Ensure that Australian Construction resources are used efficiently and effectively.

Procurement Principles

Australian Construction will apply the following fundamental best practice principles to procurement, irrespective of the value and complexity of that procurement:

value for money

sustainability (social, economic, and environmental)

open and fair competition

accountability

risk management

probity and transparency

local economic benefits.

What if we dont comply?

In all cases, Australian Construction staff are responsible for complying with the Policy. Non-compliance with the Policy may result in a breach of our legislative requirements and disciplinary actions, including dismissal. In addition, criminal and civil penalties may be imposed in cases of fraud, corruption, bribery, or breach of Australian Consumer Laws.

Key Principles for all Staff

Staff must not engage in the selection of external suppliers without seeking timely input from the procurement team. Staff engaged in any procurement activities must be able to demonstrate that they have complied with this Policy.

Scope

The Policy and procurement function sets the direction of procurement governance, processes and procedures. The Policy will apply to Australian Construction, Australian Construction staff and all persons undertaking procurement on behalf of Australian Construction and the principles of the Policy must be complied with when undertaking procurement for goods and services. The scope of the Policy commences from when Australian Construction has identified a need for procurement, continues through to the delivery / completion of the awarded contract, the management of the contract and contract closing.

Annual Forward Procurement Plan

At the start of each financial year every branch is required to create a forward procurement plan for all contract purchases greater than $100,000 (ex GST). Plans are to be approved by the relevant Director and endorsed by the Director Procurement and Contract Management. A consolidated view of all Annual Forward Procurement Plans is to be presented to Australian Construction for their information.

Procurement Plan

Prior to commencing the sourcing process for all purchase amounts above $250,000 (ex GST), a Procurement Plan is to be completed. A Procurement Plan should also be completed when undertaking a prototype or proof of concept which creates a service with a sole supplier (e.g., software). The plan should include the initial procurement approach for the prototype plus an agreed term should the service be scaled plus an upper limit on value for the term. This approach is exempt from the procurement thresholds across the agreed term as approved in the plan. Delegation approval is required for the upper limit value.

The Procurement Plan is to be approved by the Director Procurement and Contract Management and the relevant Branch Director.

Procurement Methodology and Thresholds

The procurement methodology is dependent on the value threshold and/or risk of the purchase as shown below. The value threshold to determine the methodology is the total accumulated spend for the procurement including any anticipated variations for the procurement activity.

$0 < $2000 (ex GST)

Purchasing card if available or pay on invoice.

$2,000 < $50,000 (ex GST)

Obtain a minimum of two quotes

Undertake a request for quote following the process within the Procurement Management System.

Director exemption is to be sought from requesting two quotes.

$50,000 < $250,000 (ex GST)

Obtain a minimum of three quotes.

Undertake a request for quote following the process within the Procurement Management System.

Address any risk issues including OH&S.TheRiskIdentification Guide (optional) can be used to identify risks.

General Manager exemption is to be sought from requesting three quotations.

$250,000+ (ex GST)

Contact your Category Manager to initiate a Request for Tender or EOI process.

Undertake the Tender or EOI following the process within the Procurement Management System.

Address any risk issues including OH&S.TheRiskIdentification Guide (optional) can be used to identify risks.

Director Procurement and Contract Management, General Manager and CEO approval is to be sought from not undertaking an open Tender process.

Procurement and Contract Management System

Australian Construction has an online Procurement and Contract Management System (Procurement Management) which prescribes the processes and procedures for all stages of the end-to-end procurement lifecycle. It is a requirement that all procurements including variations are conducted in Procurement Management.

Procurement Management must also be used for contract management including key activities such as performance management, records management, alerts on key activities, risk and issues, Payment Card Industry Data Security Standard compliance management plus financial management.

Exemptions to the Procurement Methodology

The following authority must be used for exemptions to the procurement methodology where the exemption is justified:

Director exemption is to be sought from requesting two quotations.

General Manager exemption is to be sought from requesting three quotations.

General Manager, Director Procurement and Contract Management and CEO approval is to be sought from not undertaking an open Tender process.

This exemption process should be followed to approve a single sourcing procurement approach.

Delegations, Authority and Levels of Procurement

The relevant instrument of delegation and Australian Constructions general delegation policy determine the levels of delegated authority required for expenditure on each instance of procurement.

A Purchase Order must be raised in the finance system, for each individual procurement and all subsequent contract variations.

Measures which intentionally seek to avoid the requirement of the procurement thresholds, for example, contract splitting, purchase order splitting or placing multiple orders, seeking multiple quotations with a single supplier, or engaging in effect a single supplier under different guises, are considered to be a breach of this Policy.

All procurements above $250,000, except for major construction projects, must be approved by the Director Procurement and Contract Management prior to delegation approval.

Probity Requirements

Members of staff (and all persons engaged in procurement on Australian Constructions behalf) must exercise the highest standards of integrity in a manner able to withstand the highest level possible of scrutiny. All members of staff have an overriding responsibility to act impartially and with integrity, avoiding conflicts of interest. In procurement matters, all Australian Construction staff:

Must complete and lodge a Disclosable Interests and Confidentiality Declaration if engaged in the evaluation of quotations or tenders.

Must disclose a general or material conflict of interest (sections 127 and 128 of the Act) and the type of interest before providing advice or reports where it could be perceived that an interest might unduly influence them.

Those who have been delegated Australian Construction powers, duties or functions are prohibited from exercising those powers, duties or functions if they have a conflict of interest.

Australian Construction staff must declare to their director any items delivered to Australian Construction which were not part of the requirements of the contract and which could be construed as gifts or new assets to Australian Construction. Such items must also be referenced on supplier invoices.

Tender Evaluation

Australian Construction Staff must ensure that:

Late tenders are not accepted.

Tender and three quote evaluations are conducted in accordance with the methodology set out in Procurement Management.

An evaluation panel is established to evaluate each tender and three quote submission against the selection criteria and the evaluation plan within Procurement Management.

The tender evaluation panels composition is determined by the respective Director and the Category Manager as defined in the Procurement Plan. Three quote evaluation panel members are determined by the project manager responsible for the procurement.

Tender and three quote evaluation panels can include external personnel in order to ensure best outcome for procurement activity.

All staff involved in the evaluation process, including advisors and approvers, must complete conflict of interest declarations.

Two quote evaluations are based on best value for money.

Australian Construction Staff must consider the following:

A probity advisor may be appointed to any tender evaluation panel.

A probity auditor may be appointed to oversee the evaluation process.

The evaluation process must be robust, systematic and unbiased.

Evaluation Criteria and Value for Money

When evaluating a procurement proposal, value for money is the primary evaluation objective taking into account both cost and non-cost factors (not necessarily the lowest cost). This should include:

A cost weighting for evaluation between 60 to 100 per cent. Should a requirement for the weightingbe lowered below 60 per cent, Procurement must approve this change.

Ensure the product and service is fit for purpose.

Service and support.

Whole of life

Evaluation criteria for Tenders are confirmed in the approved Procurement Plan.

EOI

Australian Construction may determine to seek an EOI where:

There are likely to be many tenderers.

Tendering will be costly or the procurement is complex and Australian Construction does not wish to impose the costs of preparing full tenders on all tenderers.

There is uncertainty as to the willingness and / or interest of vendors to offer the required procurement.

Australian Construction requires advice from the market regarding how best to address a particular need.

The EOI must be publicly advertised.

A select tender can then be conducted from preferred respondents to the EOI.

Contract Variations

Contract variations are to be approved by the Financial Delegate or Superintendent for the value of the individual variation. The Delegate must also ensure that budget is approved for the variation.

For contracts over $250,000, when the accumulated variation value for a contract will exceed 20% of the initial awarded contract value, the Contract Manager or Director must advise the relevant General Manager. Approval must be sought from the General Manager to proceed with the variation, and that any future variations can still be approved by the Financial Delegate or the Superintendent for each variation amount. The General Manager must also ensure budget is approved for all variations.

Any individual variation to the contract award with a value over $250,000 must also be approved by the Director Procurement and Contract management, excluding construction works contracts.

All variations are to be processed through Procurement Management.

Contract Extensions

For contracts over $250,000 that have extension options, delegation approval is required to exercise the extension for the value of the option. These extension options are to be processed through Procurement Management.

Evaluating Contract Performance

In order to continually improve its outcomes, Australian Construction will evaluate and seek to improve on all aspects of procurement and contract management, in accord with procurement processes and the Supplier Relationship Management Program.

Collaborative Procurement

Where practicable, Australian Construction will collaborate with other Australian Constructions in order to take advantage of economies of scale, explore service design best practice, shared service opportunities and services plus drive innovation with suppliers. Opportunities to collaborate must be identified within the Procurement Plan.

Contract Management Plan

A segmentation of all supplier contracts is to be undertaken to determine strategic importance and risk to Australian Construction. A Contract Management plan must be created by the Branch prior to contract execution, in consultation with procurement for all contracts segmented as strategic, important and/or high risk as determined in the Procurement Plan. This plan should include risk assessment and mitigation plans and a process for enabling innovation throughout the life of the contract.

Accumulated Spend

The threshold to determine the procurement approach must allow for the potential accumulated spend with the supplier across the same project or initiative across a period of three years. The value of the accumulated spend determines the procurement approach.

Strategic Supplier and Contract Review

A Strategic assessment must be completed for strategic contracts during the course and end of the contract that:

Provides strategic enhancements during the current contract lifecycle including:

Innovation to the existing service.

Alternative or improvements to the existing service.

Added services to the contract.

Requires strategic assessment prior to contract end (generally 12 months prior to the end date) including:

Market assessment of suppliers and service delivery models.

Contract synergies across City of Melbourne services.

Strategic assessment of the service model and specification.

Review of contract structure and pricing approach.

Defines the future strategic direction.

Identifies service risk review including transition.

These reviews are completed by the branch and procurement and approved by the Branch Director and the Director Procurement and Contract Management.

Procurement procedures

Procurement activities must be undertaken in accordance with the value and risk-based requirements detailed in the Procurement procedure and the Procurement Guidelines unless an exemption has been granted
The expected life cycle cost of a procurement activity be estimated before a decision on the procurement method is made. The expected life cycle cost is the maximum value (excluding) of the proposed contract, including options, extensions, renewals, licenses, or other mechanisms that may be executed over the life of the contract.
Purchasers must consider the most appropriate manner to approach the potential supply market (market approach) in accordance with the guidance provided in the Procurement procedure. A market approach must be conducted unless an exemption applies under clause 34 below. A procurement activity is not divided into separate parts to avoid a market approach process or to reduce the level of delegation authorisation.
Purchasers must obtain written authorisation to commence a market approach process from a staff member within their sponsor area or at an aligned higher level with a financial delegation for general expenditure of at least $300,000 (refer to the Delegations policy), so long as that activity is within a current budget or has been endorsed by the Portfolio Board.
All purchases with a contract value of greater than $300,000 must be facilitated in conjunction with or by the Procurement Services Group. Facilitation by the Procurement Services Group also applies to the ongoing purchase of goods or services where the aggregated value of those purchases across the University is greater than $300,000 over the life of a contract (refer the Procurement procedure and the Procurement Guidelines).

Purchasers must use University standard form market approach or similar request documents unless approval for the use of other documentation is granted by the Procurement Services Manager. Documents must be developed in accordance with the requirements of the Procurement GuidelinesAny market approach request greater than $100,000 (exclusive of GST) must be released and managed through the Universitys e-tender portal Tenderlink or another approved portal
All responses to a market approach received by the University must be:

uploaded to the University document management system

evaluated in accordance with the requirements of the Procurement Guidelines.

3. A market approach report must be prepared which identifies the preferred respondent. This report must be approved by a person with the appropriate delegation under the Delegations policy.

4. All respondents must have access to market approach debriefings at an appropriate point in the procurement process. Debriefings are the responsibility of the staff member facilitating the market approach.

Procurement record keepin

Procurement Record documentation must include the decisions made and the approach taken in the Procurement process together with other documentation with respect to Contracts and Contractors/Vendors, as set forth in these Guidelines

Procurement Records includes:

the documentation of the deliberative process by which a Procurement Contractor is selected, and the approach taken in the procurement process; and

the documentation pertaining to each contract amendment to any Procurement Contract.

Request for Information (RFI)

Request for Proposal (RFP)

Request for Quotation (RFQ).

Appendix 2

Assessment Templates

Activity 2 template

Project objectives
Project needs
Project budget
Procurement requirements.

Procurement management plan template

Project Name
Project Manager
Procurement Manager
What		Why	When	Who	What	Other
Description	Type	Reason	Timing	Owner	Status	Comments

Estimating
Project scheduling
Vendor control
Pre-qualified Vendors
Roles and responsibilities
Risk management
Legal jurisdiction
Payments
Constraints and assumptions.

Consultation documentation table

Organisation Name
Consultation Officer Name
Date of consultation
Consultation Topic
Objective of consultation	Consulted Stakeholder	Information received from stakeholder	Responses to consultation feedback received

Email format

To:

CC:

BCC:

From:

Subject:

Salutation

Message

Regards,

Sender Name

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BSBPMG537 Manage project procurement

Assessment Manual