PM FPX 5333 Assessment 5 Procurement Contracts and Statement of Work

Student Name

Capella University

PM-FPX5333 Project Budgeting, Procurement, and Quality

Prof. Name:

Date

Procurement Contracts and Statement of Work

Introduction

This report provides an in-depth evaluation of the proposals submitted by various suppliers for the New Employee Orientation (NEO) project managed by NearlyFree.com. The project, critical to the company’s operations, is currently facing significant challenges. In response, NearlyFree.com has initiated a turnaround project and issued a Request for Proposal (RFP) to identify the most suitable supplier. This analysis covers the RFP document and decision matrix, which will guide the selection of the optimal supplier for the NEO project’s success.

Understanding Project Procurement Management

Project procurement management involves acquiring necessary goods and services that are not available internally. This process consists of three main stages:

Planning: Documenting criteria for supplier selection, procurement methods, and requirements.
Organizing: Procuring project products, selecting suppliers, and awarding contracts.
Controlling: Managing contracts, monitoring performance, and making adjustments as needed.

Types of Procurement Documents

Request for Proposal (RFP): An RFP invites proposals from suppliers to provide goods, services, or assets. It includes detailed project requirements to solicit competitive bids (Marks, 2019). For NearlyFree.com’s NEO project, the RFP is essential to securing suitable suppliers.
Invitation for Bid (IFB): This document requests suppliers to submit proposals focused primarily on pricing, particularly for high-value components of the project. It is crucial for evaluating the cost and expertise of potential suppliers.
Request for Quote (RFQ): Used to gather price quotes for specific products or services. The RFQ is vital for projects requiring ongoing supplies and helps in detailed cost estimation (Saputra & Putra, 2020).
Request for Information (RFI): An RFI collects information from suppliers about their capabilities and interest in the project. It helps establish a preliminary understanding of potential suppliers before issuing an RFP (Saputra & Putra, 2020).

Current Challenges and Plans

NearlyFree.com’s Project Management Office (PMO) oversees IT services and project management. The NEO project’s current quality assurance plan is inadequate, focusing mainly on testing without sufficient details on deliverables. To address this, a comprehensive quality plan is recommended, including processes for policy implementation, quality assurance resources, and project oversight (Saputra & Putra, 2020).

Proposal Evaluation and Decision Matrix

The evaluation of submitted proposals will utilize a decision matrix to rank suppliers based on predefined criteria. This tool is crucial for assessing suppliers and selecting the most suitable one for the NEO project (Güzelsevdi, 2021).

Weighted vs. Unweighted Decision Matrix: An unweighted matrix treats all criteria equally, while a weighted matrix assigns different importance to each criterion. For the NEO project, a weighted decision matrix is employed to prioritize cost and timeline.

Example Decision Matrix for NEO Project

Supplier	Competency	Experience	Cost	Interpersonal Skills	Timeline	Market Conditions	Total Score
Supplier 1	5	2	3	5	4	4	31
Supplier 2	4	3	5	3	4	5	24
Supplier 3	4	5	5	4	4	2	34

Weighted Scores

Supplier	Competency	Experience	Cost	Interpersonal Skills	Timeline	Market Conditions	Total Score
Supplier 1	15	6	15	5	20	8	69
Supplier 2	12	9	25	3	20	10	79
Supplier 3	12	15	25	4	20	8	84

Based on the decision matrix, Supplier 3 emerges as the most favorable option with a score of 84, excelling in cost and timeline. Supplier 2 is the next best alternative with a score of 79.

Statement of Work (SOW)

The SOW outlines the tasks and scope for the NEO project turnaround. It includes:

Project Objective: Complete automation software for the New Employee Orientation Module.
Period of Performance: Six months from contract execution.
Scope: Develop a web-based HR module with features like intranet integration, electronic sign-off, and online help.

Key Performance Indicators (KPIs)

KPIs for evaluating the software include:

Development Timeline: Track progress against milestones.
Software Functionality: Assess feature implementation and defect levels.
User Adoption: Measure user engagement and feedback.
Efficiency and Time Savings: Compare manual vs. automated task completion times.
Error Reduction: Evaluate accuracy improvements.
Integration and Compatibility: Ensure seamless integration with existing systems.

Roles and Responsibilities

Project Sponsor: Anna Jenkins
Project Manager: John Ford
Project Resources: Lauren Dickerson, Pearl Snyder

Communication and Change Management

Effective communication strategies and a structured change management plan are crucial. Weekly meetings, status reports, and a centralized document system will ensure smooth project execution.

Contract and Payment

Proposed Budget: $25,000
Contract Type: Cost Plus Incentive
Payment Terms: Initial $10,000 payment, followed by monthly progress payments.

Acceptance Criteria

The project must meet specific functionality, usability, reliability, performance, security, integration, scalability, compliance, and documentation standards.

Conclusion

Supplier 3 is recommended for the NEO project based on the evaluation results. Should Supplier 3 be unable to meet expectations, Supplier 2 remains a strong alternative.

References

10 de Araújo, M. C. B., Alencar, L. H., & de Miranda Mota, C. M. (2017). Project procurement management: A structured literature review. International Journal of Project Management, 35(3), 353-377.

Güzelsevdi, C. (2021, September 9). What is decision matrix analysis? Method and examples. Projectcubicle. https://www.projectcubicle.com/what-is-decision-matrix-analysis/

Marks, H. (2019). Writing a request for proposal (RFP). In Handbook of Server Management and Administration 1999 (pp. 8-1). Auerbach Publications.

PMBOK Guide | Project Management Institute. (n.d.). https://www.pmi.org/pmbok-guide-standards/foundational/pmbok