Being SMART about procurement

Every time your organisation buys something there will be uncertainties. So you can expect threats and opportunities for you as the buyer and for your supplier.

Overruns on construction projects which cause the constructor to go bankrupt, goods or equipment which are not what was wanted, or expert advice that does not answer the questions asked, are to nobody’s advantage. Neither is accepting artificially cheap prices for a job.

All these examples happened recently. None of them needed to.

Things that could go wrong can be managed for.

 In the same way, there will be opportunities to get better results or do things quicker, which can and should be managed for.

For both cases, being SMART is an important part of purchasing.

Being SMART means being Specific about what you purchase, having Measures for what is wanted, making sure that the job is Achievable and Realistic, and being clear about the Timing.

To do this we recommend some important steps:

• Define clearly and completely what is wanted. This always includes what you want to buy but may also include the supplier’s experience, whether they are local, and the price you are willing to pay
• Be clear about who is responsible for what between you and your contractor
• Select the correct type of contract - if you are seeking advice use a consultancy contract, if you are buying a product use a contract for goods
• Consider if you need to advertise for proposals. If you do, make sure you are clear about all of what you want and treat all those who might respond fairly.
• Select fairly, and complete the contract clearly
• Provide ways for dealing with uncertainties – such as requiring insurance or building in agreed processes for dealing with the unexpected.
• Keep in touch and monitor work as the job or delivery progresses
• Evaluate and learn from what happened.

Contracting for the things you need can be a good idea, but it requires clear thinking up front and effort during the process to do well.

Talk to us and use our experience for some help …