Procurement, in terms of project management, is when you need to purchase, rent or contract with some external resource to meet your project goal. These relationships, like any process in the project, need management.
Managing these relationships means getting the best quality from the outside vendors employed by the company to assist in its doing business. There are constraints in a relationship with vendors that revolve around cost and time. Procurement management is a way to more efficiently and productively handle the process of sourcing, requisitioning, ordering, expediting, inspecting and reconciliating of procurement.
However, before making partnerships or purchases, the question of whether the goods and services are required from outside vendors must be answered. Therefore, weigh the pros and cons of producing the goods or services in-house and contracting the work out. Is the relationship with outsider companies necessary and cost-effective in the long-term? Once an informed decision has been made, only then can you move forward with confidence that the steps you’re taking are financially sound and fit within your timeframe.
Once you’re ready to procure goods from a vendor, project procurement management is broken down into four processes.