It should therefore be considered that in reality a good FM specification will incorporate a range of approaches on the continuum to best reflect each client's particular requirements. Public Procurement Practice SPECIFICATIONS Element 1.2a: Advantages of performance specifications n Provide opportunity for innovation; allow offerors to put forth unique solutions to defined needs n Allow end user to benefit from the latest products and technologies n Corrective action may be applied if service levels are not achieved Element 1.2b: Disadvantages of performance specifications Requirement SpecificationsDocumentation of a business need. 2.Develop the procurement strategy Depending on the scale of your project, there could be a very wide range of potential solutions and. Ten methods of procurement need specification for business purposes are dealt with. The template language can be used as a starting point from which agency managers can customize their own language. 2. By using outcome-based specifications that allow suppliers to propose innovative solutions such as new technologies, services or business models (that may have otherwise been unknown to the agency), the following benefits can be achieved: • efficiencies • increased service levels Specification and planning — Before anything, companies must put together a cohesive procurement plan and specify what services and goods will be needed, whether internally and externally. Where a robust sustainable procurement strategy is understood and endorsed by a consultant surveyor, the following benefits will be realised for all 3 key parties. Reduce market risks 4. benefits and limitations of the use of PBSs, even in the most "progressive" public procurement environments, such as the . Thus, the materials with identical nature can be purchased from different suppliers on the basis of specifications only. So the selection of procurement method plays very important role in constructions. Purchasing and Supply Management. The CIPS Procurement and Supply Cycle is the cyclical process of key steps for procuring goods or services. The cost is increased by testing to ensure that the specifications have been met. A specification can support project costing, not only the materials and products but the performance and workmanship. Specifications of a work serves as a guide to the supervising staff of the owner as well as the contractor to execute the work to their satisfaction. To accurately and effectively communicate what you want your supplier to do, to achieve and to provide. public procurement practice specifications element 1.2a: advantages of performance specifications n provide opportunity for innovation; allow offerors to put forth unique solutions to defined needs n allow end user to benefit from the latest products and technologies n corrective action may be applied if service levels are not achieved element … Make a simple list of specifications of the project. Market risks, potential frauds, cost, quality, and delivery risks constitute the most common type of risks. This study therefore looks at methods and initial steps that should be carried out in Ghana to maximize the benefits of sustainable procurement practice. The City will specify or allow any substantially equivalent or approved equal brands which are practicable in light of the City's needs. (6th ed.). This creates a higher sense of competition between the participating suppliers. Requisition 1 provides the buyer with much more scope however there is the chance that the person who raised the requisition may well change their mind / refine the specification as quotes begin to arrive. quality and participation 5 Procurement that integrates specification and requirement for improvement of quality of products and services 6 Type of procurement that integrates √ . 2.1 Value for money Procurement shall be conducted with the aim of obtaining value for money (VFM). Specification is necessary to specify the equipment tools and plants to be engaged for a work and thus enables to procure them beforehand. To quantify this 'want', 'achievement', 'provision' in order to measure milestones, the achievement of quality standards and ultimately whether the relationship has been a . It is suitable for fast track projects. 1. . The following are the main purpose of material specification in purchasing and supply management. 1. Click to see full answer. Optimizing procurement is beneficial on many levels, adding actual value to your business, such as: 1. . An effective plan saves time and money.2. There are several types of specifications. Performance Specifications (also known . The Advantages of Composition Specification in Procurement. If the collaborative contract is the only option in its spend area . A. Descriptive Format. What are the advantages of specification? However, more specifically, sustainable procurement is the process of finding, sourcing and acquiring goods and services while considering environmental and social factors. 4.2 Types of Specifications. Open tendering is shorthand for competitive bidding. Using the templates can lead to a variety of benefits: • Save time in compiling the specifications section of a solar procurement. It may be that an outsourced solution is a better option. Market Growth for new and emerging technologies. An effective plan saves time and money.2. What changes, is the depth of the specification, the specification for a train ticket is quite straight forward, get me from A to B, however for a new school construction the specification would be very detailed. Requirement specifications provide everything required to design a product, service, tool, infrastructure component, process or procedure. Much of this unplanned purchasing—responses to unanticipated stockouts or immediate needs for services—means forfeiting the benefits of high-volume purchasing. Pre-Procurement Market Testing. As the contractor is to define how performance requirements are to be met, this obviates the need for the client to spend the considerable time and expense necessary in preparing detailed "input" specifications. As the need to do more with fewer increases, procurement leaders are trying to figure a way to control costs and mitigate risks while trying to cope with an outdated procurement system. The objectives of a world-class procurement organization move far beyond the traditional belief that procurement's primary role is to obtain goods and services in response to internal needs. For now, however, it is useful to note that input specifications tend to be used mainly where there are legislative implications that have to be observed, for example, legionella testing or hazardous waste disposal. Advantages of tendering make it such that most organizations, as they grow, find the process appealing since it helps with the negotiations and transparency, if done properly. e-procurement system is a useful tool in government. According to the Dictionary of Architecture & Construction a specification is "a written document describing in detail the scope of work, materials to be used, methods of installation, and quality of workmanship for a parcel of work to be placed under contract; usually utilized in conjunction with working (contract) drawings in building construction". Thus, the materials with identical nature can be purchased from different suppliers on the basis of specifications only. advantages of purchasing : you get what you want and if it lasts for about a year then there was a point of getting it. "Output" specifications offer further advantages. Specifications of a work serves as a guide to the supervising staff of the owner as well as the contractor to execute the work to their satisfaction. . 1. Tip - Never design and make a product if there is an 'off-the-shelf' part available. Increase productivity and enhance efficiency 6. Collaborative Procurement: Advantages and Disadvantages. The specification may not be better than a standard product that is, readily available. (1996). Reduce development time and cost 3. to business, just like the G2C system, by improving. Advantages: 1) When a buyer has to purchase or is required to purchase a particular type of goods from more than one supplier, specifications ensure the identity of goods purchased. Reverse auction software, such as the one provided by ProcurePort, provides many controls to create unique bidding strategies. When a multi-year procurement agreement cannot be established, a proprietary bid specification can be used to implement standardization for a pre-determined number of years. Thus, the materials with identical nature can be purchased from different suppliers on the basis of specifications only. Specifications are necessary to verify and check the strength of materials for a work. Think . 4 key benefits of reverse auction software implementation within your e-procurement process Increased Supplier Competition. Software tools are needed to create the standard procurement documentation: electronic requests for information (e-RFI), requests for proposal (e-RFP) and requests for quotation (e-RFQ). Upvote (2) procurement needs. To accurately and effectively communicate what you want your supplier to do, to achieve and to provide. The briefing note made the case for the use of PBSs in public . Business units may provide high level requirements such as user stories.These are refined with a process of business analysis to be detailed enough to be considered specifications. Advantages of procurement planning are: ensures that procurement cycle are followed and each person in the cycle gets to know his or her task in delivering the product, it provides time frame indicating when the procurement process should be initiated; it is also used for soliciting/lobbying for funds for donors. disadvantages of purchasing : you spend . In determining what represents VFM, due consideration shall be given to factors such as: Key Steps for Successful Procurement Management. To quantify this 'want', 'achievement', 'provision' in order to measure milestones, the achievement of quality standards and ultimately whether the relationship has been a . It becomes increasingly difficult to derive and agree upon comment specifications. Specification is an essential contract document and is required for arbitration (dispute between the . the qualit y of communication and transactions with. . Someone could take over temporarily the regular buyers position . Additionally, compliance risks like anti-corruption, policy adherence, and more keep your procurement leaders up all night. The necessity of specification is to verify and check the strength of materials for a work involved in a project. Learn vocabulary, terms, and more with flashcards, games, and other study tools. 14 The main advantages of using a traditional procurement method are • Accountability due to a competitive selection; • Competitive equity as all tendering contractors bid on the same basis; • Design lead and the client is able to have a direct influence which can facilitate a high level of functionality and improve the quality in the overall design; • Price certainty at the award of . Various types of design specifications are the detailed descriptions of the materials, parts, and components to be used in making a product. Open Tendering. 9. Copy. Disadvantages There are requirements for which it is practically impossible to draw adequate specifications. 8 years ago. Key benefits. an explanation of what it should do, if needed. Sustainable Purchasing 101/102 • Evaluate toner/ink costs BEFORE purchasing imaging equipment • Remanufactured toner/ink cartridges cost 30-60% less per copy than "virgin"cartridges Need strict performance standards Can support local jobs • Require vendors to take-back empties to reduce disposal costs (ask for rebates) • High-yield (X or XL) toner and ink The benefits of sustainable processes are significant in the long term effects and quality of a business. This is also a fair process for suppliers to ensure they are quoting on a like-for-like basis. It also makes the right decisions for avoiding the risks. Step 1. Changes to agency minimum specifications should be approved by the Central Procurement Office after consultation with the requisitioning agency. business. Material specification enables the buyer to have standard baseline for . 1. Risk reduction: risks resulting from poorly managed supply chain practices are reduced as a result of heightened due diligence and communication with suppliers and . Procurement staff is available to assist with determining which type to use. Standards ensure that products… The six types of procurement are open tendering, restricted tendering, request for proposal, two-stage tendering, request for quotations and single-source procurement. A multi-year agreement would include a cost escalation clause, take advantage of all new incentives, and offer an easy-out provision for both parties. The development, selection and use of a particular type of specification, is dependent on the situation, time, information available and needs of the user. The City may specify by brand name or substantially equivalent or approved equal brand when the use of these specifications is advantageous to the City. When developing specifications it is important to distinguish between product requirements and product preferences and build in tolerances for suppliers to adhere too and not to restrict supply and build cost into a product. benefits in any price environment. 8 important advantages of tendering you must know. 1. The use of specifications adds to the immediate cost. when you need it. All contracts require a specification, in effect the need that must be fulfilled through the contract. What benefits can outcome-based procurement produce? These are proven methods to source goods and make . Procurement methods - effect on specifications •The D-B approach can be characterized by that the product is specified by performance requirements, and consequently, not as in the case of the D-B-B approach by procedural specifications. 2. Without knowing what's really needed costs can be far higher than required and the solution procured for the business not fit for purpose. Your specification should include: a precise description of what you need. 2 Benefits of using office master specifications Improved efficiency in specifying Using an office master specification saves project specification preparation time. 2. To understand how this role is changing, we must understand what purchasing is all about, starting with the primary objectives of a world-class . . Market Analysis and Make or Buy Decision. 3. Advantages of a bill of quantities - Designing Buildings - Share your construction industry knowledge. Product supply chain processes are executed as either 'push' or 'pull', or ' push pull'. Specifications are necessary to verify and check the strength of materials for a work. State Agency recommended specifications may be approved as stated or modified by the Central Procurement Office to enhance competition. Benefits of Standards: There are lots of benefits of using standards, like 1. Thus tender rate without specification of works is baseless, incomplete and invalid. 5.3.2.1. An alternate is a product acceptable to the engineer or specification writer for which the bidder . The purpose of a good specification is twofold: 1. 3. The vision for the industry is to standardize specifications for procurement for equipment and packages, facilitating improved standardization of major projects across the globe. 5. Reduced cost Effective management of procurement will enable an organization to lower costs by procuring supplies, services, and contracts at the best price. For example, according to a report from the United Nations: New York: McGraw Hill. The design and construction contract offers the following advantages: shorten design time Simplify construction plans, alternatives to value engineering are always available for discussion and analysis, reduce construction schedule, minimize communication channels with a single point of contact, minimum change orders, quick calendar, adapted to the actual conditions of the site easily . This in turn should reduce the cost to the client of tendering . Develop the Strategy and Plan. Here are the 8 key benefits of e-procurement system. Ultimately reduce cost for consumers 7. Advantages: 1) When a buyer has to purchase or is required to purchase a particular type of goods from more than one supplier, specifications ensure the identity of goods purchased. 1. As the selection of procurement makes the work easier to the client in making the project successful and achieving the goals of the organization. 8 years ago. Upvote (2) the amount you need. Material specification enables correct materials procurement and delivery. One of the advantages of specifications is: a. A business's procurement, or purchasing, department is responsible for sourcing and purchasing inventory while building and maintaining . Procurement's contribution to innovation can occur in the product development phase, because 70% to 80% of the cost of a product or service is determined during the design or specification phase . It becomes increasingly difficult to derive and agree upon comment specifications. The correct use of alternate, option, and substitution is important when writing proprietary specifications as each has a fundamentally different meaning. Start studying Purchasing Ch.7: the purchase specification; an over all view. There are advantages and disadvantages to both types of specification which are considered in more detail later in another article. There are additional advantages when a technical specifications document is drawn up and it forms an integral part of the procurement process and order placement. Then, you have the tendering process itself because of the size of the document, the number of dinners, and the evaluation process. Then, you have the tendering process itself because of the size of the document, the number of dinners, and the evaluation process. Hence, they are the descriptions that tell the seller exactly what the buyer wants to purchase. 9. Compared to conformance specification, performance specification has a number of ADVANTAGES such as; The specifications are easier to draft The efficacy of specifications does not depend on technical knowledge of the buyer Supplier can use their creativity to develop the products Greater share of specification risk is borne by the supplier. Mitigate procurement risks. Along with the drawings, the specification forms part of the contractual documents, helping minimise project risk and providing support should there be any legal disputes. The procurement of goods and services for or on behalf of the Global Fund shall be conducted in a manner that is based on the principles set out below. specifications are rarely if ever based only on pure outputs, as there are always some elements of prescription required to 'frame' the service outputs. Also, it improves . Specification is an essential contract document and is required for arbitration (dispute between the . It is suitable to all clients, including in experienced clients and it is time predictable and cost certainty. This report builds on a briefing note entitled Moving Towards Performance-Based Specifications in Public Procurement that was published in December 2013. The best guarantee that the project specification will meet these high standards is to base it on a sound master specification. Preparing Specifications. Say your organization needs new laptops, you can send someone to go and shop for such or you can invite suppliers to . The purpose of a good specification is twofold: 1. For example, ideally it should be possible to fully test a product's conformance before sign-off and deployment. In this method client appoints a team of consultants to prepare drawings and also tender documents. Average breakeven cost for an example major capital project. Once the item is delivered the specification can be used to compare the delivered item to what was ordered. Since the goal of purchasing professionals is to obtain quality products and services at the best price and within the parameters of applicable laws, rules, and regulations, adequate specifications are required. A bill of quantities (sometimes referred to as 'BoQ' or 'BQ') is a document prepared by a cost consultant (often a quantity surveyor) that provides project-specific measured quantities of the items identified by drawings and specifications in the tender documentation for construction works. E-procurement advantages can only be fully realized when the systems and processes to manage it are in place. Supply risk is always a major challenge in the procurement process. Adequate specifications streamline the procurement process, while poor specifications cause unnecessary . what quality it should be. Material specification eliminates ambiguity in sourcing hence minimizing turnaround time. A well-structured specification should: foster supplier interest better engage with the market facilitate a competitive environment encourage innovation apply a high standard in the delivery of requirements be clear and simple and avoid onerous or unnecessary requirements Before preparing a specification Standard purchase specification are concise description of quality, size, weight , or count factor desired for a particular item, Specification buying will give uniformity and consistency to purchasing and receiving, that will aid to maintain a desire food cost and creat a standard product. Eliminate all the additional requirements by discussing with your client and manager, and in the end, you will get the final list of specifications important for the project. An effective plan serves as a conduit to achieving entity's objectives.3.An effective plan ensures compliance with regulatory policies.4.An effective plan provides a framework to guide procurement officers in the achievement of their tasks and duties. 2. An open proprietary specification describes a single product or system but allows the bidder to suggest an alternate or substitute product. An effective plan serves as a conduit to achieving entity's objectives.3.An effective plan ensures compliance with regulatory policies.4.An effective plan provides a framework to guide procurement officers in the achievement of their tasks and duties. Risk mitigation. If the collaborative contract is the only option in its spend area . This makes the purchasing process inefficient.. • Act as a checklist so that agencies managers address key issues throughout the process, to List all the requirements. To tackle this challenge, teams need to move away from outdated, manual . The advantages and disadvantages of the various procurement procedures Student paper 31-05-2013 Course: State aid and Public Procurement in the European Union . Advantages: 1) When a buyer has to purchase or is required to purchase a particular type of goods from more than one supplier, specifications ensure the identity of goods purchased. See answer (1) Best Answer. Step 2. A food items point of origin is an important purchasing and menu . Includes a portion of cost of quality savings Output specification. Source: Dobler, D.W., & Burt, D.N. Collaborative Procurement: Advantages and Disadvantages. 1. 2. Standards set the recognized level of quality. What makes a good specification? A detailed list should be made, which will help in establishing a budget. The actual names of these could vary depending on your company and industry, but the process remains the same. These will be cheaper, more reliable and easier to source. has to establish specifications as the basis for any submission of bids, (2) shall advertise the contract in the Official Journal, and . This is most common method of procurement. The long tail of vendors was evident at one steel manufacturer, where we found that 20% of MRO spending was dispersed among more than 1,600 suppliers, while 80% was concentrated . Tip - The purchase specification is to allow purchasing to seek competitive quotations by forwarding the purchase specification to prospective suppliers. The cycle includes 13 stages: Define Business Needs and Develop Specification. 2.

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