Consolidated procurement plans are often developed for the whole organization, but depending on the structure and level of decentralisation these may be developed at the corporate, divisional, country office or business unit level – or even at a number of these levels.
Responsibility
At the organizational level the responsibility for preparing the plan would normally lie with the authority responsible for procurement policy and planning, but in smaller business units it may lie with the procurement officer. Consolidated procurement plans would normally be prepared annually, but in some environments where the needs are more difficult to define, e.g. because business focus is on emergency relief or on procurement agency services, these may be done more frequently, though not normally more than quarterly.
The procurement plan is always based on estimates of procurement operations to be carried out in the specified period. Some procurement needs cannot be anticipated, and the plans can therefore never be accurate. However, a procurement plan based on estimates is still better than no procurement plan.
Information sources
The information for the procurement plan should be collected by the responsible person from a variety of sources depending on the particular organization. In some cases the information can be collected by asking requisitioners and clients to complete questionnaires, while in other cases the information can be collected through Management Information Systems or ERPs.
Typically the information is collected from requisitioners, clients, project plans, forecasting systems and lists of expiring LTAs.
Data collected varies from organization to organization, but as a minimum would include:
- expected requirement for goods/services/works
- quantities
- delivery time requirements
- estimated budget.
Consolidation
Once this data has been collected from all the appropriate sources it should be consolidated into the overall procurement plan. Analysis of the plan provides an opportunity to identify potential consolidation of procurements to achieve economies of scale, to better utilize resources, and to provide an overview of the magnitude of the procurement activity. In addition, when used as a
management tool, plans can identify periods of time in which a large percentage of procurement actions are required. This information can assist in planning and distribution of workload between various projects and operational units.
Good practice
It is good practice to publish these consolidated procurement plans, for example on the organization‘s website. This provides advance information to the outside world of upcoming procurement activities and advances the key principle of transparency in procurement.
