The ultimate goal of procurement planning is coordinated and integrated action to fulfil a need for goods, services or works in a timely manner and at a reasonable cost. Early and accurate planning is essential to avoid last minute, emergency or ill-planned procurement, which is contrary to open, efficient and effective – and consequently transparent – procurement. In addition, most potential savings in the procurement process are achieved by improvements in the planning stages. Even in situations where planning is difficult such as emergencies, proactive measures can be taken to ensure contingency planning and be better prepared to address upcoming procurement requests. For example:
- Advance identification of suitable suppliers of potential products frequently requested in emergency operations, including confirmation by suppliers on willingness to respond on short notice.
- Development of standard specifications/TOR/SOW for products/services/works requested in emergency operations.
Good procurement planning is essential to optimize the contribution of the procurement function towards achieving the overall goals of the organization. It supports:
- Development of Key Performance Indicators (KPIs) according to milestones and accountabilities set in the procurement plan, and use of the same to monitor performance.
- Effective and timely solicitation of offers, award of contracts and delivery of the goods, services and works required.
- Early requisition to reduce any delays in procurement and timely delivery to project sites.
- Early identification of right commodities and quantities to meet programme needs.
- Sourcing the right suppliers on time to avoid cutting corners under rush procurement to meet deadlines or budget expenditure.
- Effective supply strategy and timely programme and project implementation.
- Avoidance of unnecessary exigencies and urgencies, enabling full competition and full compliance with standard rules and procedures.
- Sufficient time to fully explore alternative procurement approaches, such as joint bidding with other organizations and use of LTAs of others.
- Strengthened procurement power vis-à-vis suppliers.
- Obtaining best prices for aggregate requirements.
- Establishment of criteria to measure effectiveness of the procurement function.
- Systematic and procedurally correct procurements.
- Development of long term agreements.
Procurement planning clarifies what is needed and when it is needed to both user and buyer. Effective procurement planning enables the UN organization and its staff to work smoothly to achieve the organization‘s goals with the right quality and quantity of inputs in place; ineffective procurement planning may result in failure to achieve those goals, putting in jeopardy the FRR and procurement principles and causing damage to the credibility of the organization.