In general, public procurement differs from procurement amongst private entities in the formality and measures applied to guarantee the observance of the governing principles, as listed above in the case of UNDP. For an easy overview, the following chart outlines the major steps applicable to UNDP, but it also reflects generally for any public procurement.
Strategic analysis and procurement plan: Identifying needs and developing a strategic approach to the procurement thereof through appropriate and timely planning are key elements to successful procurement, regardless of whether it is goods and/or services. Early and detailed planning should ideally address challenges in procurement and facilitate efficient, effective, and transparent procurement. Next chapter is dedicated to this fundamental step of strategic planning in procurement.
In accordance with the procurement plan and strategy, the procurement action will initiate with a request being defined through Technical Specifications (for Goods and Equipment) or Statement of Works (SoW for Works) or Terms of Reference (ToR for Services). In practical terms, this is typically prepared and finalized with the involvement of procurement personnel and approved, including the allocation of dedicated funding being assured.
Thereafter a method of procurement or a modality by which to solicit offers for the required goods, works and/or services must be selected depending on the nature and value/size of the project and its procurement elements. Methods of solicitation in UNDP, for example, are 1) Requests For Quotations; 2) Invitations To Bid; 3) Requests For Proposals; and 4) Local Shopping. Such methods involve different levels of formality, complexity and process. They can also target different scopes of supply markets, being the process based on either open international competition, limited international competition or local and/or national competition.
The tender (bidding) period initiates with the issuance/ publication of the Solicitation documents, which will include among other sections, the corresponding instructions to bidders, terms and conditions, technical specifications or TORs/SOWs, price schedule, and evaluation criteria. Also essential aspects as technical, commercial and qualification documents to be provided; quantities, terms of delivery and conditions are detailed, contributing to minimizing risks and ensuring quality.
Once the bidding period closes, bids received will be correspondingly opened and handed over to procurement staff for evaluation. UNDP defines Evaluation of Bids, as “The process of assessing offers in accordance with the established evaluation method and evaluation criteria, with a view to obtain best value for money for the organisation. The process needs to be conducted in a fair and transparent manner to ensure equal treatment of all bidders”.
Evaluation results in the selection of supplier/s considering the specified evaluation criteria and based on procurement principles including best value for money. A Contract or Purchase Order can be awarded to the selected supplier/s only following internal approval from the corresponding contract committees.
If necessary negotiations may be conducted with the selected supplier to finalise matters before a contract or purchase order is issued.
Contract Administration or Management is often an ignored but important stage of the procurement process to ensure that the time, cost and quality criteria are met. This will involve monitoring and liaison as necessary with the supplier and end user to ensure that all parties in a contract fully understand and fulfil their respective obligations.
