Part 1
In Part 1 we enter an area which must be handled carefully by the procurement professional, especially at the management level. Since most businesses competing for complex contracts have a dedicated business development work force (or sales work force) you may find you are dealing with business development members/sales personnel during the solicitation process and upon award, a member of the business operations team steps forward to execute the contract performance requirements. Thus, we discover why you should ask who will be the business representatives executing the agreement's performance requirements if the firm is successful at winning the competition.
Critical to success of the contractual agreement start is conducting a pre-award conference. All the details of the agreement need to be reviewed so everyone is starting off together in synchronization. You do not want any surprises, so you should go over all aspects of the contractual agreement, including the terms and conditions. In this discussion the employees who will be watching and rating the contractor's performance must participate. If you remember, the Statement of Work (SOW) is the cornerstone of a solicitation and it should contain the required schedule, milestones, reports, deliverables, metrics tied to performance, etc. Without a performance measurement plan, how can we grade the supplier's performance?
How should we communicate with the supplier or contractor? I try to design quarterly performance reviews into my major contracts that examine the graded areas of the performance matrix developed from the SOW. If the supplier is located overseas should a site visit and contractual performance review be conducted annually?
The majority of contractual arrangements will probably be successful, but when performance is poor, how do we hold the contractor or supplier accountable?
Do we publish a corrective action report or cure notice? Do we have a termination for cause or convenience clause in our terms and conditions? Was the right to audit included in your terms and conditions?
Part 2
As we explored the progression to World Class Supply Management we noted supplier development was a core component of organizations that have reached the high ground of world-class status. In the transactional procurement world, the delivery of contractual requirements is held high and the supplier or contractor SHALL deliver. In the world-class procurement environment the collaborative relationship is held high to solve problems together and to raise performance.
As I examine the barriers to supplier development, I recognize and reflect of encountering many of these barriers over my 42 years in the military and business world.
Many John Deere employees have processed through this class. They have shared insight on their supplier development and now you will have the chance to examine their concepts in this part. In your presentations concerning ZF I believe you discovered their strategic procurement goals include this critical goal of developing their suppliers in numerous ways.
Part 3
In each of your organizational documents, the ethical expectations of its employees and procurement practices are probably articulated in writing. In my case a complete part on this topic is dictated in part 2 of the Florida Statutes by the Florida Legislature. The statute actually raises expectations for public procurement professionals to a different level over the normal public employee. As an officer and procurement official I must report my financial holdings, business interests and property ownership through a form each June. All of these requirements for public procurement are designed to suppression any perception of non-ethical behavior.
If your organization has a federal contract a mandate is delivered for management to create ethical guidelines for the organization with an initial and recurring ethics training requirement.
In Part 3 you will explore ethics in the world of global procurement. You will discover what "sharp practices' consist of and I will share some practices I have observed over time. Many of the protocols built within competitive bidding instructions and rules are designed to suppress sharp practices and to ensure ethical behavior. In the world-class supply management global environment you will discover demands placed on overseas suppliers ranging from elimination of child labor to outlawing bribery practices that may be common in other parts of the world