Stage 1: Plan

In the plan stage, consult stakeholders to understand their needs, analyse the supply market, assess risks and define your procurement strategy.
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Plan 1: Analyse business need


To analyse the business need, look at a detailed breakdown of the business’s spend-stream over time.

Process

  1. Work out if the procurement category or contract is critical for your agency. Assess the value and risk. If high, take a supplier relationship management approach.
  2. Identify internal stakeholders. Then engage them, discuss what they need from the procurement and win their commitment.
  3. Get together with your stakeholders to work out the business needs for this project. Think about the best possible outcome and how to deliver it.
  4. Agree on your business needs.

Tools and templates

Plan 2: Analyse and engage the market

You should develop a profile of the dynamics of the supply market to decide how best to interact with it.

Preparation

  • Have a clear profile of the supply market, its capabilities and the key drivers of change that will shape it over the next 12 to 36 months.
  • Be aware of anything new and innovative that the supply market could provide to deliver better value for money for your agency.
  • Understand the balance of power between your agency and the market.

Process

  1. Identify and use any arrangement that may exist at the whole-of-government level. For example, any prequalification schemes and panels or agency arrangements with a ‘piggyback’ clause.
  2. Do a thorough analysis of the supply market.
  3. Interact and engage with the supply market, complying with probity rules.

Benefits of consulting

  • A broader view of a supplier’s capability to deliver.
  • Explore new ways to meet business needs.
  • Potential savings opportunities.
  • Reduce cost of the procurement activity, for your agency and for suppliers.

Engage early

  • Engage with key industry suppliers, both existing and potential, in the planning stage and then throughout the procurement cycle.
  • Ask what the supplier thinks is important for the agency to know.
  • Include as many potential suppliers, including small and medium enterprises, as is feasible.
  • Ensure they all have the same information and access to the agency before the sourcing process begins.
  • Respect the commercial significance and intellectual property of the supplier.

Plan 3: Finalise your procurement strategy

Base your strategy on:

  • your agency’s business needs and demand-related opportunities
  • the dynamics of the supply market
  • key risks and opportunities related to the spend.

If the procurement is covered by an International Procurement Agreement, there are rules around the type of procurement process you can use. This will affect your procurement strategy and process.

For more information refer to:

Process

  1. Summarise your main findings about business needs, the supply market and risks and opportunities.
  2. Know the level of business criticality of the project and the opportunities you should drive out of the arrangement.
  3. Understand the options for getting the best out of the supply market, to deliver value for the agency. For example, know how to approach the market, what success looks like and how to manage risks.
  4. Identify benefits and how they will be delivered.
  5. Define a strategy and develop a plan to put it in place.
  6. Ensure you have support for your strategy and get it signed off by your agency head, CPO or delegate, and/or your business group.