I did a co-op at J&J, and the group that I was working with was looking at sourcing completed products that J&J could sell under one of their brand names. In this case it was facial cosmetics, and I was only there for the first few stages of the project. This team was multifaceted and had members from most of the major departments within J&J consumer. The team first narrowed down what exactly we wanted in terms of the final product. Then the price point for the products were discussed. Once this was laid out my department, which handled relationships with the R&D departments of our strategic suppliers came in. We took the inputs to the companies and worked out which of our suppliers would be a best fit. The biggest issue was in negotiating a price point for us to buy from them. I was at the end of my co-op there when this was happening, but both sides were trying to get the best value, which led to friction. But the deal was getting closer as both companies realized that blowing up the relationship was a terrible idea for both of them.
We always want to make sure that we keep the quality of our products to be at its highest possibility. We do this by making sure that we only have the best ingredients for our products. I have had several instances where I've had to deal with vendors and our project team has had to work on choosing the appropriate vendor. The initial steps in dealing with the situation are setting up meetings with different vendors. One key aspect of larger companies is that they usually have approved vendors, therefore you must meet with them even if you are interested in other vendors for your specific project. We have run in to some problems with certain vendors not supplying the product on time and a vendor is the only variable in our project that we know for a fact is out of our control.
One of the topics that we learned this week is Procurement Management. What this entails is essentially handling processes that require goods and services from an outside organization via raw materials, services, etc. Ideally, you want to get a good grasp of your project and a good understanding of the scope to come up with a list of goods and services that you will need. Once you get an idea of what you need, now you have to go out and look for a place that provides you with the resource.
My question is, what are some of the steps that you have taken to choose a vendor that meets your requirements? What are some of the cost-services analyses that you have conducted to ensure that you were receiving the best product for your budget? And have you ever run into an issue?
When it comes to the selection process for procurement management, I think the first step to creating a chart or table for comparing options. Next, I would focus on opening up a stream of communication with vendors and bidders. This is the ideal time for the project manager and team to communicate the project's requirements and what they will need from the vendors, and what the vendors can get from them.
Personally, I have not done this part of project management extensively, so I can not speak on the types of cost-services analyses. I think the comparison chart methods work for me best as I've done a bit of this but on a small scale.
I haven't had too much experience with procurement management, but it seems to have significance directed towards costs and vendors. Normally it involves acquiring quality goods and services from preferred vendors within a specified budget. Something that I think is important regarding this is identifying the right vendor. Quality and cost should be analyzed before making decisions for vendors. There can also be significant legal obligations and penalties tied to the procurement process. The project manager should be familiar enough with the procurement process to make intelligent decisions regarding contracts and contractual relationships.
Asking friends who they use for their company can be a good way to find a provider. In addition, I will log my organization's needs, find sources—do my own research—measure supplier results, and consult with various suppliers to see how well they serve end-users. I'd just look for reliability, on-time delivery, and good customer service. Being sure that the offers on the price list are still negotiable is an important aspect of choosing a vendor.