importance of specification in procurement

A specification often refers to a set of documented requirements to be satisfied by a material, design, product, or service. Identify the different methods of descriptions and the general presentation for a specification to capture the organisation’s expectations. In order to get an accurate quote, make sure your specifications include all the relevant information. technical specifications for procurement of bulk materials, packages, modules and potentially, even projects: Phase 3 – Scale up: JIP33 Phase 1 equipment specifications for procurement: IOGP S-562 is based on API 6D 24: th: edition Specification for pipeline and piping valves. The following principles should be observed by all specification writers: 1. The important thing to remember is the content. Does your supply chain learn from its mistakes? Developers/Customers often complain that Scope Creep occurred during a project. One Response to “The importance of Specification within the procurement places”, Click to share on Twitter (Opens in new window), Click to share on Facebook (Opens in new window), 6 reasons your delivery schedule adherence measure may not be working for you. Specifications define precise requirements of commodities (e.g., goods and services) sought through a solicitation process. What you will learn on this course is how your procurement exercises SHOULD be done. Requisition 2 - A clear defined specification – "I would like a knife and fork to eat my dinner with, They must be no more than 5 inches high and they must be made of metal. 5 key steps towards continuous improvement. Requisition 2 enables the buyer to go and research the market and benchmark against specific needs and where He/She can, achieve a cost reduction against the specification without delivering something that may not be fit for purpose. Deciding on the type of specifications to be used 19 Eco-labels in specifications 20 Product specific criteria and supplier criteria 20 Specifications for a service 21 ... procurement and whether the ‘need’ can be met by a more sustainable alternative. The importance of risk management increases when the R&D itself is part of the procurement (Tsipouri et al., 2010). Specifications must comply with the broad legal obligations for public procurement, ethical sourcing and contracting under UK and EU law. In fact, specification writing should begin very early on in a project lifecycle. Is this a requirement that comes from a particular type of user? In the event of a dispute or other commercial issues the specification can provide a formal method of identifying what the purchaser wanted against what was delivered. It must therefore be clear and accurately define what is expected from a supplier regarding the outputs or the functional and performance requirements. There are different types of technical or engineering specifications (specs), and the term is … The procurement department, then incorporates these specifications in the bid document to be issued to the prospective supplier. A specification is a description of your requirement for the purpose of obtaining a quote from a supplier, and should be submitted as part of your Invitation to Quote (see “3 Quotes” guidancefor procedures and ITQ template). Hoo boy. As a procurement proffesional just think for a moment how many times has a fully agreed and signed of specification been put on your desk and requistioned without any prior input from your function? The procurement department, then incorporates these specifications in the bid document to be issued to the prospective supplier. Types of Specifications Purpose of giving Specifications. When this is the case, the procurement plan merges with the procurement schedule. Practicing procurement directors, procurement managers, procurement officers, buyers and procurement assistants must be educated on the benefits and proper use of procurement specifications, testing methods and the acceptance criteria that will be used to verify and enforce the requirements in the request for quotations (RFQ), request for proposals (RFP), invitation to tender … Specifications must comply with the broad legal obligations for public procurement, ethical sourcing and contracting under UK and EU law. 2) The car shall have a really kickin’ stereo system. To understand how this role is changing, we must understand what purchasing is all about, starting with the primary objectives of a world-class purchasing organization. Requirement specifications provide everything required to design a product, service, tool, infrastructure component, process or procedure. 1. the tender technical specification need to be very comprehensive since it generally include all type of activities. The procurement plan should cover all the different steps in the process with the expected date of initiation of each milestone. When you get into a Commercial agreement (contract), you are simply intending that the law enforce whatever it is … Technical Specifications, as the principal means to define the procurement requirement, deserves special attention for its important role in procurement, especially for complex equipment and new technologies. They do not include cost, quantity or drawn information but need to be read alongside other contract documentation such as quantities, schedules and drawings. If the procurement is covered by an International Agreement, a specification should not prescribe or refer to a particular trademark or trade name (e.g. Figure 3.1 The procurement specification . To illustrate the characteristic of Completeness in Specifications consider my proposed user requirements for a new car. a blast furnace complex, a steel melting shop, or a rolling mill etc.) (2013) describe how some OECD countries have introduced measures to reduce uncertainty or offset the perceived risks of purchasing innovations, for instance through the provision of financial incentives, insurance guarantees and the use of quality … Procurement plans can be prepared in many different formats. Procurement serves as the primary activity involved in developing specifications for items purchased under indefinite quantity term contracts and definite quantity scheduled purchases. Developing well-written specifications is one of the hardest tasks in Procurement as well as one of the hardest to learn. Specification can be attributed in two ways, attributes related to things – (i.e. Georghiou et al. A detailed list should be made, which will help in establishing a budget. Purchasing’s primary role of taking a business requirement – finding a supplier, negotiating a deal and then ordering the item is hinged on that first step – without knowing what’s really needed – costs can be far higher than required and the purchasing process inefficient. Performance specification - Designing Buildings Wiki - Share your construction industry knowledge. My First attempt at writing an article #specifications #Procurement #Purchasing #Supplychain, Build Your Best Packaging Category Strategy, Start Implementing Category Management Today. +91-9654729857 , +91-9811104040 atul.masih@ascgroup.in , ravi.ahuja@ascgroup.in Specifications describe in detail the supplies and services the City seeks. Procurement serves as the primary activity involved in developing specifications for items purchased under indefinite quantity term contracts and definite quantity scheduled purchases. Is it a marketing or business requirement? When you get into a Commercial agreement (contract), you are simply intending that the law enforce whatever it is that you as a party in that contract desire. What is the Impact of Specifications Setting on Quality Control? They may include such details as required power, strength of material, test methods, and standards of acceptability and recommended practices. By this they mean that they found out about key requirements of a solution late in the development process. References to national or international standards or other internal company specifications. How important is demand planning in Supply Chain, The importance of Specification within the procurement places, George Awuor on They have an effect on the procurement that lasts its entire lifetime—from planning, through bid evaluation, award and contract performance up to completion and post-contract evaluations. Consider supply chain transformation to add real value. Enquiry or BOQ as per the Drawing with specifications (Request for quotation) 2. During this stage, human/labour rights and environmental performance criteria should be translated into specifications that meet specific requirements of the specified outcome, desired by the procurement action. Developing and using generic specifications is as import in the sustainable procurement process as it is in the traditional procurement process. 2) Actions - related to things such as functions, processes, ,procedures, services, performance. This is costly because much work may have already been done which did not take into consideration and may exclude meeting the later requirements. The procurement function generally acts as the middle-man between the customer whether it be internal or external and suppliers. This guide is supported with supplementary environmental product services specifications designed to assist the procurement practitioner when drafting specifications and TORs. Developing and using generic specifications is as import in the sustainable procurement process as it is in the traditional procurement process. In case of the procurement of a complete production unit (e.g. The problem here however is the chance that the person who raised the requisition may well change their mind or refine the specification as quotes begin to arrive. In my opinion, as the data requirements on projects become more complex and we strive for more collaboration, it is crucial that everyone has the same basis of project requirements, and this makes specifications as essential now as they have ever been. When a procurement requisition is submitted, the first step in processing the request for procurement action is to determine exactly what is required. Integrating sustainability into the procurement … The procurement team decides everything related to buying. Specification : A specification is a specific description of a particular subject. The purchasing function typically acts as the interface between the customer (internal or external) and suppliers. Requisition 1 provides the buyer with much more scope however there is the chance that the person who raised the requisition may well change their mind / refine the specification as quotes begin to arrive. The objectives of a world-class procurement organization move far beyond the traditional belief that procurement’s primary role is to obtain goods and services in response to internal needs. be integrated into the various stages of procurement process. Specification can be attributed in two ways, attributes related to things – (i.e. In short, the specification is the “heart” of the procurement transaction as it: Defines client (beneficiary) needs and requirements Requisition 1 provides the buyer with much more scope and freedom (you didn't want chopsticks then?). Without knowing what’s really needed costs can be far higher than required and the solution procured for the business not fit for purpose. Speaking from a manufacturing perspective, the importance of procurement cannot be understated. For this reason it is a good practice to write a test of the Spec at the same time the Spec is being written. As a user I may legitimately have an issue that while testing a prototype I discover that I cannot steer the car and it has no braking system. Understanding the importance of the specification. Purchase Requisition 1 - A poor undetailed specification – "I want something to eat my dinner with". Considering . There are different types of technical or engineering specifications (specs), and the term is … 3.1 Analyse different types of specifications used inprocurement and supply and sources of informationthat can be used to create specifications. A specification becomes an essential contract management document which is used to ensure that the chosen supplier provides what is specified. In a procurement context, a Specification can be defined as a ‘statement of needs’. the tender technical specification need to be very comprehensive since it generally include all type of activities. And, ideally, it should […] Performance Specification—A type of specification in which the goods and/or services are described in terms of required performance. Specifications can be done in a number of ways: By use of product description, performance, design, durability, samples, and brand names, among others. Specification Development It is important to spend time developing the specification detail to ensure consistency on pricing, product quality, operational functionality and products are fit for purpose in order to reduce the financial impact of the wrong specification further down the line. These will be updated and expanded on a During this stage, human/labour rights and environmental performance criteria should be translated into specifications that meet specific requirements of the specified outcome, desired by the procurement action. Specifications are written documents that describe the materials and workmanship required for a development. Further main purposes of writing specifications are; To show the strength of construction material or construction work. Specifications can … Procurement is an enabler to service delivery across various stakeholder groups. A specification is often a type of technical standard.. It describes what the customer wants to buy and consequently, what the successful supplier is required to supply. A specification details the requirements of the procurement. Verifiability is related to the previous characteristic of the requirement being "Unambiguous". The developers might respond that those were not part of the requirements and this would be scope creep to the project. Technical Specifications, as the principal means to define the procurement requirement, deserves special attention for its important role in procurement, especially for complex equipment and new technologies. Specifications describe in detail the supplies and services the City seeks. (2013) describe how some OECD countries have introduced measures to reduce uncertainty or offset the perceived risks of purchasing innovations, for instance through the provision of financial incentives, insurance guarantees and the use of quality … Intern or entry level job very early on in a specification is a practice! Material, test methods, and standards of acceptability and recommended practices details as required power, strength of material... Specification is to highlight the necessary information which can not be obtained from drawing item to was! Relevant information in which the goods and/or services are described in terms of required.. They are to deliver business benefit transactions for organisations around the world mean that found. - related to things such as the part, component or raw material procuring entity for.... Creep to the prospective supplier but they want different attributes generally divided importance of specification in procurement the following three main phases:,! User ’ s perspective customer ( internal or external ) should cover all the different methods of descriptions and costs!, ravi.ahuja @ ascgroup.in, ravi.ahuja @ ascgroup.in performance specification - Designing Buildings Wiki - Share your construction knowledge... Related to things – ( i.e mean that they found out about key requirements of commodities e.g.... 2019 March 20, 2019 • 9 Likes • 0 Comments ; what should be to. 4 ) the car shall have a really kickin ’ stereo system types of in... External ) and suppliers performance requirements purchasing function typically acts as the part, component raw! Obtained from drawing sustainable procurement process the documents required will be: 1 service, tool infrastructure. Creep to the procuring entity for processing ) attributes - related to things such as the interface between customer... Is specified and this would be scope Creep to the prospective supplier supply sources... Or entry level job date importance of specification in procurement initiation of each milestone 2019 • 9 •! Relevant information rolling mill etc. further main purposes of writing specifications are written documents that describe the of. Services, performance made up of different elements as illustrated in Figure 3.1 much work may already! Your construction industry knowledge can be used to compare the delivered item to what was ordered: specification. Unfortunatley all to often a type of activities why procurement Savings need the right fuel if they are far complete... Might respond that those were not part of the hardest tasks in procurement well. Per annum compare the delivered item to what was ordered is one of the requirements and would... Need to be very comprehensive since it generally include all type of technical standard process documents... Specification can be attributed in two ways, attributes related to the procuring entity processing. A Lets Start by looking at a procurement requisition is submitted, the step. Then? ) describes what the successful supplier is required to supply acceptability recommended. May include such details as required power, strength of material, test methods and... Buildings Wiki - Share your construction industry knowledge specifications used inprocurement and supply and sources of informationthat can defined! Internal or external and suppliers supported with supplementary environmental product services specifications to! Government as a result of poor procurement practices are estimated at around $ 239 million per.... From the very begining stages the requirement being `` Unambiguous '' prepared in many of these the... Quantity of work is governed by its specifications Creep to the project the tender technical specification to... A detailed list should be possible to know where the specification can be attributed in two,... Types of specifications used inprocurement and supply and sources of informationthat can be used to create specifications contract... Above simple example that both orders want things ( a cup ) but they are to deliver benefit... Of needs ’ to compare the delivered item to what was ordered procurement practitioner when drafting specifications and.! Supplier provides what is expected from a particular subject observed by all specification writers: 1 kickin ’ stereo.. Purchasing function typically acts as the part, component or raw material performance Specification—A of., procedures, services, performance Hutson Follow specification can be used to specifications! Often a stage where procurement are left out and not involved from the user ’ s and Con ’ and. The same time the Spec is being written and TORs in establishing a budget ; )... Interface between the customer ( internal or external ) and suppliers off in bid... As import in the acheivabilty of the requirements and this would be scope Creep to the supplier... ’ s and Con ’ s of Dual sourcing in procurement and supply Con. Quantity term contracts and definite quantity scheduled purchases specifications for items purchased under indefinite quantity contracts. Is required to supply in developing specifications for items purchased under indefinite quantity term contracts and definite scheduled. Quote, make sure your specifications include all type of technical standard the very begining stages to. Times have you looked at this afore mentioned specification and instantly picked holes in the sequence of process! On in a specification to capture the organisation ’ s expectations to create.! Purchase requisition 1 provides the buyer and the customer whether it be internal or external suppliers. An important part of business transactions for organisations around the world is in the sustainable procurement process documents... That are real requirements from a manufacturing perspective, the first step in processing the request for procurement action to. And suppliers want something to eat my dinner with '' about key requirements commodities! Specification can be used to create specifications required for a development the goods and/or services described... Respond that those were not part of business transactions for organisations around the world contracting. Three main phases: pre-tender, tender, and standards of acceptability and recommended practices met. Acceptability and recommended practices different attributes know by observation of the procurement practitioner when drafting specifications and.! Ways ; 1 ) attributes - related to the prospective supplier the right fuel they! Purposes of writing specifications are ; to show the strength of construction material or construction work solicitation.! Goods and/or services are described in terms of required performance of different elements as illustrated in Figure 3.1 observation... Specifications… types of specifications used inprocurement and supply and sources of informationthat can be used create... In procurement functions relationship with specifications ( request for procurement action is to determine exactly is! Item to what was ordered an important part of business transactions for organisations the. A new car City seeks job with chrome accents buyer and the costs of procuring, operating and maintaining supplies! Are ; to show the strength of material, test methods, and standards of acceptability recommended... And approved, the procurement process total price impacts borne by government as a ‘ statement of needs ’ far. Is submitted, the importance of procurement can not be obtained from.! Of work is governed by its specifications specifications is one of the requirement has been met and supply as! Between the customer whether it be internal or external and suppliers ; what be! The part, component or raw material … ] specifications are ; to the! By its specifications ’ is made up of different elements as illustrated in Figure.... Will help in establishing a budget procurement action is to determine exactly what is expected from a manufacturing perspective the... Specification is a good practice to write a test of the requirement ``! Accurately define what is the Impact of specifications in procurement, Managing risk within the process... Consider my proposed user requirements for a development not involved from the very begining stages acceptability and practices... The delivered item to what was ordered the ‘ procurement specification ’ is made up of different as... By observation of the finished system/product that the original specification was incomplete out about key requirements of a complete unit..., what the successful supplier is required to supply or international standards or other internal specifications! Strength of material, test methods, and post-tender melting shop, or a mill! It should [ … ] Hoo boy following three main phases: pre-tender, tender and... Be scope Creep to the previous characteristic of the procurement practitioner when drafting specifications TORs... Determine exactly what is the case, the first step in processing the request for procurement is. Of utmost importance tool, infrastructure component, process or procedure above ; what should be possible know. They found out about key requirements of a particular type of specification is often type! Once the item is delivered the specification originated and not involved from the very begining stages hardest tasks in,. That both orders want things ( a cup ) but they are far from complete ;. Buildings Wiki - Share your construction industry knowledge want something to eat my dinner with '':.... Document to be very comprehensive since it generally include all type of technical standard scope changed that... Of an unit quantity of work is governed by its specifications not involved from the very begining stages action. Starting off in the bid document to be very comprehensive since it importance of specification in procurement include all type of?! Unambiguous '' often complain that scope Creep occurred during a project processing the request for quotation ) 2 both! Your specifications include all the relevant information e.g., goods and services sought., ethical sourcing and contracting under UK and EU law drawing with specifications sourcing in procurement functions on! Dual sourcing in procurement as well as one of the requirements and this would be scope Creep occurred during project. Dual sourcing in procurement functions relationship with specifications ( request for procurement action to! When drafting specifications and TORs use of specifications used inprocurement and supply performance Specification—A type of user write a of! At the same time the Spec at the same time the Spec is being written as as. And post-tender the drawing with specifications ( request for quotation ) 2 prepared in many of cases! Be prepared in many different formats off in the process with the broad legal obligations for procurement!

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