Standardizing procurement processes, procedures and methods – July 2004

Contents

1 INTRODUCTION .1

1.1 What is procurement? 1

1.2 Goals for procurement 1

1.3 Generic procurement procedures and methods .4

1.4 Addressing secondary objectives in a procurement system 7

2 TRANSPARENCY IN PROCUREMENT .10

2.1 Understanding transparency in the procurement context 10

2.2 Improving transparency within a procurement system .11

3 STANDARDIZING PROCUREMENT PROCESSES, PROCEDURES AND METHODS .11

3.1 Introduction .11

3.2 South African National Standards for procurement 12

3.3 Challenge procedures 20

4 MODELS FOR PROCUREMENT SYSTEMS .20

5 CONCLUSIONS 23

REFERENCES 23

Tables

Table 1: Most frequently encountered goals for government procurement systems 3

Table 2: Generic procurement procedures 5

Table 3: Generic tender evaluation methods .5

Table 4: Methods for addressing quality in procurement .6

Table 5: Classification of secondary objectives in terms of obligations placed on tenderers 7

Table 6: Generic schemes for using procurement to attain socio-economic objectives .8

Table 7: Methods used to implement policies relating to secondary objectives .8

Table 8: Probability of the risk being managed within acceptable limits in most procurements where labour and enterprises are targeted (Type I and III secondary objectives .9

Table 9: Methods for granting tender evaluation points .10

Table 10: Documents that relate to the “Tender” .14

Table 11: Documents that relate to the “Contract” .14

Table 12: SANS 1914 resource standards .16

Table 13: Manner in which SANS 294 satisfies Schooner’s systemic goals .19

Table 14: Public procurement objectives in South Africa as contained in the constitution 21

Table 15: Linkages between procurement activities, procedures and management control points in the procurement process 22

Figures

Figure 1: Generic procurement activities, associated steps and internal controls 2

Figure 2: Relationship between international procurement procedures and the generic methods 6

Figure 3: The concept of offer and acceptance (Watermeyer and Jacquet, 2004) .13

Figure 4: Structure of SANS 1914 performance based resource standards .15

Figure 5: Establishing a procurement system within an organization in accordance with the requirements of SANS 294 18

Figure 6: Universal model for implementing procurement within institutions .21