Procurement Negotiations
“Procurement Negotiations” is a tool/technique for the process “Conduct Procurements “.
Procurement negotiations clarify the structure, requirements, and other terms of the purchases so that mutual agreement can be reached prior to signing the contract. Final contract language reflects all agreements reached.
Subjects covered should include responsibilities, authority to make changes, applicable terms and governing law, technical and business management approaches, proprietary rights, contract financing, technical solutions, overall schedule, payments, and price. Negotiations conclude with a contract document that can be executed by both buyer and seller.
For complex procurement items, contract negotiation can be an independent process with inputs (e.g., issues or an open items listing) and outputs (e.g., documented decisions) of its own. For simple procurement items, the terms and conditions of the contract can be previously set and nonnegotiable, and only need to be accepted by the seller.
The project manager may not be the lead negotiator on procurements. The project manager and other members of the project management team may be present during negotiations to provide assistance, and, if needed, to add clarification of the project?s technical, quality, and management requirements.
“Procurement Negotiations” is a tool/technique for the process “Close Procurements “.
In all procurement relationships, the final equitable settlement of all outstanding issues, claims, and disputes by negotiation is a primary goal. Whenever settlement cannot be achieved through direct negotiation, some form of alternative dispute resolution (ADR) including mediation or arbitration may be explored. When all else fails, litigation in the courts is the least desirable option.
This definition was found in the PMBOK V5
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