Quality and Procurement

Quality and Procurement

1. Quality: the degree to which a set of inherent characteristics fulfills requirements

2. Tools and Techniques

   • Cost-Benefit Analysis
   • Cost of Quality
     • Cost of Conformance
       • spent to AVOID failures
       • Prevention Costs
         • build a quality product
       • Appraisal Costs
         • assess the quality
     • Cost of Nonconformance
       • spent BECAUSE of failures
       • Internal Failure Costs
         • found by the project
       • External Failure Costs
         • found by the customer
   • Seven Basic Quality Tools
     • Cause-and-effect diagrams
       • Ishikawa, Fishbone allows team to explore causes more deeply as needed begins with effect, goes right to left 5 whys
     • Flowcharts
       • SIPOC
     • Checksheets
     • Pareto Diagrams
     • Histogram
     • Control Chart
       • Assignable=special cause due to untrained worker/problem with machine (Can be fixed) Variation within range = normal (cannot be fixed without change in process)
     • Scatter Diagram
   • Quality Audits
     • structured, indepedent review

3. Quality Attributes

   • Conformance to requirements
     • "ilities" - Nonfunctional requirements
   • Doing it right the first time (Crosby)
   • Fitness for Use (Juran)
   • Customer Satisfaction

4. Plan Procurements: The process of documenting project purchasing decisions, specifying the approach, and identifying potential sellers

5. Two Parties

   • Seller (offeror)
   • Buyer (acceptor

6. Contract: a mutually binding agreement that obligates the seller to provide the specified product or service and obligates the buyer to pay for it

   • Mutual offer and acceptance
   • Consideration
   • Contractual Capacity
   • Legal Purpose
   • Legal form

7. Make or Buy Analysis

8. Contract Types

   • Fixed Price
     • seller agrees to do work for fixed price Liability: seller
     • Firm fixed price (FFP)
     • Fixed price incentive (FPIF)
     • Fixed price with economic price adjustment (FP-EPA)
   • Time and Material
     • Fixed price per unit (protects buyer); units of work can vary (buyer liable) Fixed price per unit (seller liable); units of work can vary (protects seller) Liability: Shared
   • Cost Reimbursable
     • buyer agrees to pay seller actual costs incurred Liability: buyer
     • Cost plus fixed fee (CPFF)
     • Cost plus incentive fee (CPIF)
     • Cost plus award fee (CPAF)

9. Statement of Work

   • defines work to be performed Addendum to procurement documents and contracts written by buyer

10. Procurement Documents

    • Request for proposal (RFP)
    • Request for quote (RFQ)
    • Request for information (RFI)
    • Invitation for bit (IFB)
    • Tender notice
    • Invitation for negotiation
    • Seller initial response

11. Evaluation criteria

    • Analytic Hierarchy Process
    • Subjective