Memory hook: Allocate by capability; contract by uncertainty.
Must remember
Estimate people, equipment, facilities and materials with availability and calendars. Resource leveling resolves over-allocation and may change the critical path or finish date; smoothing adjusts work within available float where possible. A specialist’s nominal availability is not the same as usable capacity across competing projects.
Build a procurement strategy from make-or-buy analysis, internal capability, risk and delivery constraints. Use clear specifications, evaluation criteria and acceptance terms. Fixed-price arrangements shift more cost-overrun risk toward the seller when scope is defined; cost-reimbursable arrangements leave more cost uncertainty with the buyer; time-and-materials needs rate and consumption controls. Actual contract clauses determine the real allocation of risk.
Negotiate interests, alternatives, authority and measurable commitments. Assess vendor competence, capacity, security, sustainability and continuity, not just lowest initial price. A supplier relationship may involve subcontractor/fourth-party risks. Monitor milestones, deliverable quality and contractual obligations throughout delivery.
Handle disputes and changes through agreed commercial procedures. Do not casually direct extra vendor work without considering authorization and liability. Document acceptance, outstanding claims, warranties, knowledge transfer and final payments at closure. Procurement completion and project completion are related but not identical events.
Choose under exam pressure
| Requirement | Choice and reason |
|---|---|
| Well-defined deliverable and price certainty | Consider a suitable fixed-price contract. |
| Highly uncertain research scope | Consider a controlled reimbursable arrangement. |
| Scarce person assigned twice | Reconcile priorities and capacity; level/smooth as appropriate. |
Traps
- The cheapest bid may have the highest lifecycle risk.
- Contract labels alone do not reveal every legal obligation.
Active recall
1. Leveling versus smoothing?
Leveling can change dates to fit resources; smoothing uses available float where possible.
2. Why define acceptance criteria in procurement?
To establish measurable conditions for accepting delivery.
3. Who bears more cost risk under cost reimbursement?
Generally the buyer, subject to contract controls.
4. Why consider alternatives before negotiation?
They inform leverage and the acceptability of an agreement.
5. Why monitor subcontractors?
Their failure or unsafe practices can affect the contracted service.