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Procurement Contracts and Statement of Work

Unit 10 Assignment 1

This portfolio work, procurement contract analysis, selection and administration, is based on your selected business or IT project. You may choose to base your assessment on the Revive LLC case study, for the development of a new online employee orientation module, or you may continue to analyze an organization of your choice. Both business and information technology (IT) employees, as well as contractors, will be utilized in this project.

Through the project procurement process, various types of contractual agreements between the seller and buyer should be reviewed and analyzed, and the most appropriate contract type should be selected. Contracts are legal agreements that bind both parties to specific deliverables, time, and costs obligations. There are three types of contracts: fixed-price contracts; cost-reimbursable contracts; and time and material contracts. Each type has advantages and disadvantages. You will find out and decide the best type of contract after considering the circumstances, timing requirements, budget availability, and market conditions that suit your organization.

Contract administration is the process that ensures the supplier or vendor meets the contractual requirements. It is simply a matter of monitoring the performance against the agreed upon plan (contract). It is essential that project managers involve the contracting (legal) and procurement (purchasing) experts in the administration of the contract.

As part of the contract evaluation and selection process, a detailed description of the work required, including (but not limited to) scope, time, and quality, is defined in a document called the statement of work (SOW). The types of SOW documents and their associated components will be evaluated in this unit.

Scenario

For this assignment, choose either Option A or Option B. You do not need to do both. Both options will be graded using the same scoring guide.

Option A: Project Revive LLC Scenario:

At this point in the process, you need to help NearlyFree.com recognize different contract types and make the right selection for the turnaround project. As the consultant of Project Revive LLC, the final task you will complete is to create the statement of work (SOW) that describes the expectations for the new employee orientation product the third-party vendor will provide. NearlyFree.com is a fictitious company and the project documents for NearlyFree.com project scenario are located in course resources area.

Although you have a lot of experience preparing statements of work, NearlyFree.com has not completed this part of the procurement process before. So, as part of your services, you will guide NearlyFree.com through this process. Your task is to help your client recognize the benefits of a good SOW and the risks associated with a poor SOW.

Option B: You may choose a business of your own. It must include (but is not limited to) the following criteria:

  • Clearly indicate the title of the project in every assignment.
  • You must have access to the following documentation:
    • Scope statement.
    • Final deliverable and product definition.
    • Project work-breakdown structure.
    • Project schedule.
    • Quality plan.
    • Project costs (estimates and actuals).

Your Role

For both Option A or B, you are the project manager.

Requirements

Microsoft Project is the required software tool for this course due to its wide industry acceptance and its use in many project management professional roles. To make this easier, you have the ability to download and install your own version of MS Project from the Capella Microsoft Imagine WebStore using the instructions provided in the MS Imagine section of the course syllabus. See the Software Preparation and Technology Access activity for more information.

Practice using MS Project in this course helps prepare you for future professional PM roles and responsibilities; please use MS Project for those tasks supported by MS Project. If you have access to other tools such as MS Visio, MS PowerPoint, and MS Word that you believe may still meet the requirements of this course, please discuss your selected alternative with your instructor.

Use the PMBOK® Guide as the model for developing the deliverables.

Part 1: Project Contract Analysis

Deliverable: Develop a decision matrix, select a contract for your turnaround project, and provide a rationale

  • Develop a decision matrix to determine the best type of contract for the project considering the circumstances, timing requirements, budget availability, market conditions, and availability.
  • Select a contract for this project and explain your selection.

Part 2: Statement of Work (SOW) Analysis

Deliverable: Create a statement of work (SOW) for the turnaround project.

Prepare a contract SOW describing the product or service to be supplied by a third-party vendor.

  • The SOW is your opportunity to clearly communicate your requirements and expectations. Refer to similar products on the Internet for realistic information to use in your statement of work. An optional template is provided in the resources for this assessment. You may use other formats if the information thoroughly addresses the expectations and requirements of the product or service.

The SOW should address the following aspects related to the product or service to be procured:

  • Roles and responsibilities.
  • Product and deliverables schedule.
  • Deliverables and costs.
  • Change control.
  • Acceptance management.
  • Quality standards.
  • Performance data.
  • Work location.
  • Period of performance.
  • Contract to be used.

Preparation

Use the software of your choice to develop the deliverables for this assessment.

This assignment has two deliverables:

  1. Develop a decision matrix, select a contract for your turnaround project, and provide a rationale.
  2. Create a statement of work (SOW) for the turnaround project.

Deliverable Format

  • References: There is no set number of references required for this assignment. Use scholarly or academic sources where applicable.
  • Format:
    • Microsoft Project is not required for this assignment. This assignment has two parts and two deliverables.
    • Use your choice of MS Word, MS Visio or MS PowerPoint to develop the comprehensive analyses.
    • These analyses are professional documents and should therefore follow the corresponding Academic and Professional Document Guidelines PDF, including single-spaced paragraphs.
    • Use APA style and format for references and in-text citations.

Evaluation

By successfully completing this assignment, you will demonstrate your proficiency in the following course competencies through corresponding scoring guide criteria:

  • Competency 2: Apply project procurement tools and techniques to ensure project success.
    • Develop a matrix to analyze project procurement requirements for selecting a contract.
    • Justify procurement contract selection for the procurement situation.
  • Competency 4: Communicate effectively in a professional manner consistent with the standards of project management.
    • Prepare a contract statement of work (SOW) describing the product or service to be supplied by a third-party vendor.

Your course instructor will use the scoring guide to review your deliverable as if they were your immediate supervisor. Review the scoring guide prior to developing and submitting your assignment.

ePortfolio

This portfolio work project demonstrates your competency in applying knowledge and skills required in the workplace. Include this in your personal ePortfolio.