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Integrating Procurement and Project Management

ISM's 90th Annual International Supply Management Conference

San Antonio, Texas
May 2005


Roberta J. Duffy

Robert J. Hairston, C.P.M.
Procurement Manager
Corning Incorporated

Most of us are measured and rewarded based on the work we do, but how direct is that correlation? What if, one day, your boss told you that on a recent project you hadn't given it your all, and subsequently, your paycheck was cut in half?! Most of us would probably never expect such immediate treatment. But, the idea of performance-based compensation, according to Robert Hairston, is a reality, and he says that the project management environment provides a great scope and set of tools for accurately measuring performance.

Project management and purchasing integration "generates value for scopes of work involving goods and/or services of high value, with a life of one year or more, or for circumstances with special or complex requirements and notable risk exposure for the organization," he says.

Hairston pointed out that it's quite synergetic that both the project management process and the procurement process have five steps.

The following graph illustrates how these steps correlate in each environment:

Project Management Process   Procurement Process
Initiation ... correlates to ... Define Requirements
Planning Select Supplier
Execution Produce Agreement
Control Administer Day-to-Day
Closeout Assess Performance

By Roberta J. Duffy, editor of Inside Supply Management®

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