A designated group of people should be responsible for this and should know the system. That group should be able to process purchase orders for work even if that work will be paid for by the head companies and not the alliance.

For example, I needed to get some external design work done. I had an external person who could do a set of designs for a set price. Yet it took ten weeks to actually make the purchase order so that work could start, including 10 hours of my time in going backwards and forwards trying to sort the system out.

The process included these steps:

1. Try to find out which head company was paying
2. Get the correct forms for the purchase
3. Find the sub consultant agreement forms
4. Wait until the head company could send me the right forms
5. Fill these out and sending them to the head office accounts department
6. Get them returned to me saying they were wrong and a different form should be used (different people thought different forms should be used)
7. Send the agreement forms to the sub contractor to agree to.
8. Get them back with alterations.
9. Send them to the head office corporate solicitor to check and advise.
10. Get a new form recommended and send them again to the sub consultant for agreement.
11. Get agreement and then get signatures from alliance managers.
12. Send the signed form to the head company for signatures.
13. After agreements are all signed, give these and sub consultant details to accounts department for a purchase order to be made.
14. Get this purchase order signed by alliance managers
15. Get the purchase order signed by head company.
16. Alter purchase order and agreement because different designs are now required (because of the time delay some internal staff had done some designs themselves as they were needed urgently)
17. Get signatures again (alliance, head company, sub consultant.
18. Send purchase order and agreement to sub consultant for work to be commenced.

Many of these steps took one or two weeks for review and responses. It would have been cheaper, quicker, and easier to get these designs done internally and pay overtime to get them done.

Management cost to get these processed $2000

Cost of designs $8000

These costs do not include all the purchasing and accounts department time and costs, only the direct design management costs (my time and my manager’s time).

If there was a division in the alliance office who could do all this, I could have taken the sub consultant details and price to them and they could have done this whole process in less than one hour, at a cost of perhaps $50.

• They would need all the correct forms and agreements from the head companies.
• They would need to know who authorises these forms and have easy access to these people.
• They should know what forms and agreements are used for each purpose.

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External things such as deliveries, contracts, and approvals that could delay your project if late.

They may not be your direct responsibility and are out of your control, but you need to keep watch that they are getting done and that dates are not slipping.

Deliveries are a big one here. You should make your suppliers aware of your project schedule (or the part relevant to them) to emphasise the importance of the delivery date you require of them.

Don’t say you need it by a certain date if that date is the actual date you will install it. You need to allow time for delivery, unpacking, checking, and moving to the site.

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They may have tendered or quoted a long time ago and things may have changed (such as their workload, delivery schedules, material costs etc).

Even if you are still within the validity of the quote, they may have now booked a lot more work and may struggle to meet your expected delivery schedule. Suppliers or contractors may have said they can meet the price, but often the delivery time will slip. So check if they are still capable.

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• This allows for breakages.
• This is especially important if the project is not well planned (e.g. the design is not complete at the time of order) .
• Ordering extras saves money because you get them at the bulk price instead of buying small numbers of extras later at a higher per item price.

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You should pin it to a wall in easy view.

Pipe mismatch mistakes are very common in projects, often because the project manager (or procurement manager in larger projects) did not match the designed pipe ends to the supplied equipment.

If you don’t already have a clear copy of the pipe specifications, most good drafting departments will have one or a source to get one from.

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This could be either within the company or from outside experts.

Check with internal experienced people first for contacts.

When buying specialized equipment, make sure the supplier is available for installation advice and commissioning assistance (It is often preferable to get them to commission)

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Example: A polymer dosing system was bought as a package, but the company decided not to include the pumps and piping as part of the package from the supplier. This meant the company had to design the pump and piping system, and do installation themselves. They could have bought the whole package complete on a skid. This would have saved a lot of time and money.

If the supplier had supplied on a skid, they could have simply told the company the outer dimensions and connection points, saving a lot of design and installation time.

Get the supplier to include commissioning in their price. This may cost more than doing it yourself, but will save time and probably end up costing less.

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Get a number of bids. Compare and check why a low bid is so low.
If a low bid is accepted, be especially careful in your documentation, communication, contract conditions, and liabilities.

Be aware that by taking the lowest bid (especially if it is significantly lower than the others) you will be increasing the risk that the contractor won’t be able to deliver to the quality and schedule you require.

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