Create Your Proforma Template for Procurement Quickly and Easily

Proforma template for Procurement

good morning and welcome to the office of procurement regulations webinar on developing the annual procurement plan i am rhonda joy lewis corporate communications officer at the opr and it is a pleasure to have you join us for this informative session which is intended to provide you with guidance on the development and publication of the annual schedule of procurement activities for fiscal 2020-2021 our feature presenters for today's webinar are mr vika singh and mr ian samaru policy officers at the opr we will have our chairman and procurement regulator mr munila chan with us and while he will not officiate today he is available to take any questions that you may have as we go through the presentation it must also be noted that today's webinar is being recorded and will be shared via notification to your email before we begin the formal aspects of our session please allow me to go through some helpful tips for successful webinar experience be an active participant questions may be provided in the q a section of the portal respond to any requests for comments and questions in the chat forum please keep your contributions helpful and be considerate of the hosts and other participants and finally we welcome any feedback at the end of the webinar feel free to help us improve future webinars to better match your needs by letting us know what worked well and what didn't at this time i would like to bring your attention to the screens as we become familiar to navigate through the webinar platform this morning there are two sections on the platform that you can utilize to communicate with us the chat section can be used for general feedback during the webinar while you can utilize the q a section of the portal to submit your questions on the presentations we will also upload useful and other important links and information such as a case study and guidelines in the handout section of the portal so at this time i would like to invite miss pastor of brown head procurement policy development to deliver the opening remarks miss brown thank you rhonda i want to say a very special good morning as i warmly welcome you to the office of procurement regulations webinar on developing the annual procurement plan and the accompanying annual schedule of planned procurement activities i am pastora brown head procurement policy development at the opr between this mornings and this afternoon's sessions we have approximately 305 individuals from a wide cross-section of public bodies registered to attend this webinar and we are grateful that you have taken time from your busy schedules to actually be here albeit virtually with us today planning of the procurement activities is listed in the public procurement and disposal of public property act as the first stage of the procurement cycle in addition the act mandates that within six weeks after approval of the national budget each public body shall publish either on its website or in any other electronic format its annual schedule of planned procurement activities for the fiscal beyond that the public body is also required to provide a printed copy of its annual schedule of planned procurement activities upon request by any member of the public or any contractor or supplier [Music] to assist public bodies in fulfilling these requirements under the resources tab on the opr's website you will find a draft general guideline entitled developing the annual procurement plan and within that guideline at section 5.0 you would have noted the guidance provided on the development of the annual schedule of planned procurement activities this morning using a worked example two policy officers from the opr's procurement policy development mr vika singh and mr ian samaru will take you through the steps involved in developing your annual procurement plan at the end of today's session you will be able to answer the following questions what is the difference between the plan and the schedule why do i need to develop the plan and the schedule who is responsible for developing the plan and the schedule when should you prepare the plan and the schedule and submit them to the opr for its review you would also have gained a greater understanding of among other things how to identify and analyze your organization's procurement portfolio how to develop the various sections of the annual procurement plan including establishing your organization's procurement objectives and strategies you can use to achieve those objectives since the plan is not just a schedule of activities the vika and eon will also cover how to establish your organization's procurement capacity baseline and what strategies you can employ to build your procurement capacity over time in order to consistently improve on procurement performance and last but not least how to go about developing publishing and updating your annual schedule of planned procurement activities so now let me encourage you to give your full attention to ian and the vicar as they take you through today's webinar on developing the annual procurement plan thank you thank you very much miss brown so without further delay we now welcome policy officers ms singh and mr samuru who will take us through the presentation listen so good morning good morning everyone again and welcome to today's webinar entitled developing the annual procurement plan the main purpose of today's webinar is to assist you our primary stakeholder in preparing your annual procurement plan by providing you with a clearer understanding on exactly how this task should be performed our presentation today is divided into three main sections section 1 provides an overview of the annual procurement plan section 2 provides a step-by-step review of the annual procurement plan template which as some of you may know can be found on the opr in the opr's general guideline developing the annual procurement plan you can access this guideline on the opr's website as well as in the handout tab of today's webinar and lastly section 3 of our presentation look at the preparation of the annual schedule of plan procurement activities section 1 overview of the annual procurement plan or the plan as it will be referred to throughout our presentation so the question that some of you may be asking yourselves at this time is why why should i learn to prepare an annual procurement plan well the answer is pretty simple the public procurement and disposal of public property act mandates ministries and public bodies to prepare one under section 13 age of the act states that one of the main functions of the opr is to audit and review the system of procurement and disposal of public property to ensure compliance with the objectives of the act section 13j states that the opr shall review procurement practices and delivery systems on an annual basis to identify best practices and section 30 section 27 1 of the act states a public body shall no later than six weeks after the approval of the national budget published on its website or in any other electronic format information regarding all planned procurement activities for the following 12 months therefore it is within these sections of the act that all ministries and public bodies are required to prepare and submit their plan and failure to do so can't constitute a breach of the public procurement act now we take a look at an overview of the of the plan so what exactly is the annual procurement plan this is an internal document prepared by you in which you develop your strategy so that you can manage your procurement related risk and opportunities in relation to your procurement activities to support the delivery of your ministry or public bodies mandate the main purpose of the plan however is to ensure that procurement activities of ministries or public bodies are undertaken consistently to a high standard efficiently and effectively in order to achieve the objects outlined in the act the plan is one of the control points in the internal control framework for procurement operations and is a key tool in strengthening accountabilities in ministries and public bodies the guideline on internal control framework for procurement can also be found on the opr's website for further clarification the plan is to be developed by the name procurement officer in collaboration with the ministry of public bodies internal stakeholders that is departmental heads and budget holders utilizing its annual estimates of capital recurrent and psip expenditure so what does the plan intend to achieve one it provides a logic for allocating scarce resources to the overall procurement effort it identifies the aspect of procurement effort that will be targeted for performance improvement and associated performance measures it also focuses procurement efforts on supporting business goals and objectives section two preparing the annual procurement plan at this point i kindly direct all participants to the handle tab of the webinar where you will find a short case study that we will be that will be using throughout this presentation as a work example secondly we will be going through each section of the annual procurement plan templates as provided in the general guideline which most of you might be familiar with by now so we therefore recommend that you have these documents readily available during the presentation as it will provide you with a clearer understanding of the steps involved in preparing your plan so the this document the guideline can also be found in the handle tab as i said as well as on the opr's website so let's take a look at the case study as the name procurement officer at the ministry of technology you are asked to prepare the annual procurement plan and annual schedule of planned procurement activities for fiscal year 2020 to 2021 given the following information item 1 the ministry of technology mandate and strategy which includes one to develop and implement a reliable secure information communication and technology system two to develop and implement a performance and human resource management system for employees and three to develop and maintain a sustainable stakeholder relationship program item two of this case study includes a portfolio listing for the fiscal years 2019-2020 and 2020-2021 this portfolio listing identifies all items that were actually procured in twin in fiscal year 2019-2020 as well as all items estimated to be procured in the coming fiscal 2020 to 2021 so for example for ministries and public bodies these items will be located in your annual estimates for recurrent expenditure and development programs for smaller entities like non-governmental organizations these items may be included in your project proposals details of goods words and services required by public body that is its description quantity and cost can be found in documentation such as invoices receipts purchase orders or in the ministry or public bodies accounting software package item 3 shows the number of vendors purchase orders and transactions marked against the quadrant of the procurement portfolio analysis so based on the table we see that for fiscal 1920 the total number of vendors who provided goods works and services to the ministry of technology was eating whereas for fiscal 2020 to 21 this total is estimated to increase to 20. total british orders issued for fiscal 1920 amounted to 82 whereas the estimated amount for fiscal 2020 to 21 is estimated at 100. on transactions for fiscal 1920 amounted to 36 whereas for fiscal 2020 to 21 this amount was reduced to 15. the annual procurement planning process in order to begin our presentation our preparation sorry of the annual procurement plan for the ministry of technology let us first briefly take a look at the planning process involved in carrying out this task step one of step one includes reviewing the organization or public bodies mandate and strategy this is simply because procurement activities support the ministry of public bodies mandate or objectives on a daily basis by obtaining the necessary inputs for the ministry to do its work step two of the planning process is twofold an involved organization's procurement portfolio and its function and capability this step is critical to the planning process and on such a significant part of our presentation today will focus on explaining this step step three involves identifying strategic procurement objectives this stems from the analysis of step two however examples of such objectives may include to manage the procurement process and the supply base efficiently and effectively to minimize organization transaction costs and services step four is the development and implementation of this procurement strategy which is the completion of the annual procurement plan and the actual implementation of the plan within the ministry or public body and lastly step five measure results this involves monitoring the entity's activities and transactions to assess its performance over time and to ascertain whether the procurement strategies is present and functioning examples of monitoring tools may include monthly reports by the name procurement officer and contract delivery progress and close out reports so assuming that we have completed step one of the annual planning process which is to review the ministry's mandate as the name procurement officer or npu at the ministry of technology the starting point in preparing your annual procurement plan involves developing your portfolio listing which is step two of the procurement planning process we will now take a look at the portfolio listing for fiscal year 2019-2020 and in subsequent slides my colleague mr samaru will take you through the ensuing fiscal period so based on the portfolio listing before us we can see that the ministry of technology procured eight items for this period ranging from computer equipment promotional or corporate events contracted specialized i.t services training technology office stationery office supplies and tuna all at the total cost of two million six hundred and twenty five thousand three hundred dollars now the question arise as to what do i do with this information as a named procurement officer you are required to analyze the procurement portfolio this can be performed by utilizing several strategic sourcing tools such as the parade to analysis portals 5 5 competitive forces model supplier preferencing model the procurement portfolio analysis and supply a positioning model while this presentation will examine only some of these tools further explanation on them can be accessed on the opr's website via a video recording or even a slide presentation at your convenience so we will first analyze the procurement portfolio by using the pareto analysis now the pareto principle which is also known as the 80 20 rule is based on the premise that 20 percent of efforts can lead to 80 of results that is if 20 of all purchase transactions account for 80 or more of the total expenditure then focusing on these purchases so that administrative effort is used efficiently can optimize the return on procurement effort so let us revert to our example as the name procurement officer at the ministry of technology the first step in analyzing our portfolio listing using this spirito tool requires you to sort this list by price starting from highest value item to the lowest value item secondly a running total of all expenditure items are calculated simply by adding the cost of each item as we move down the running total column so for example the running cost at row three equals to two million one hundred and fifty seven thousand eight hundred dollars which is the sum of computer equipment corporate events and contracted specialized services it should also be noted that the that the last running total should match the overall total cost and thirdly in conducting the pareto analysis the percentage of expenditure represented by each item should be calculated and this is done by simply placing a running total over the overall annual cost and calculating a percentage now the outcome of the pareto analysis in this example shows that the first three items which are computer equipment corporate events and contracted specialized i.t services represent over 80 percent of expenditure the value of the remaining five items total less than 20 percent of the overall expenditure this would suggest that the ministry of technology should invest most of its administrative efforts in the procurement of the first three items in the list and should develop strategies to minimize its administrative effort for the procurement of the remaining five items these strategies however will be discussed later in our presentation another tool that will assist a pro curing entity which is you the ministry or public body in conducting a more in-depth analysis of its procurement portfolio is the procurement portfolio analysis tool which is also known as the coralgic matrix this tool allows the procuring entity to analyze the items or category of items in its procurement portfolio by taking into consideration the relative value of the item and the difficulty of securing supply for this item and placing it into one of the four quadrants so quadrant one rooting products are usually low value low volume items they represent routine procurement processing and typically represent up to 90 percent of the organizations suppliers and a very high proportion of transactions there's generally competitive local supply markets for these type of items so based on our case study an example of routine items may include office stationary quadrant two leverage products these are goods and services commonly used across the entire organization in high volumes they often include goods where there is potential for reduction of inventory management handling and storage costs these markets may be served by a few suppliers with extensive distribution networks based on our case study an example of a leverage item may include computer equipment quadrantry bottleneck products these are highly specialized goods services or woods the procurement of these items often involves technical experts and they are often only a few potential suppliers usually there are only a few transactions within this category therefore based on our case study an example of a bottleneck item would include toner for a very specific type of printer and lastly strategic products which represent goods services or works that are critical to the organization they are often complex bundle or package of goods and services they require innovative solutions and high level expertise from suppliers this category represents very few transactions and they are often very few suppliers available the cost in forming contracts for strategic products are substantial for both the procuring organization and the supply higher so based on our case study an example of a strategy of a strategic product would include contracted special eyes itc services for a database additionally the analysis conducted using the pareto analysis tool can assist a public body in determining whether an item belongs in low or high value category whereas the analysis conducted using quarter five forces can assist ministries or public bodies in determining whether an item belongs in low or high risk categories so our next slide provides a breakdown of the ministry of technology procurement portfolio analysis for fiscal 1920 in a tabular format now this table shows whether each item is considered a high risk or low risk item based on our portfolio analysis as well as whether items are class classified as high value or low value expenditure items based on our pareto analysis the data shown in this table can also be represented in a diagram format in our next slide now from this diagram it is much easier to see the categorization of each of the items outlined in our portfolio listing within the four quadrants it is therefore northwoody to mention that most of the items listed in our case study fall within the routine category with only one or two items placed in the leverage bottleneck and strategic categories additionally participants should note that an item categorized within one quadrant by one public body may be categorized in a different quadrant by another often due to varying procurement portfolio of each public body this diagram also shows the percentage of total spend of each fortran which will be explained further in the next slide but at this point i do implore you to take note of these percentages and the number of categories in each of these quadrants so routine items are pro amount to approximately 17.7 percent of total expenditure with four number categories leverage items amount to 63 percent of total expenditure with two number categories bottleneck items amount to 0.03 percent of total expenditure with only one number category and lastly strategic items amount to approximately 19 percent of total expenditure with only one number category so how did we calculate total spend for each category let's take an example well based on the data derived from our case study routine items amount to 17.78 of total expenditure this is calculated by adding the sum of all routine items in this case that includes training telephone office stationery and office supplies and dividing it by the overall expenditure to obtain a percentage this formula is done for each quadrant of the procurement portfolio matrix in addition to analyzing the data obtained from the portfolio listing by expenditure as explained in our previous slides this data can also be analyzed by other means as shown in the distribution of quadrant table that is by vendors purchase order transactions and categories so let us firstly analyze vendors referring to our case study you would have noticed that the total number of vendors used that is they were paid for goods and services and works rendered to the ministry of technology for fiscal 1920 amounted to 18. and out of those 18 vendors 10 of them provided routine products therefore approximately 55 of all vendors used by the ministry of technology provided only routine items next we look at purchase orders the total number of purchase orders issued for the fiscal 1920 by the ministry of technology amounted to 82. and of that 82 70 purchase orders were issued for routine items therefore approximately 85 percent of all bridges orders issued by the ministry of technology were allocated to routine items moving on to transactions now this refers to the number of rounds of procurement conducted within the fiscal period so instead of issuing for example a request for quotation every time the ministry of technology needs to purchase office stationery which may be four to five times for a year the ministry can issue or establish a framework agreement over a two-year period thereby resulting in only one transaction occurring for these type of items then reducing which will ultimately reduce the administrative effort in procuring routine products so reverting to our example 36 transactions occurred within the fiscal 1920 of which 30 were as a result of routine items therefore approximately 83 percent of all the transactions conducted ministry of technology were due to routine items lastly we analyze categories out of a total of eight categories as outlined in our portfolio listing for the ministry of technology four of these categories fall within the routine quadrant therefore routine items amount to 50 percent of all category of items used by the ministry so now at this point i will hand you over to my colleague mr sumaru to continue with our presentation thank you missing so moving forward we'll be discussing the portfolio listing for the next for the next fiscal year 2020 to 2021 and in a few slides coming up you will see an analysis for this portfolio which is similar to what's missing my colleague has done previously for 2019 on this slide you will see the category listing promotional items computer contracted services and all what have you for training telephone on of the toners the description and the estimated cost for this fiscal amounting to just over 3 million dollars next we'll undertake the pareto analysis similar exercise that my colleague just did for 2019 if you look at the columns to your right you will see that the estimated costs listed from highest to low so the descript the items were categorized and classified in that order from higher spend to the lower spend a running total simulated simulated to what missing has calculated and any percentages of total expenditure you'll see at the bottom for the running total adds up to the total estimated cost for the fiscal 2020 to 2021. now moving on further to the analysis the procurement portfolio analysis we keep adding columns to your right um as we as we want to take more analysis you would see in terms of the risk spend analysis we have identified the different items in terms of low risk high value and we have took the privilege of identifying the relevant quadrant that falls in so take for example the promotional corporate events considered the low risk high value and obviously it falls in a leveraged quadrant for the contracted specialized id service but this fiscal is the analysis reveals that is a high value in high risk and resides in the strategic quadrant replicating that data into the programming portfolio matrix you can see where we have identified the four quadrants listed the categories for each of these um procurement spend you receive a routine a low risk low value you have training telephone stationary office stationery and office supplies we have also shown the percentage of spend for each of these quadrants so for routine we have just over 20 percent for leverage over 58 the bottleneck item just under one percent and the strategic just marginally over 21 percent in distribution of the quadrants by quadrants this table follows provided distribution of the relevant quadrant and the percentage in terms of expenditure vendors purchase order transaction and categories now this figure is in line with the figure on figure 2 on section 332 of the general guidelines for developing the annual procurement plan we emphasize that including data from previous year's procurement increases the accuracy of your plan and generate a more realistic projection now this slide is of critical importance to the annual procurement plan having compared both fiscal years portfolio matrices one can see at a glance of the change in percentage of expenditure for each of the four quadrants between 2019 and 2020. more noticeably we can see that leverage items were recorded in excess of 50 percent of the total expenditure for both yes 2019 and 2020 which is indicative that the public body or ministries is benefiting from leverage procurement an example in our case would be the ict equipment given there is a large pool of supplies in the market capable of providing ict equipment you may choose to buy in bulk rather than individual items thereby increasing competition among the suppliers and securing a better deal in other words you want to achieve economies of scale one certain way to increase the competition for the goods as a public body or ministry would be by simply publishing the annual schedule of planned procurement activities on your website this form of advertising will expose your procurement activity to even more suppliers as well allowing new entrants into the market now if you look at section 331 and figure one procurement portfolio matrix within the general guidelines shows the percentages of expenditure within each quadrant which can be used as a guide refers to routine performance which has a less than five percent of expenditure leverage ranging from 20 to 30 percent bottleneck ranging from one percent to five percent on strategic taking the bulk of spend 50 to 60 now we look at the comparison of the physical period this is where it gets interesting let's draw some comparison between the fiscal years as a public body of ministry you may choose to include additional headings as what we have listed in table as part of your analysis basically the more information available allows you the opportunity to justify your plan and identify areas for future improvements example in the case whether you have a contract spanning several fiscal years the key is identifying where to record the transaction within which is within which fiscal year this table also allows you to make quick determination as to whether progress if any were made during the last fiscal say in terms of whether the percentages of transaction costs was reduced this information would be necessary to complete section 2.2 progress of the general guidelines now how do we use the plan to complete the detail as we go through the analysis we would address certain areas in terms of strategies progress procedures and system which will then feed into the plan in subsequent slides we will attempt to address each quadrant along with examples now while you're on the same table let's look at a routine a procurement a low value risk in comparing the overall percentage expenditure between 2019 2020 and 2020 to 2021 no significant increase in the percentage of expenditure for the new festival was recorded the figure just jumped from 17.78 to just over 20 percent when in fact 20.27 percent now while we are another routine procurement let's look at transaction and purchase order columns and you might ask yourself this question how can i improve in reducing my transaction cost for fiscal year 2019 2020 the percentage of transaction was 83.33 percent while purchase order order was 85.37 this basically shows that for routine procurement namely office stationaries and training a lot of time and effort was spent in 2019 on transactions being undertaken by procurement officers or administrative staff in processing purchase order and invoices this can obviously be one area of improvement but you can focus efforts to reduce transaction costs while increased efficiency moving forward for the fiscal 2020 to 2021 the percentage of transaction was projected to be over 80 while purchase order was targeted at 90 percent this simply indicates that the public audio ministry has identified years of improvement from the last fiscal in reducing transaction costs by simply introducing some form of framework agreement for routine procurements so let's look at a section 332 of the general guidelines for developing the annual program plan we look at routine procurement low value low risk so in terms of the objective what would be your objective we spoke about these in a few slides previously the objective for routine procurement would be to reduce transactional administrative costs altogether in terms of your strategy a strategy to achieve this can be setting up a framework agreement or service level agreement that is engaging a few slaps few suppliers over a specific period of time for the supply of office equipment etc in an attempt to reduce transaction time and effort this reduces the administrative work required in terms of number of purchase orders which has to be generated as an organization ministry of public body you would consider decentralization have administrative staff undertake these activities basically follow through with purchase order and invoices or process these invoices you might want also want to consider encouraging local suppliers to view your ministry or your public body as a valuable client resulting in look basically lowering your transaction cost in terms of system to make a transaction process more efficient you can look at implementing a software symbol and a spreadsheet or even going as far as using a specialized payment system ech to optimize payment and process purchase orders faster than a conventional method in this way you can reduce the cost of transaction any limiting invoice and error in terms of policies and procedures consider transferring decision making powers to lower level administrative staff so that they can make decisions at a point of need take for example any procurement of stationaries as an other public body or ministry how often would you use stationery every three months so have a system in place to allow administrative staff to make these decisions when the goods are required or needed in terms of your skills you can identify what training would be necessary for both procurement staff and administrative staff based on your routine procurement training into the use of the ach software so that it would allow the system to become more transactional now as part of the skill development you can take note that you can also visit the opr website where training material webinars are available lastly once you have analyzed the various strategies for improving the procurement objectives we must now measure the performance of the procurement system to record any improvement we can use key performance indicators in our case we would like to use the procurement cycle kpi this is used to determine the average time span between let's say a receipt of a purchase requisition basically to procure office furniture or offer stationeries to the time when the purchase orders issue to the supplier this information enables conclusion to be drawn on efficiency of the system another kpi which can which is applicable to this scenario is a quality kpi it's basically the ratio of rejection which is the value of goods rejected over the value of the goods received now we revert back to the previous slides and let's continue with the comparison of the previous table similarly to what was done for routine segments public bodies and ministries can't treat the remaining segments ingly let's focus on an another scenario a leverage item high value low risk and we'll look at our example in our case study the promotional events which are basically venues audios banners what have you as a public body or ministry one of the objectives is to have total cost reduction in leveraged procurement you may choose to buy in bulk to get a better value thereby achieving economic of scale in the case of the ict equipment in so doing transactional costs are reduced altogether since you have fewer transaction in order to push it you know in terms of purchase order in the case of promotional corporate events the strategy to achieve the objectives would be to engage advertising agencies to undertake the ministry's promotional events during off-peak hours this will allow price reduction thereby reducing the value of the procurement you can also explore the option of collaborating with other public buddies when they are taking a promotional events let's look at a bottleneck item a typical example which we have identified for the sake of history is a tuna for both fiscal years 2019 2020 and 2020 to 2021 the percentage of expenditure mostly less than one percent as mentioned earlier one of the ministry's goal and objective would be risk reduction now even though the value of the item is low any unforeseen challenges with the supply of this good would have considerable repercussion in the case of the toner a simple strategy for reducing risk would be the possibility of pulling extra stock of toners throughout the useful life of the photocopier printer strategies can be to identify alternated source of goods to meet the requirement that is see whether they are readily available alternative tuners on the market by extension in cases where you are looking at the organization or public body to procure new items or new printer copier see what products are being close to being discontinued and focused efforts on new products also consideration can be made in terms of implementing a framework agreement to secure suppliers for keys for pokey goods now a strategic item a high value higher risk of supply and we look at the contracted specialized id service for the fiscal 2019-2020 the percentage of expenditure amounts so just over 19 percent while for 2020 to 2021 the percentage of expenditures projected to 21.46 that is the ministry has increased its budgetary allocation for this strategic project in that case it will beneficial to focus greater effort in undertaking a strategic project and see what strategy can be used to achieve value for money over time now during the last fiscal the ministry indicated that it had limited experience in handling strategic project of this nature the ict equipment could be primarily due to non-availability of technical staff in terms of preparing specifications in terms of reference as a result of not fully understanding the specifics of the contracted id service they opted to tender the entire ict service under one contract this however led to several challenges cost duration being one of them during the contract management stage specifically with regards to managing your relationship with the supplier now when moving forward for this fiscal the ministry has identified that in order to achieve its procurement objective one can simply seek assistance from other public bodies to provide a required skill and capabilities you can draw a quick example you can probably leave with other government agencies like ikofttt to assist in preparing detailed specifications in terms of reference for these it services this can potentially lead to a recommendation to have the complexity of the requirements reduced which results in the services being unbundled into less complex procurement now by extension the ministry will try to maintain constant communication with suppliers the benefit of which can lead to timely identification of risk and relevant mitigation strategies such as in the case their foreign contracted i.t services are not physically available you can say basically due to a lack of flight in the country as a result measures are put in place to reduce the risk by allowing these services to work virtually so what we have done there basically in a nutshell is to be we basically we performed our risk assessment now at this point we'd like to take the opportunity to hand over to tamar rhonda thank you very much much mr summer um stakeholders at this time we will be taking a short 10 minutes intermission where you can refresh yourselves and take a little break from your screens we are seeing your questions coming in and we do have a segment for questions and answers so we encourage you to submit your questions in the q a section of our portal we will address them later on in our session so we will resume at approximately 10 12 a.m we will have a countdown timer on all screens thank you again ronda we apologize for those technical challenges so let's move on to the presentation we'll take you now to the introduction which forms part of the body of the plan itself now previously we have done several analysis on the portfolio analysis for 2019 and 2020. the information guarded and the information compiled would be fed into the body of the plan itself so at this point we want to introduce this section this section should be written once you have completed the analysis and have an appreciation of the planned improvement as it's basically an executive summary of the entire plan so the introduction speaks to one an explanation of your programmatic goals and objectives and how procurement effort supports these achievements now we'll draw some examples that what we have done during the analysis and you'll see how these examples and case studies apply to the preparation of the plan in this case for the strategic ict procurement the procuring entity must have an appreciation of the high risk of supply and high value of this item as such greater attention should be made in undertaking thorough market research in identifying your market discuss with key stakeholders to assist in developing your procurement strategies and prepare in preparation of solicitation document as part of the introduction it sets out the main focus of the plan for the current year comparing and contrasting it into previous year plan now we have done this previously when we compared both procurement portfolio for 2019 and 2020 we have looked at the track record for previous year's achievements now you want to focus on certain achievements in the forthcoming year in an effort to increase efficiency in our case the main focus in the upcoming year is to reduce transaction costs altogether the introduction also speaks to an explanation of the procurement related risk and opportunities in the forthcoming period basically we are dealing with risk management we have captured procurement related risk when we touched previously on bottleneck and strategic procurements in principle information on prior years procurement related risk form the basis for identifying possible risk in a forthcoming year procurement in prior years procurement minimal communication was held with suppliers as an example in moving forward you would try to improve and maintain a constant relationship with your suppliers through the entire procurement process this allows you the ability to identify possible risks and take the necessary mitigation approach in treating with this risk in the case of the toners and the issue of it being discontinued as an example now if you require further guidance on risk management i asked you you could visit the opr website at your convenience and there is a webinar that we did in 2019 that deals with specifically with risk management unfortunately the introductions highlights an explanation of how the plan addresses general practice specific to the public body or ministry's goal and objective as well as the objectives outlined in each segment we've looked previously at the segment under routine procurement under section 332 of the general guidelines where we dealt with specific objectives organization systems policies and procedures in support of the achievement of the public bodies was an objective section 2.0 these are current status of the entity the entity procurement management at this point of the presentation you might ask yourself as a name procurement officer what's next given our analysis of the prior performance and procurement of any strategies implemented within this period the section asks the question how are you no handling procurement it's quite simple the analysis conducted cannot be used to inform the body of the plant in terms of background what in terms of the background what is your current capacity in terms of the forthcoming procurement and how are you not going to handle this procurement it deals with progress during your analysis of the portfolio matrix when we compare and contrast both physical years we have discussed progress as it relates to weather specific objectives in terms of reducing transaction costs on increasing efficiencies were achieved it also addresses issues arising from prior year's performance this explained the result of baseline performance measurement and how these can be used to make decision in forthcoming procurement strategies let's look at each of these in in a little more detail in terms of the background under section 2.1 of the genome guidelines in our case we had to both we had two goals and objectives for the minister of technology would be to minimize transaction costs of goods and services and improve supply relationship management in terms of the procurement related challenges let's take corporate events promotional events as a leveraged procurement the goal is to benefit from leveraged procurement while attempting to reduce the value of the item to achieve this objective you would prefer to target suppliers when they again in the downtime period in the market and the competition would therefore be high the risk of engaging promotional events during peak hours can result in the lack of bids from suppliers that they would focus their efforts on other clients who basically pay on time the analysis of the procurement portfolio and the key issue in prior years performance we have done so previously when we have when we compared both procurement portfolio for 2019 and 2020 and focus on trends made within prior years portfolio this would however inform decision makings in 2020 in terms of the procurement function and the associated capacity assessment analysis on prior years strategic procurements the high value high risk procurements whether the public body or ministry achieve the outcome of these procurement at the expense of considerable amount of effort in our case the outcome of the ict equipment the output would be efforts by the procurement unit to deliver the outcome that is the public body or ministry at a time did not have the key technical staff to undertake preparation for let's say the specification for the ict equipment this task was left to the procurement staff to exit considerable effort and output to prepare in order to achieve the outcome this tfo reduces efficiency under item 2.2 progress now we've touched on progress on previous slides on identifying what progress were made during the last physical and how these lessons learned inform decision making process in the ensuing period you want to ask yourself during the last fiscal year what progress will mean treating with more routine procurement as leverage to achieve economies of scale and get better value for money you also look at further improve on the supplier relationship to allow suppliers both foreign and local to have the ability to disclose information on possible future market changes we also mentioned improvement in terms of seeking assistance from other public bodies in terms of preparing preparation of solicitation documents and assisting with evaluation which the ministry does not possess and thirdly under this section 2.0 deals with issues arising from prior performance what are your baseline measurements for measuring prior year's performance and how these will assess in the future procurement management strategies now we focus on performance management or measurement in order to do this we have to establish a baseline or starting point to draw a reference to how the procurement activities are performing the use of setting up kpis would be necessary to monitor in our case we draw on two applicable kpis the procurement cycle kpi is used to determine the average time span let's say between the publication of a procurement notice and the conclusion of the contract this information draws conclusion on efficiency of the system now based on the results of these indicators you can show several conclusions for corrective actions let's say whether the procurement department has a required staffing to execute certain levels of procurement or whether the competency level of staffing needs to improve we touch on the quality kpi which is basically the value of the goods rejected over the value of goods received as a ratio of rejection item 3.0 the purpose and need you of the annual procurement plan how to improve and manage the procurement function during the ensuing period we'll talk about general strategies for improving the procurement performance in our case the ministry of technology have identified the following procedures identify who are your stakeholders both internal and external as mentioned previously and we cannot reactivate this you need to maintain and improve constant communication with your suppliers you also need to communicate with your suppliers indicating that as a public body you do not always pay on time and it will be beneficial for suppliers of potential suppliers to have some level of cash flow identify what are the issues in this case identify and assess whether you have the competent staff procurement staffed on a tax strategy procurement then we look at the second item strategies to address procurement management in support of the program business effectiveness the strategy to address procurement management would be to have clear identification of your goals and objectives you need to identify your desired results what are these deliverables and what you expect you also need to set some time frames to achieve these objectives or deliverables you need to explain your strategy of how it would be implemented and then finally to measure performance you need to introduce kpis and thirdly under section 3.0 strategy for managing the risk and opportunities in the procurement portfolio one main risk we are familiar with is the non-participation of suppliers in doing business with public bodies probably as a result of lack of time repayment a possible way to mitigate its risks would be to establish and maintain constant communication with your suppliers and to communicate with them of upcoming procurement and that the ministry is still committed to pay and we still want to do business with you under section 3.1 of the annual procurement plan template identifies the stage of the public body of ministry's growth progress in order to develop a capacity so what are your enablers what drives your procurement now the first column lists your procurement enablers which in this case refers to procurement leadership and governance people significant procurement planning and managing supply the second column speaks to baseline period observed practices and this refers to where the public body is currently positioned in terms of its procurement capacity this can either be basic capacity and intermediate capacity or you are not advanced capacity now these levels are clearly defined in a general guidelines that you have published on our website for procurement capacity development so take for example one of the procurement enabler people the baseline period observed is that the procurement and the requisite works as individual and not as a team so that will give you an indication of your level of capacity in terms of the planned improvement for most recent periods column 3 requires public bodies to identify what improvement they intend to make in a current period regarding each procurement enabler in order to transition along the spectrum from basic to intermediate to advanced so getting back at the enabler people you would want more collaborative teamwork with procurement staff and requesters and lastly column four forthcoming year planned refers to what initiatives the public body plans to undertake in order to improve its procurement capacity in the subsequent periods so again we look at the people procurement enabler people and in terms of the fourth coming year planned you want to have clear rules and responsibilities for team members now let's move on to section 3.2 of the annual procurement plan template enhancing program business business effectiveness through better procurement management how the adopted procurement strategy will support the achievement of programmatic business schools and objectives during the forthcoming period with particular reference to the entities priorities on major projects now example in our case the strategic project the contracted id specialist service project one possible strategy would be to reduce risk and achieve value for money this can be done by considering unbundling the procurement requirements to reduce complexity having secured assistance from other public bodies who have executed similar type procurements seek guidance in terms of refining your requirements and specification to have the procurement disseminated into less complex procurement public bodies have to have to publish the annual schedule of planned procurement on your website to attract a wider pool of suppliers thereby increasing the competitiveness of the procurement this can achieve value for money and reduce the risk of supply since more vendors are available on the market by extension maintaining constant communication with suppliers really contract management stays and the availability of achieving your business goals now we have returned to the introduction you haven't added all the relevant information from the previous section this feeds into the content of the info of the introduction as its forms part of the executive summary of the annual procurement plan in summary we have analyzed the data interpret the information to make informed decision in forthcoming fisc fiscal in order to prepare the annual procurement plan for the ministry of technology now i trust that what was discussed provides clarity in terms of preparing you on your procurement plan so at this point i now pass you over to ms singh where she will take you through the annual schedule of planned procurement activities thank you mr samara so now we move on to section three the annual schedule of plan procurement activity the annual schedule of planned procurement activities is a document prepared by the ministry or public body outlining its planned procurement activities for the upcoming fiscal period it provides potential suppliers and contractors with an idea of what procurement activities a public body has planned for the next 12 months so as previously mentioned public bodies are therefore required under section 27 1 of the public procurement and disposal of public property act to publish on its website or in any other electronic format information regarding all planned procurement activities for the following 12 months no later than 6 weeks after the approval of the national budget this table provides a template for the completion of the annual schedule of planned procurement activities and requires public bodies and ministries to publish basic information on its procurement activities such as project number project name unspsc code and the opr recently completed a series of online sessions explaining the use of these codes which are available on our website for your viewing at your convenience the schedule should also include a brief description of the procurement so in our case we have the supply and delivery of 80 laptops and desktops it should also include the proposed date for issue of bidding documents expected delivery or completion date estimated project duration duration procurement method standstill period and contract type it should be noted that the estimated values of your respective procurement activities should not be included in this document i i should also mention that once you publish your annual schedule of procurement activities on your website this does not bind the ministry or public body to issue a solicitation for all procurement activities as this schedule may be updated from time to time during the fiscal year however a copy of the updated schedule shall be published on its website and it to the opr within three working days of the approval of the revised schedule the public body shall provide a printed copy of the annual schedule of procurement activities upon request from any potential contractor or any member of the public upon payment of a reasonable fee and this fee shall be in alignment with the cost of reproducing and transmitting the printed schedule to the requester so now before we conclude our presentation we would like to go through a brief recap of some of the key learning points from today's session let's look at the annual procurement plan this plan is an internal document prepared by the ministry of public body to develop strategy to manage procurement related risks and opportunities in relation to procurement activities it is developed by the name procurement officer in collaboration with ministry of public bodies internal stakeholders which are departmental heads it is developed when preparing the ministry of public bodies annual estimate of capital recurrent and psip expenditure and it should be submitted within six weeks of the approval of the national budget to the opr for viewing now we turn our attention to the annual schedule of planned procurement activities this document outlines the anticipated procurement activities of a ministry or public body for the upcoming fiscal period it is to be submitted to to the opr as an insult or an appendix to the annual procurement plan it does not include the value of procurement activities and can be updated during a fiscal period and lastly it is to be published on a ministry or public bodies website no later than six weeks after the approval of the national budget so in closing we we would like to thank you for your kind attention and we do hope this presentation provided you the public body with clarification required to successfully complete your annual procurement plan thank you very much miss singh for your presentation as well as mr samaru for going through the annual procurement plan as well as the schedule at this time we invite you to go to the q a section of our portal and we will be taking your questions we are already seeing your questions to us and just as a reminder we do have our team as part of our team our chairman and procurement regulator mr munila so should you have any questions for him directly he is here to assist all right so we start one time with the questions a first question from natalya rabazad how should public bodies deal with the procurement of marketing services given the dynamic front needed as well as being difficult to justify the quality and reputation of a film okay that is a very important question and it takes us back to the reason why we plan the procurements uh i believe the question also mentioned the fact that you needed to justify why you will be going to a particular supplier or contractor as you listen to the presentation this morning you will recognize that emphasis was placed for example on the mandate and objectives of the public body so in determining how you treat with items such as market and spend where you may want to pursue a particular level of quality the first thing you have to recognize is my is this marketing spend a one-off or is it actually an integral part of the public body's mandate that will help you to decide whether the marketing spend falls within your strategic quadrant or whether it can be considered as leverage or routine in terms of ensuring that you get the quality that you want and you want to go with the most reputable of films you will take that into consideration when you send out your solicitation document and as you evaluate submissions you will consider client references to assist you in that regard thank you very much liz brown we go to our next question from ian and he's asking is costing to be provided on expenditure of individual items or on the item category morning again and morning um all participants really nice to have all of you i ian i believe that we would have answered that question that the expenditure requesting associated with it would be on your plan not on the activities because to publish those information to the general public may compromise your ability to have some competitive advantage during the actual tenure process so we would have answered that yeah and hope that helps all right and we're seeing another question from theresa and she's asking how did we arrive at eight categories actually reason that's just for an example purpose in terms of um demonstrating the tool and you can have a hundred different areas however you may want to bundle some of them when you are doing your activities because um for example kitchen supplies stationary office supplies and so on you don't need to go wrong to remind you detail because then your um the list becomes unbelievable so you would have to use your initiative in terms of how you bundle your different activities thank you mr lalchan our next question comes from david and he's asking the percent of total expenditure is calculated based on running totals or individual costs of each item it's run in total by categories so that for example you would have seen stationary in one grouping so once you decide your grouping then you will do your cumulative totals based on your groupings that you have identified within the portfolio our next question comes from kamal and he's asking in the procurement portfolio analysis what is considered a high or low relative expenditure and again um it depends on your your unique business and each different business for example in some areas and i'm going to use two examples here for a ministry something may be a high value item but if you look at a public body like a state control enterprise that might be a very low value item so it depends on your business will determine the whole is your values and so on thank you sir our next question comes from kamal again and he's asking how do you evaluate and accommodate cost centers that are unpredictable as they are generated by external requests or demands for example the legal service again at the beginning of the year you are putting together a plan so when you put together that plan if you're a state controller enterprise you develop a budget based on your business plan based on your strategy or your strategic plan so your strategic plan drives your business plan that drives your budget in the case of the ministry you have to prepare those plans to submit to your various line ministry to the ministry of finance and therefore you must have an idea of what the requirements are whether it's legal services or consultancy services and so on because that's what you put in your plan in the first case to get budgetary approval so you must know what you are proposing to go so legal services could be under one broad head-in but you must put it because you need the budget allocation in addition to that you have to also prepare that plan for your board of directors if you're a state control enterprise because that's how you get your budget approved all we're asking you to do is to translate what's written in your budget in terms of your plan activities in terms of your plan so that all the information is already there and you just need to put it in the form that we are requesting thank you rachel is asking how is the estimated vendors purchase orders and transaction percentages derived for fiscal 2020-25 and again you would have seen based on the presentation and that's another question we got is why do you need 19 19 19 20 figures it gives you an idea from your historical information to project your future requirements so history drives the future and also the historical information that you are putting together helps you to create the efficiencies that you're looking for and both ian and devika would have mentioned when you look at the number of transactions based on your routine stuff you may want to just go instead of buying things every month you develop a framework agreement so that's where the advantage of using the data from one year translate into efficiencies in the future years so i hope that helps in clarifying it remember this is not about crunching numbers and crunching figures it gives you an opportunity to improve year on year in how you do your procurement planning and execution thank you for your response to salaam chan nirmala is asking how do you measure transactions and um let me ask first toronto to jump into that in terms of the transaction and so on okay so you what you want to recognize is that as a public body you will want the ex to analyze your spend in a number of different ways because you want to be able to determine your performance what it is like currently and how do you want to look towards improvement so what we can do in this instance is to take transactions as the number of rounds of procurement that the public body would have entered into during the fiscal so let's say for example you went out to market 25 times for the year going forward you may want to reduce the number of transactions to probably 20 by creating as was mentioned before framework agreements that way you you reduce your administrative burdens so transactions runs of procurement thank you miss brown our next question comes from janice and she's asking in calculating the portfolio analysis do you include all categories of expenditure under the ministry's portfolio for example personal expenditures goods and services minor equipment current transfers and subsidies okay so in calculating your portfolio what you are looking at is your procurement spend so that could include your capital projects it could include your developmental projects as well as your recurrent expenditure so once it's a procurement spend you include it in your portfolio what you will not include in your portfolio would be for example your hr uh costing because that is not a procurement spend thank you and uh janice and other stakeholders you also be sure to re