Assessor Resource

PSPPROC512
Plan and implement procurement category management

Assessment tool

Version 1.0
Issue Date: September 2018


The unit applies to those engaged in specialist procurement and contracting roles and is equally applicable to those in broader logistics roles.

This unit covers planning and implementing procurement category management processes for an organisation.

Category management involves allocating the goods and services procured by an organisation to a category determined by an appropriate and recognised basis. This in turn allows all procurement processes for this category of goods or services to be managed in a way that best suits the characteristics of that particular category. There are many ways to implement categories for procurement, including by type of good or service, by business function, geographically or by other characteristic such as pricing flexibility.

In practice planning and implementing for category management should be integrated within the organisation’s strategic, corporate and budget planning. The process will also be specifically impacted by procurement plans, legislation, regulation, policy and procedures. Broader government policy and government to government agreements may also impact.

Analysis of relevant markets and identification and incorporation of market information into the planning processes is an essential element.

Consideration and incorporation of Corporate Social Responsibility (CSR) principles, sustainment and environmental issues are also essential.

No licensing, legislative, regulatory or certification requirements apply to this unit.

You may want to include more information here about the target group and the purpose of the assessments (eg formative, summative, recognition)

Prerequisites

Not applicable.


Employability Skills

This unit contains employability skills.




Evidence Required

List the assessment methods to be used and the context and resources required for assessment. Copy and paste the relevant sections from the evidence guide below and then re-write these in plain English.

The evidence guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, range statement and the Assessment Guidelines for the Training Package.

Overview of assessment

Competency must be demonstrated through an ability to predict future organisational needs from the market, based on the analysis of past and current organisational and market data. A clear understanding of commercial and business trends and behaviours is required. Current planning, emerging legislative, regulatory, social, business and market trends must also be assessed in order to predict future market activities. Strategies must be developed to facilitate appropriate arrangements for category management planning and implementation to complement and enhance the achievement of organisational outcomes in a more efficient and effective manner.

Critical aspects for assessment and evidence required to demonstrate competency in this unit

Assessment must confirm an ability to:

access and use Enterprise Resource Planning systems such as financial, tender planning, HR, asset management

access and use relevant accounting information

develop and use effective performance metrics related to category management

develop and use effective category management strategies to achieve objectives

identify and apply the people skills relevant to category management

gather and analyse complex financial, business and market information and develop procurement, market and supplier profiles

identify and interpret complex legislation, regulation, policy, including international treaties, principles of CSR, sustainability, environmental and social trends

contribute to complex planning documents which support core business and organisational and government outcomes

assess local and international markets, indentify trends and develop strategies to ensure organisational market placement necessary to meet future needs

contribute to and implement category management strategies and processes within an organisation based on analysis of the characteristics of the category

consider both qualitative and quantitative factors in reaching decisions or recommendations

Consistency in performance

Competency can be demonstrated by providing evidence of undertaking a range of relevant work tasks in an actual or simulated procurement environment on a least two separate occasions.

Context of and specific resources for assessment

This unit of competency is to be assessed in the workplace or a simulated workplace environment.

Participants may need to access:

sample data on finance, procurement and markets to analyse and then to build recommendations

corporate planning documents including strategic procurement, finance, technology, logistics and human capital planning

relevant legislation

current information relevant to CSR, sustainability, environment and social legislation, trends and expectations;

relevant market information

workplace scenarios and case studies relating to organisational expectations for future and strategic development of core business

emerging market trends, such as PPPs, strategic alliances, electronic commerce, holistic service solutions, engaging the corporate sector to deliver on behalf of or instead of government

Case studies that incorporate challenges on which to develop strategies to deal with future sources of goods and/or services and the methods that may need to be employed to secure future requirements.

Method of assessment

Suggested assessment methods include:

questioning to assess understanding of key subject matter areas, such as research, analysis, markets, legislation, planning, decision making, communication and mechanisms to plan and implement category management

preparing written reports evidencing the candidate’s review of strategies and approaches adopted by other government and non-government organisations to planning and implementing category management

preparing business cases or other similar documents for approval of category management approaches

developing category management plans

preparing category performance reports

contributing to and implementing sound category management strategies and planning outcomes based on analysis and reviews

demonstrating research, communication, consultation and negotiation skills

In all cases, practical assessment should be supported by questioning to assess underpinning knowledge and those aspects of competency which are difficult to assess directly. Questioning techniques should suit the language and literacy levels of the candidate, but not compromise the integrity of the assessment.

Guidance information for assessment

Evidence must be gathered over time in a range of contexts to ensure the person can achieve the unit outcome and apply the competency in different situations or environments. Holistic assessment with other units relevant to the industry sector, workplace and job role is recommended.

PSPETHC501B Promote the values and ethos of public service

PSPGOV507A Undertake negotiations

PSPLEGN501B Promote compliance with legislation in the public sector

PSPOHS501A Monitor and maintain workplace safety

PSPPROC503B Manage contract performance

PSPPROC504B Finalise contracts

PSPPROC505A Manage procurement risk

PSPPROC506A Plan to manage a contract

PSPPROC507A Plan for procurement outcomes

PSPPROC508A Make procurement decisions

PSPPROC509A Participate in budget and procurement review processes


Submission Requirements

List each assessment task's title, type (eg project, observation/demonstration, essay, assingnment, checklist) and due date here

Assessment task 1: [title]      Due date:

(add new lines for each of the assessment tasks)


Assessment Tasks

Copy and paste from the following data to produce each assessment task. Write these in plain English and spell out how, when and where the task is to be carried out, under what conditions, and what resources are needed. Include guidelines about how well the candidate has to perform a task for it to be judged satisfactory.

Required skills

communication skills to:

consult and negotiate with the marketplace, contractors and stakeholders

network, within probity boundaries, with the marketplace, contractors and stakeholders

develop a business case

interpret complex documents, such as contracts, legislation and policy guidelines

provide feedback

research skills to:

gather and analyse organisational data

gather and analyse market data

gather and analyse stakeholder requirements

review and apply legislative, regulatory and policy requirements

identify, analyse and predict trends

change management skills to:

plan, monitor and implement change management strategies

garner support from management

promote change within the organisation

measure and monitor performance

maintain momentum

celebrate success

teamwork skills to:

model effective team management approaches

support professional development and learning in team members

respond to diversity

respond to and manage issues that arise

initiative and enterprise skills to:

apply the content of complex documents such as contracts, legislation and policy guidelines

ensure compliance with legislative and mandated policy requirements including OH&S and environmental obligations, sustainability and corporate social responsibility practices and principles in the context of planning procurement and sourcing outcomes

ensure compliance with complex government policy and inter-governmental agreements

interrogate corporate systems, such as Financial Management Information Systems (FMIS ) or asset management system to obtain data

analyse complex supply chains to identify risk, vulnerability and legality

seek and interpret market reaction

develop effective performance measurement metrics

planning and organising skills to:

undertake research and business analysis

plan procurement processes in alignment with organisational and business outcomes

document procurement planning decisions and anticipated outcomes

manage and update procurement plans and sub-plans in line with organisational, strategic and budget planning documents

apply complex strategies to develop organisational plans, including corporate, budget and procurement plans and sub plans

learning and development skills to:

stay abreast of best practice models relevant to procurement, contracting, logistics and enterprise market management

remain current with legislation, regulation, policy, government agreements and relevant legal decisions

technological skills to:

understand systems architecture

identify needs from ERPs

exploit organisational ERPs

develop and manage electronic commerce

exploit market opportunities and initiatives in electronic commerce

Required knowledge

Commonwealth, state and/or territory, or local government legislation, regulation, policies, practices, procedures and guidelines in relation to:

procurement

financial management

public sector obligations (e.g. Codes of Conduct)

consumer law

OH&S

social policy

other relevant topics

international treaties relevant to trade and procurement practices

government and inter-governmental policy and agreements in relation to procurement practices

principles and practices associated with Corporate Social Responsibility (CSR), sustainability and environmental issues as applicable to procurement and market behaviours

complex and strategic planning for a range of outcomes

research and analysis as applied to complex outcomes, trends and predictions of markets and procurement changes

decision making processes and methodologies

probity principles and issues

codes of conduct, codes of practice and standards of individual behaviour relating to procurement decisions

government procurement environment

micro and macro-economic issues applicable to market behaviours and the impact of procurement

legal issues and determinations impacting on procurement

implications for the organisation and for the market (suppliers) of key procurement strategies and/or arrangements

whole of life costing considerations and value for money

financial, costing and accounting issues relevant to procurement and contracts

cultural issues relevant to procurement and industry development in specific markets or market sectors

relationship management

change management

The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance. Bold italicised wording, if used in the performance criteria, is detailed below. Essential operating conditions that may be present with training and assessment (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) may also be included.

Corporate planning documents may include:

corporate plans

business plans

strategic plans

government white papers or similar

capability plans

strategic procurement plans

Annual Procurement Plan

Suitability may include:

natural product or service placement/fit into a category

fit to structures of the buying organisation

fit to industry, market or other organisational regimes

level of expenditure warrants creation of a category approach

level of strategic importance of products/services warrants creation of category approach

Category management means:

Manage groups of similar contracts e.g. ICT or Leasing

Communication strategies consider:

accessibility

supportability

openness

appropriate technologies

appropriate level

organisational structure

legal restrictions

Internal stakeholders may include:

procurement and contract management staff

senior management

users of the goods and services

financial management staff

legal advisers

maintenance staff

asset or fleet managers

facilities managers

logisticians, including materiel logisticians

Human Resource Management staff

IT Staff

External and market stakeholders may include:

contractors

suppliers

industry peak bodies

government

other buyers

general public

users of the goods and services (if these are not internal)

Category management plan may include:

objectives to be fulfilled over the life of the contract

definition of the benefits to be achieved

approaches to communication with stakeholders

category baseline analysis

category opportunities

risk management plan including clear descriptions of risks identified, mitigation actions and responsibility assigned

outcome based performance metrics

Category management principles means:

recognising that categories have unique characteristics that need to be managed differently

Outcome based means:

focused on what the organisation intends to achieve, rather than on what the contract is producing (output)

Performance metrics may include:

measures of efficiency

measures of effectiveness

specific measures of spend, timeliness, quality

internal measures such as staff turnover

qualitative measures such as ease of dealing with the supplier and nature of the relationship

Senior management may include:

executive management

middle management

Board of Directors

program and Project managers

key operations managers

Staff skills may be:

general work skills (such as communications, use of technology etc)

discipline specific work skills (such as accounting, procurement, IT, commerce, marketing)

category specific work skills (such as knowledge of travel or office machinery)

qualifications whether required for legal reasons or beneficial)

competencies

Enterprise Resource Planning (ERP)and document management systems may include:

an integrated information system that serves all work areas within an enterprise. An ERP system can include software for manufacturing, order entry, accounts receivable and payable, general ledger, purchasing, warehousing, transportation and human resources

document management systems may range from manual paper based filing systems to automated systems

Level of spend includes:

all resources, direct and indirect, consumed in:

acquiring goods and services

managing the procurement process including managing contracts

value, volume and breakdown of spend

Procurement options may include:

outright acquisition and ownership

lease

service delivery

holistic service solutions

Public Private Partnerships (PPP)

strategic alliances

Trends, opportunities and risks relevant to categories includes:

specific trends related to a particular category (such as travel, IT, office machinery or similar) as opposed to general market trends

discretionary and/or essential nature of supply

availability of replacement goods/services for contingency supply if category supply fails (eg due to force majeure or supply chain issues)

Recognised basis may include:

industry or service based categories such as travel, fleet, software, utilities etc

business unit/functional breakdown

geographical

degree of price flexibility for goods/services

nature/sophistication of supplies

Appropriate systems should consider:

responsiveness

capabilities

capacity

accuracy

user friendliness

integration potential

supportability

Market strategies may include:

approaches to best exploit the potential of the supply market for the achievement of outcomes

awareness of changing market conditions

understanding of and possible changing of the buyer organisation’s positioning in the market to best achieve outcomes

Strategies to manage and maintain productive relationships may include:

stakeholder expectations and needs analysis

start up workshops with suppliers

regular performance workshops

issues tracking and resolution

supplier reviews

progress meetings

communications plan and contract management plan

Sources may include:

IT systems including financial, tender publishing systems, HR systems and others

internal stakeholders such as end users, procurement staff etc

external stakeholders such as suppliers

benchmarking with other organisations

Category performance may include:

analysis of:

contract leakage

buyer behaviour

opportunities

risks and issues

spend levels and patterns

category trends

value obtained and benefits tracking

improvement opportunities

supplier performance

constraints and limitations

supplier provided reports which:

identify improvement opportunities

measure supplier performance

measure buyer performance

benefits tracking activities which identify:

progress on continuous improvement opportunities

progress on category objectives

off contract spend analysis, and remedy mechanisms to be progressed

significant open issues and associated corrective action plan

Trends, opportunities and risks may include:

legislative change

policy

technology

geographical

demographic

Efficiency and effectiveness may include:

best use of resources to produce results with little wasted effort (efficiency)

achievement of results that contribute to the organisation’s goals (effectiveness)

linkages between outputs of the category and achievement of organisational outcomes

Consult appropriately may include:

method of consultation

frequency of consultation

probity

sensitivity

accessibility

style, tone and level of content

audience awareness

Organisational strategies may include:

business arrangements

contracting arrangements

delivery methods

products and/or services

holistic solutions and outsourcing

PPPs

strategic alliances

Copy and paste from the following performance criteria to create an observation checklist for each task. When you have finished writing your assessment tool every one of these must have been addressed, preferably several times in a variety of contexts. To ensure this occurs download the assessment matrix for the unit; enter each assessment task as a column header and place check marks against each performance criteria that task addresses.

Observation Checklist

Tasks to be observed according to workplace/college/TAFE policy and procedures, relevant legislation and Codes of Practice Yes No Comments/feedback
Identify and assess organisational structures and business requirements from corporate planning documents in the context of suitability to adopt category management approaches for procurement and contract management. 
Develop and use effective communication strategies to engage with internal stakeholders, external and market stakeholders about category management approaches, product/services to be category managed, market and supply chain conditions. 
Develop a category management plan based on category management principles for each category to be managed that includes outcome based, transparent and manageable performance metrics for category managed items and services. 
Obtain senior management approval for the category management plan. 
Develop outcome based processes and guidelines to support category management. 
Identify staff skills and training and development opportunities related to category management and incorporate these into professional development plans. 
Identify and interrogate organisational Enterprise Resource Planning (ERP) and document management systems in order to gather and analyse data pertaining to the level of spend on various procurement types. 
Identify and analyse current procurement options adopted by the organisation and other procurement options that are available in the marketplace. 
Identify market, procurement and contract management trends, opportunities and risks relevant to categories. 
Identify and engage relevant internal stakeholders to assist in defining categories. 
Define procurement categories using a recognised basis. 
Identify and implement appropriate systems to support category and contract managers. 
Develop market strategies for categories and act on them as appropriate to the organisation. 
Implement the category management plan. 
Implement strategies to manage and maintain productive relationships with identified suppliers. 
Resolve operational issues raised by contract users and suppliers. 
Capture and analyse data from a range of sources about the category performance against the performance metrics on a regular basis and report category performance to appropriate corporate systems. 
Regularly review buying organisation, industry and market category positions to identify trends, opportunities and risks and adjust direction as indicated by the results of the review. 
Review and monitor performance metrics on a regular basis to ensure efficiency and effectiveness is achieved and maintained in category management processes. 
Consult appropriately with stakeholders, provide performance feedback and recommend corrective or improvement actions as necessary. 
Monitor buying organisation, industry and market performance and ensure organisational strategies are modified where appropriate. 
Monitor staff skills and provide appropriate skilling upgrades. 

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