**5.3 The procurement process**

The question of where the needed materials, components or services should be purchased – that is the assignment of suppliers – is the starting point for the procurement process (Cuber & Schmidt, 2012). While some suppliers might be known for instance due to already existing business relationships, others still need to be found and chosen. Thus, the search for suppliers is the next task within the procurement process, if an appropriate supplier of a certain material, component or service is in fact unknown. Hence, this task basically serves the purpose of identifying potential suppliers. To determine whether a supplier is generally capable of providing the required materials, parts or services, a corresponding exchange of specification information is necessary at this point. This interaction between the producer and potential suppliers is represented by a producer-supplier-interface in the course of the inter-company order execution (cf. KL4 in Fig. 14).

The suppliers are asked – in form of bid requests - to submit a respective proposal. That means intent information as well as consent information are exchanged. After the suppliers´ bids have been received, those are assessed according to company-specific criteria such as lowest price or earliest date of delivery. If it turns out in the following, that the created order plans do not comply with the overall project requirements, the created plans will have to be adjusted and the described activities need to – at least partially – be executed again. If the requirement of the producer is satisfied by the request of the supplier, the bid is classified as realizable and the respective supplier is assigned. Within the following task of order-approval, the producer first of all dispatches the orders to the involved suppliers. The corresponding exchange of consent information leads to the

Configuration Logic of Standard Business

2012).

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necessitates a regular exchange of monitoring information in the course of ordermonitoring, which is represented by a further producer-supplier-interface (cf. KL7 in Fig. 15). Another important task within the process of monitoring & controlling is the Entry of Change Requests. Those changes mainly refer to specification- or schedule-related aspects. During the following clarification of Change Requests, the feasibility of the requested changes is assessed together with the customer in due consideration of the current project situation. Since unexpected events such as the mentioned changes or delays due to malfunctions or labor slacks are naturally unpredictable, the primarily set project plans have to be adjusted continuously according to the information created in the course of the monitoring of progress and the clarification of Change Requests. That is in fact the main content of the project coordination. Upon the coordination of the project plans, it is subject to the project coordination to anticipate the occurred changes, as well as to compensate and counter their effects. In order to still realize the guaranteed delivery dates, the modified project schedules and schemes have to be forwarded to the respectively affected in-house departments or suppliers, where the detailed plans should be adjusted accordingly. If the delivery date is no longer realizable, the process-activity of project planning and order coordination of the project planning process has to be carried out again (Cuber & Schmidt,

Fig. 15. Detailed structure of the monitoring and controlling process (Schmidt, 2008)

The product/service-type-related sequence of order-handling-processes is in combination with the different product/service-types as well as the different business-relationship types

**6. Information requirements in the coordination points** 

producer-supplier-interface KL5 in the course of the inter-company order execution (cf. Fig. 14). Each order is eventually monitored and controlled in the course of the order monitoring & controlling, during which monitoring & controlling information have to be exchanged (cf. KL6 in Fig. 14).

Fig. 14. Detailed structure of the procurement process (Schmidt, 2008)
