253464_Procurement_GuideAug8_for_web_English.doc

The guide only suggests general risks and where

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The guide only suggests general risks and, where relevant risks that can arise at the various steps in the procurement process. While there are many ways to define the main steps in the process, there are five key elements involved: defining the scope of work preparing and circulating the bid document evaluating bids preparing and, where relevant, negotiating the contract monitoring performance and addressing poor performance of suppliers. Risks to achieving any given procurement goal do not necessarily arise at every step of the process . Common and key risks for each step have been highlighted. You will want to consider your own processes and determine if there are other risks particular to your own procurement environment. How to use the risk management charts In identifying risks, you will want to consider both the likelihood of a risk arising as well as its potential impact. Not all risks can be avoided and even the cost of minimizing or mitigating some may not be justified. Circumstances will vary from one municipality/local board to another, depending on the following factors: A Guide to Developing Procurement Bylaws 29
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the scope of the procurement activity scale and complexity of the municipality’s/local board’s business units whether procurement is centralized or decentralized the diversity and sophistication of the potential supplier base the municipality’s/local board’s organization and history of procurement issues the council’s/local board’s risk tolerance. You will want to consider these factors when reviewing the risks noted in the following pages. One approach would be to first review whether the risk identified in the first column is relevant to your municipality/local board. If it is, consider incorporating the suggested policy (in the second column) into your bylaw/resolution. If it is not, move to the next risk. Policy or procedure? The next question to consider is whether the integrity and protection of interests measures should form part of the procedural manual or the bylaw/resolution. You may decide that some of the matters dealt with in the attached are not matters that directly affect the interests of the public and suppliers and hence do not belong in a bylaw/resolution. In that case, you may wish to recommend to your council/local board that it has a policy in place indicating that procedures will be in place to deal with the subject. As noted earlier, in formulating advice, be mindful that in the absence of policies, case law may set the policy for you. Good policies will only take you so far An important consideration about risk: procurement is an important and often complex and expensive component of municipal/local board operations. The effort to establish strong policies may return few dividends if the municipal/local board staff are untrained in all aspects of the procurement processes or are unfamiliar with the ethics policies of the municipality/local board.
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