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Project Management
4.1 Project Management Process
4.2 Contract Document and Specification
4.3 Contract Administration
 What is
Contract Administration?
Activities centered on the actual construction,
placing orders and completion of the project.

Procurement?
The act of obtaining or procuring something.
Procurement Process
Credit Confirmation Purchase
Application of Purchase order

Shipping
Acknowledgement Invoices
and Freight

Expediting
Credit Application
• Credit application should be made to purchase special-order
products or services.
• Application form should be completed by the client.
• Protect designers from bad credit risks.
• Typically deposits is paid before the services are rendered.
Confirmation of Purchase
• Also called a sales agreement, purchase agreement, or
contract proposal.
• Should be completed and signed by the client.
• This form legally requires the client to fulfill his financial
responsibility.
• No product or services should be ordered until the document
is signed.
• Terms and conditions must be stated. Example: partial
deliveries, changes job site, warehousing, warranties.
Purchase Order
• Often called PO.
• PO is used to initiate orders
for products and services.
• PO is critically important
legal document in contract
administration phase.
• All firms should refrain
from placing telephone
orders. To avoid mistakes in
interpreting verbal
instruction or duplication.
Purpose of Purchase Order
• Serves as means of obtaining
products and services.
• Acts as a record of all outstanding
orders. Needed for income tax
calculations and loan applications.
• Used to verify information.
• Act as control mechanism for billing
clients.
• Checking correct pricing of various
suppliers.
• Hard copy of digital purchase orders
help maintain accurate record.
Acknowledgement
• Document sent by the manufacturer after receiving the
purchase order.
• Also known as confirmation or order updates.
• Each acknowledgment must be checked against the purchase
order.
Invoices
• An invoice is simply a bill.
• Suppliers send invoices to the designer for the products and
services that they ordered.
• Invoice is usually send at the same time as the merchandise.
• Look very similar to acknowledgement.
• Invoices must be paid, acknowledgement is only for
confirmation.
Shipping and Freight
• Extra charges for shipping products that are not locally
available.
• Products are transferred by truck, train, ship or aircraft.
• It is important to inspect all the items as they arrive.
• Bill of lading is the form supplier provides to the truck driver
to show what is being shipped and who has the title to the
goods.
• The content of the freight must match with the form.
• Any damages to the product must be shown to the driver and
make notations to the bill of lading for claim purposes.
• Taking pictures of damaged item is always a good idea.
Expediting
• The management of procurement by monitoring all
paperwork going out and coming in to be sure that items
ordered correctly, that the item requested is what will be
shipped, and that the items received are the items ordered.
• The expediter is a person who constantly monitors all orders
after the purchase orders have been sent and the
acknowledgement has been received.
• Checking the shipping date and tracking shipment. Foresee
the need of warehousing in case the merchandise is arriving
earlier than expected.