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The project procurement management knowledge area includes processes that are used to manage what to procure and when to procure it.

Reference Material to Study

What to Study?

Key Definitions

Back Charge
Cost of corrective action by purchaser and chargeable to the supplier under terms of the contract.
Bid Protest
allows an unsuccessful supplier an opportunity to protest the award of a government contract to another supplier.
Bill of Lading
A receipt issued by a carrier for merchandise to be delivered to a party at some destination.
Constructive Change
occurs when the PM's conduct enables performance differing from that prescribed by the contract. The PM's conduct in effecting constructive change may either be affirmative or a failure to act. Not part of change control of contract: For instance, if final product performs better than standard specified in contract, or if the PM increases the quality over and beyond what's stated in the contract.
a legal document of purchase or sale which is binding on both parties.
When entering into a contract, the people involved must have legal capacity to do so. (the definition of legal capacity varies from state to state). Consideration must be provided to both parties (in other words, there must be sufficient cause to contract). There must be mutual assent.
Invitation for Bid (IFB)
PMBOK equates this with Request for Proposal and recognizes that it may have a more specific meaning in certain application areas. (appropriate for high dollar, standard items.)
In order to get an award, a contractor may submit at bid that's unrealistically low.
Pink Team Review
A seller responds to an RFP by developing a proposal. For sanity purposes, the proposal is passed through the pink team once the outline is completed. The pink team looks at the outline through the perspective of the buyer. The purpose of the team is to catch problems with the proposal in the early stages.
Price Forecast
based on information gathered and analyzed about demand and supply. This forecast provides a prediction of short and long term prices and the underlying reasons for those trends.
Red Team Review
Once the proposal is in draft form, it passes through a red team which again looks at the proposal through the buyer's perspective.
A judicial remedy by which a court interprets the contract so as to express the real intention of the parties (this is different from changes to the contract)
Request for Proposal (RFP)
A type of bid document used to solicit proposals from prospective sellers of products or services. In some application areas, it may have a more specific meaning. (appropriate for high dollar, non-standard items).
Request for Quotation (RFQ)
PMBOK does not distinguish between RFQ and RFP. However, PMBOK does recognize that some application areas have a more specific meaning for RFQ (appropriate for low dollar items such as supplies and materials).
Statement of Work (SOW)
Describes the portion of the product to be contracted. In general, this is different from the product description (which tends to be more broader). Under the circumstance where the seller is producing the entire product, the distinction between SOW and the product description becomes moot. Government terms: SOW is reserved for a procurement item that is a clearly specified product or service, and Statement of Requirements (SOR) is used for procuring an item that is presented as a problem to be solved.

Procurement Management Processes

Procurement Planning

Solicitation Planning


Source Selection

Contract Administration

Contract Closeout

Procurement Management Concepts

Contract Origination

Two ways in which a contract can originate: unilaterally or bilaterally

Contract Types

Principal Types

Unit Price

Cost-Plus-Award-Fee (CPAF): (from the Frame Book)

The following contracts are ordered in increasing risk to the seller and decreasing risk to the buyer.

Cost-Plus-Percentage of Cost (CPPC)

Cost-Plus-Fixed Fee (CPFF)

Cost-Plus-Incentive Fee (CPIF)

Fixed Price-Plus-Incentive Fee (FPI)

Firm-Fixed Price (FFP)

Examples of Contract Types

Contract Execution Special Considerations

Sample Questions

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There are 89 questions related to the project procurement management. Simply click the 'All Questions' link in order to go to them.

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Following is a list of the questions and the general subject of the question. Click the number in order to go directly to that question.

[1] Contract Types
[2] Procurement Planning Processes
[3] Subcontractors
[4] Procurement Planning Processes
[5] Procurement Documentation
[6] Procurement Data
[7] Evaluation Criteria
[8] Source Selection Process
[9] Estimating
[10] Indirect Costs
[11] Contract Types
[12] Contract Types
[13] CPPC Contract
[14] CPIF Contract
[15] FPI Contract
[16] Subcontracting
[17] Bilateral Contracts
[18] Purchase Order
[19] Meetings
[20] Warranties
[21] Procurement Management Processes
[22] Purchasing Cycle
[23] Contract Terms
[24] Terminology
[25] Contract Management
[26] Contract Management
[27] Terminology
[28] Terminology
[29] Procurement Management Processes
[30] Documentation
[31] Bid Evaluation Process
[32] Make / Buy Decision
[33] Government Procurement
[34] Purchasing Operation
[35] Terminology
[36] Terminology
[37] Contract Types
[38] Contract Types
[39] Contract Types
[40] Terminology
[41] Contracting
[42] Contracting
[43] RFP
[44] Contract Negotiations
[45] Bid Package
[46] Award Phase
[47] Fast-Tracking
[48] Contractor Selection
[49] Contract Types
[50] Contract Types
[51] Contract Documentation
[52] Contract Types
[53] Contract Types
[54] Contract Writing
[55] Purchase Order
[56] Market Conditions
[57] Contracting Process
[58] Make / Buy Decision
[59] Terminology
[60] Changing Contract
[61] Changing Contract
[62] Warranties
[63] Warranties
[64] Purchase Order
[65] Contract Clauses
[66] Performance Bonds
[67] Payment Bonds
[68] Contracting
[69] Contract Delivery
[70] Project Manager's Time
[71] Close-out Phase
[72] Contract Provisions
[73] Contract Language
[74] Subcontractor Performance
[75] Contract Types
[76] Contract Types
[77] Proposal and Bidding Phase
[78] Contract Types
[79] Contracting
[80] Contractor Screening
[81] Invitations for Bid
[82] Proposal Submission
[83] Contractor Selection
[84] Terminology
[85] Proposal Preparation
[86] Proposal Preparation
[87] Contracting Knowledge
[88] Contracting Knowledge
[89] Contracting Knowledge


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Other Knowledge Areas
Integration] [Scope] [Time] [Cost] [Quality] [Human Resources] [Communications] [Risk] [Procurement]