Procurement can be defined as a deliberate process organized and implemented to facilitate the acquisition of goods, facilities and services from an external supplier or source. Procurement activities are often directed by a procurement manager who is charged with the responsibility of seeking favorable services and equipment required for facilitating the attainment of a certain desirable goal; thus the process has to be handled with due transparency so as to ascertain the costs, quantity and the quality of the goods or facilities being purchased (Baily & Crocker 9). In the context of the e-health system for the Ontario Province, it is required that a procurement and cost forecasting outline that will integrate the current system to the electronic health system be procured. First of all is the reality that the procurement manager has to state the pertinent departments and areas where these facilities will be required before the general procurement outline is made.
First, the system necessitates the acquisition of 1000 new kiosks that will be installed at strategic locations in the Ontario Province. Preferably the most idea places would be on the foyers belonging to major hospitals, shopping malls in the metropolitan sections of Toronto, and office building. The kiosks have to be fitted with electronic gadgets interoperable with customized portals belonging to the Ministry of Health. This insinuates that the system will require both computer hardware and software for example servers, routers, internet switches and computer systems. These facilities will enable the kiosks in different locations to be fully networked from a central headquarter computer via the Ontario Health System Network. It is this software programs that will enable the clients and customers to open personalized and private medical accounts which can be accessed through the systems internet portal using the OHIP numbers issued to customers after registration with the system (Welle 18).
Given the fact that the procurement process for the Ontario Health System will be made for the Ontario residents, it is categorized as a public project which necessitates accountability in the procurement process so as to promote an open and fair acquisition of the various system facilities and kiosks mentioned in the preceding chapter. The second objective for indulging in fair procurement exercise is to minimize the possibility of collusion and fraud (Karen 44). Therefore, the main decisions to be made have to involve decision making that seek to economize on the use of resources, gain marginal benefits, efficient handling and delivery of the services and avoidance of price fluctuations. In order to attain these objectives, information is pertinent in helping facilitate the economic analysis of the Ontario metropolitan province. Among the analyses, would include the cost-benefit analysis.
Timetable showing details on the steps and time frame for implementation of the procurement process.
|Preparing a RFQ||(2 Weeks)|
|Bidding Process||(4 weeks)|
|Selecting a tenderer||(1 week)|
|Delivery Date/ Purchasing other items||(4 weeks)|
|Connecting required wiring systems||(1week)|
|Installing proper software||(1week)|
RFQ is an abbreviation for Request for Quote, which is done when a procurement manager wants to collect information on what the vendors have to offer for the different facilities, goods and services required for the implementation of the Ontario e-health project. The manager should make RFQs by considering the proximity of the locations of the kiosks and the vendors so as to save on the transportation costs. On the other hand, RFP is an initial for Request for Proposal, which is used when the manager knows that the project has a problem, but the procurement manager lacks sufficient information to sort the issue at hand. The RFPs are formal thus they follow a strict format in terms of content, vendor response and timeline. Additionally the procurement managers may make Request for Information that is abbreviated as RFIs and can be used to seek for elaborate information during the implementation of the Ontario e-health project. The main factors to consider while making the RFPs and the RFIs is the availability of resources such as capital. The information provided by the vendors or suppliers should thus be limited to budget made by the Ontario Health Department (Ellis 32).
Forecasting is a process that entails making of financial statements with projections on the expected expenditures. The actual outcome of cost projection is the formation of an outline with variables that support the procurement forecasting process and timeline. In the case of the Ontario e-health system, cost forecasting will involve listing down all the elements quotes in the RFQs, RFIs and RFPs so as to gain a standardized projection of the project costs. After the comparison of the prices for setting up the 1000 kiosks, furnishing and installing all the hardware and software equipment, statistical methods can then be employed by use of time series analysis, cross-sectional data, as well as longitudinal data (Karen 41). Alternatively the procurement manager might decide to use less formal projections such as judgmental with the aid of the accounting and finance department. The degree of project risk, such as the risks involved in integrating the e-health system with the traditional systems, the data information to be transferred, and the cost of creating public awareness are fairly high. The degree of risks to be involved in installing the servers and other components in the kiosks should be factored into the cost forecasts so as to reduce the chances of uncertainty and under budgeting that might lead to stalling of the project.
Likewise, cost forecasting needs to factor in international vendors that result into exchange rate risks. For instance, the exchange rate between the US and the Canadian dollar might lead to delays and increased costs of procuring the desired equipment and services. The procurement manager might decide to use external contractors or suppliers because of their low price quotations but when exchange rate adjustments are made, the costs incurred would equate that of the local or domestic suppliers thus such factors have to be considered in the cost forecasting. By so doing, the management can decide on the use of Electronic Data Interchange or the EDI system which is an electronic procurement system that facilitates the interaction of the Ontario e-health project managers and the vendors (Shaw 34). The EDI system has been lauded for creating a cost effective platform where the Ontario province can save costs that could be incurred on informational exchange between vendors and the management. Alternatively, the online market place system can be used to save on the costs that could be incurred on intermediaries and brokers who might increase the costs of setting up the Ontario e-health project.
Integrated change control can be defined as a tool for project management which is used to estimate and manage the possible impact that can be accrued from change of certain factors during the implementation of the project. In the given scenario of the Ontario e-health systems, automation of basic health services could trigger the institution of a Work Breakdown Structure also known as the WBS. The integrated change control process for the Ontario e-health project can only be instigated when the project manager asks the vendors, suppliers, engineers or the employees to write down a formal document making a written proposal in the form of a request on the possible changes that can enhance the suitability of the health automation project, the possible costs and variations from the original project and the possible drawbacks for change. The changes can then be documented after being approved by the configurative management tool. After approval, the changes can then be updated into the original project, other pertinent factors such as the WBS, risk plan, insurance plans and communication plans will be re-adjusted after which the project can be implemented fully (Weele 14).
Baily, Farmer & Crocker, Jessop. Procurement-Principles and Management, Baxter: New Raven Press, 2008. Print.
Ellis, Kimberly. Production Planning and Inventory Control. New York: McGraw-Hill, 2010.
Karen Clark. A guide to the project management book of knowledge, 4th ed. Newtown Square, PA: Project Management Institute, 2008. Print.
Shaw, Felecia. The Power to Procure: A Look inside the City of Austin Procurement Program. Applied Research Projects, Texas State University-San Marcos, 2010.
Weele, Arjan. Purchasing and Supply Chain Management: Analysis, Strategy, Planning and Practice (5th Ed.). Andover: Cengage Learning, 2010.