Table Of ContentIT_Procurement_Handbook_dw-USA:Layout 1 16/01/2009 10:33 Page 1
D
IT Procurement Handbook for SMEs a
v
i
d
David Nickson N
i
c
k
s
o
n
Large organisations can suffer badly when IT procurement Thinking about
goes wrong, but for small to medium enterprises (SMEs), it
upgrading? Avoid the
can be fatal. This handbook is specifically designed to help
SMEs manage that risk throughout the procurement process. IT pitfalls so many
Whether it is identifying the changing IT requirements of your
other SMEs fall into,
business, evaluating potential suppliers or managing them
and see how your
once appointed, this handbook will quickly guide you past
the dangers. business can reduce
its risk and exposure I
Identifying business requirements and risks T
The lifecycleof maintaining, refreshing, replacing and to financial ruin when P
r
decommissioning IT systems o
sourcing new IT
c
Hardware and software licensing
u
Evaluating suppliers and proposals products and services. r
e
What to look for in a contract m
Managing the tender process and negotiating e
n
with suppliers
t
Where to find help H
a
n
About the author
d
b
David Nickson has over twenty years’ experience in IT sales
o
and procurement covering a wide range of industries, with o
k
considerable expertise in the field of bid management. He
f
works with a variety of leading blue-chip companies, and o
r
writes on sales and procurement, as well as running his
S
own business. M
E
s
BUSINESS;
MANAGEMENT;
INFORMATION
TECHNOLOGY
This book is brought to you by the ISBN 978-1-902505-98-5
British Computer Society – the leading
professional and learned society in the field
of computers and information systems.
BCS FIRST FLOOR, BLOCK D,
NORTH STAR HOUSE, NORTH STAR AVENUE,
SWINDON, SN2 1FA, UK 9 781902 505985
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IT Procurement
Handbook for SMEs
Prelims 11/27/07 6:24 PM Page ii
The British Computer Society
BCS is the leading professional body for the IT industry. With members in over 100
countries, the BCS is the professional and learned Society in the field of computers
and information systems.
The BCS is responsible for setting standards for the IT profession. It is also leading
the change in public perception and appreciation of the economic and social
importance of professionally managed IT projects and programmes. In this
capacity, the Society advises, informs and persuades industry and government on
successful IT implementation.
IT is affecting every part of our lives and that is why the BCS is determined to
promote IT as the profession of the 21st century.
Joining BCS
BCS qualifications, products and services are designed with your career plans in
mind. We not only provide essential recognition through professional qualifica-
tions but also offer many other useful benefits to our members at every level.
BCS Membership demonstrates your commitment to professional development.
It helps to set you apart from other IT practitioners and provides industry recogni-
tion of your skills and experience. Employers and customers increasingly require
proof of professional qualifications and competence. Professional membership
confirms your competence and integrity and sets an independent standard that
people can trust. Professional Membership (MBCS) is the pathway to Chartered IT
Professional (CITP) Status.
www.bcs.org/membership
Further Information
Further information about BCS can be obtained from: The British Computer
Society, First Floor, Block D, North Star House, North Star Avenue, Swindon,
SN2 1FA, UK.
Telephone: 0845 300 4417 (UK only) or + 44 (0)1793 417 424 (overseas)
Email: [email protected]
Web: www.bcs.org
Prelims 11/27/07 6:24 PM Page iii
IT Procurement
Handbook
for SMEs
DAVID NICKSON
Prelims 11/27/07 6:24 PM Page iv
© 2007 David Nickson
The right of David Nickson to be identified as author of this Work has been asserted by him in accordance with
sections 77 and 78 of the Copyright, Designs and Patents Act 1988.
All rights reserved. Apart from any fair dealing for the purposes of research or private study, or criticism or review,
as permitted by the Copyright Designs and Patents Act 1988, no part of this publication may be reproduced, stored
or transmitted in any form or by any means, except with the prior permission in writing of the Publisher, or in the
case of reprographic reproduction, in accordance with the terms of the licences issued by the Copyright Licensing
Agency. Enquiries for permission to reproduce material outside those terms should be directed to the Publisher.
The British Computer Society
Publishing and Information Products
First Floor, Block D
North Star House
North Star Avenue
Swindon
SN2 1FA
UK
www.bcs.org
ISBN 978-1-902505-98-5
British Cataloguing in Publication Data.
A CIP catalogue record for this book is available at the British Library.
All trademarks, registered names etc. acknowledged in this publication are to be the property of their respective
owners.
Disclaimer:
The views expressed in this book are of the author(s) and do not necessarily reflect the views of the British Computer
Society except where explicitly stated as such.
Although every care has been taken by the authors and the British Computer Society in the preparation of the
publication, no warranty is given by the authors or the British Computer Society as Publisher as to the accuracy or
completeness of the information contained within it and neither the authors nor the British Computer Society shall
be responsible or liable for any loss or damage whatsoever arising by virtue of such information or any instructions
or advice contained within this publication or by any of the aforementioned.
Typeset by Lapiz Digital Services, Chennai, India.
Printed at .
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For my mother,Mrs C.V.Nickson.
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Contents
List of Figures and Tables xi
Author xv
Foreword xvii
Acknowledgements xix
Abbreviations xxi
Introduction 1
Who is this book for? 2
Why has it been written? 2
How it has been written? 2
What it does not include 3
How to use this book 3
1 The Procurement Lifecycle 6
Introduction 6
Lifecycle 6
Lifecycle case studies 12
Summary 18
2 Managing a Procurement 19
Introduction 19
Who do you need? 19
Why have a plan? 21
What to include in a procurement plan 22
SMART 24
How to document it 24
What to communicate 26
Change 26
Common problems 27
Warning signs 29
Sample plan for a small to medium procurement 30
The minimum 31
Summary 32
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Contents
3 Needs and Business Cases 33
Introduction 33
Cost of getting it wrong 33
Needs analysis 34
When to get help 37
Documenting your needs 38
Business case 44
What has changed? 45
Summary 45
4 Risk and Procurement 46
Introduction 46
Risk planning: what is in it for you? 46
Sources of risk 48
Procurement risks 49
IT-specific risks 50
Simple risk method 51
Sample risk plan 56
Summary 58
5 Bid Documentation 59
Introduction 59
Good advice 59
Requirements 60
Pre-qualification 65
ITT or ITN 65
BAFO 67
Contractual material 67
Correspondence 67
Presentations (to suppliers) 67
Electronic versus paper 68
Instructions to bidders and suppliers 69
Writing style and skills 70
Looking after it all 72
Summary 73
6 Bid Evaluation 74
Introduction 74
Approach 74
Criteria 75
Communication 82
Evaluating submissions 82
Final approval 88
Consumables and low-value items 88
Summary 89
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