Scheduling as Part of the Project Management Effort - Construction Project Scheduling and Control - page 282

long before the start of the construction process and ends with project completion
or project closeout . The procurement team must work in close coordination with
both the estimating and scheduling teams, all under the project management team.
Depending on the company's functional hierarchy, the procurement manager or
department may or may not be under the project manager. In most large companies,
the PM is the highest authority within the project management team. Under this
person there are a construction manager, a procurement manager, a quality manager,
a safety manager, and so forth.
In management, project organization may be a pure project organization (in which
the team becomes autonomous, almost like an independent company), a functional
or departmental organization (in which everyone works under his or her functional
department in the main office), or a matrix organization (a combination of the preced-
ing two types of organizations, which leans more toward a pure project organization,
more toward a functional organization, or somewhere in the middle) 17 .
The two objectives of procurement, from the general contractor's viewpoint, are
as follows:
1. To hire the subcontractors who will actually erect and assemble the project : Doing
so can be accomplished through bidding or negotiation. Such hiring is also
subject to the contractual agreement between the general contractor and the
owner. The general contractor must know when each subcontractor's role
starts in the project. For this reason, the general contractor focuses on sub-
contracts on the critical path. Some subcontractors may not be hired until
after the project starts. Again, such hiring is subject to the agreement between
the owner and the general contractor.
2. To purchase the materials called for in the contract : This task may not be easy.
First, the procurement team must have a list of all of the needed materials,
along with their specifications, quantities, and dates of installation. Custom
and special orders as well as long-lead items must be given special attention.
Often, if an ordered material does not exactly match its description in the spec-
ifications, confusion will arise on the job site and decisions will have to be
made about what to do. Second, the procurement team must find the best
prices for the ordered materials. Finally, the procurement team must also bal-
ance between having a conservative attitude of buying the materials early and
storing them (the inventory buffer theory) and having a risky attitude of order-
ing the materials for installation when needed (the just-in-time theory). (Both
theories are discussed in Chapter 6.)
The purchasing cycle involves the estimating, scheduling, procurement, account-
ing, quality assurance, and perhaps other departments. The estimating department
17 Project Management: A Managerial Approach by Jack R. Meredith and Samuel J. Mantel Jr. (2008).