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Procurement

About: Procurement is a research topic. Over the lifetime, 25669 publications have been published within this topic receiving 334145 citations.


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Journal ArticleDOI
TL;DR: This work model a firm that procures an input commodity and has processing capacity to convert the input into a processed commodity, and finds that the optimal procurement and processing decisions are governed by price-dependent inventory thresholds.
Abstract: We consider the integrated optimization problem of procurement, processing, and trade of commodities in a multiperiod setting. Motivated by the operations of a prominent commodity processing firm, we model a firm that procures an input commodity and has processing capacity to convert the input into a processed commodity. The processed commodity is sold using forward contracts, while the input itself can be traded at the end of the horizon. We solve this problem optimally and derive closed-form expressions for the marginal value of input and output inventory. We find that the optimal procurement and processing decisions are governed by price-dependent inventory thresholds. We use commodity markets data for the soybean complex to conduct numerical studies and find that approximating the joint price processes of multiple output commodities using a single, composite output product and using the approximate price process to determine procurement and processing decisions is near optimal. Compared to a myopic spread-option-based heuristic, the optimization-based dynamic programming policy provides significant benefits under conditions of tight processing capacities and high price volatilities. Finally, we propose an approximation procedure to compute heuristic policies and an upper bound to compare the heuristic against, when commodity prices follow multifactor processes.

95 citations

Journal ArticleDOI
TL;DR: In this paper, a list of 34 procurement selection parameters (PSPs) was drawn up according to the findings of researchers in procurement selection, and an empirical study was carried out in Australia with clients and project managers to unveil the importance and interrelationships of the identified PSPs.
Abstract: The lack of structured procedures, based on good information, for the selection of construction procurement system sometimes inhibits the opportunity for clients to choose a procurement option in a fully informed manner. The selection and use of an unsuitable procurement approach could eventually lead to project failure. To formalise the procurement selection procedures, clients should establish a set of appropriate procurement selection parameters (PSPs) based on their distinctive characteristics and objectives, project requirements, and external environment. In this paper, a list of 34 PSPs was drawn up according to the findings of researchers in procurement selection. An empirical study was carried out in Australia with clients and project managers to unveil the importance and interrelationships of the identified PSPs. The results indicate that the perception of clients and project managers on the importance of PSPs was generally consistent, that underlying relationships do exist among parameters, and there is a need for clients to ensure that the interrelated PSPs are not overlooked when assessing the suitability of construction procurement systems.

94 citations

Journal ArticleDOI
TL;DR: In this paper, an exploratory study and a series of interviews with clients, contractors and consultants involved in 11 Swedish construction projects, were performed in order to examine how risk management was carried out in each project.
Abstract: Before proceeding with a project, a client has to choose an appropriate procurement option that facilitates an effective project organization in general and a thorough risk management process in particular. By identifying three procurement variables that have a major influence on risk management: project delivery method, form of payment, and use of collaboration or partnering arrangements, the effect of each variable is studied. An exploratory study and a series of interviews with clients, contractors and consultants involved in 11 Swedish construction projects, were performed in order to examine how risk management was carried out in each project. Irrespective of the procurement option, many projects suffered from variations in cost affecting one or more actors. Risk management was not carried out systematically throughout project phases. However, in the projects with early involvement of the actors, their participation throughout the project, and opportunities for open dialogue and collaboration, a more...

94 citations

Journal ArticleDOI
TL;DR: In this paper, the authors discuss the development of a consistent and flexible framework for collecting whole life cost data for buildings and discuss the taxonomy of the cost breakdown structure, which will be of value to all the project team (designer, contractor, facilities manager, supplier, etc.).
Abstract: Whole life costing analysis is becoming much more important as long‐term building owners and clients start to demand evidence of what their costs of ownership will be. It is also becoming more important as more private companies invest in private finance initiative (PFI), public private partnership (PPP) and prime contracting (PC) projects. One of the main barriers to the successful implementation of whole life costing (WLC), is the lack of reliable and consistent data on elements of whole life cost (capital, facilities management, and disposal) and the performance of building elements and services. The objective of this paper is to discuss the development of a consistent and flexible framework for collecting whole life cost data for buildings. A description of the taxonomy of the cost breakdown structure is given. The proposed data structure will be of value to all the project team (designer, contractor, facilities manager, supplier, etc.) who might be involved in traditional procurement or PFI, PPP, and PC projects. When the cost data structure is populated, it will provide the foundation from which the whole life costs of different alternatives can be estimated and from which the risks such as the technical and financial risks related to WLC elements, operational risks, etc. associated with, PFI, PPP and PC projects can be assessed and minimised.

94 citations

Journal ArticleDOI
TL;DR: The survey delineates different representative scenarios in e-procurement where auctions can be deployed and describes the conceptual and mathematical aspects of different categories of procurement auctions, and presents the mathematical formulations under each of the above categories.
Abstract: Auction-based mechanisms are extremely relevant in modern day electronic procurement systems since they enable a promising way of automating negotiations with suppliers and achieve the ideal goals of procurement efficiency and cost minimization. This paper surveys recent research and current art in the area of auction-based mechanisms for e-procurement. The survey delineates different representative scenarios in e-procurement where auctions can be deployed and describes the conceptual and mathematical aspects of different categories of procurement auctions. We discuss three broad categories: 1) single-item auctions: auctions for procuring a single unit or multiple units of a single homogeneous type of item; 2) multi-item auctions: auctions for procuring a single unit or multiple units of multiple items; and 3) multiattribute auctions where the procurement decisions are based not only on costs but also on attributes, such as lead times, maintenance contracts, quality, etc. In our review, we present the mathematical formulations under each of the above categories, bring out the game theoretic and computational issues involved in solving the problems, and summarize the current art. We also present a significant case study of auction based e-procurement at General Motors.

94 citations


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Performance
Metrics
No. of papers in the topic in previous years
YearPapers
20231,696
20223,449
20211,142
20201,363
20191,503
20181,423