Process Manual - Finalr1
Transcript of Process Manual - Finalr1
STANDARD OPERATING PROCEDURE
SDL-PD-01801 Rev 0
Page 1 of ____
Effective 1 Nov. 2008
PURCHASE OF GOODS, EQUIPMENTS & SERVICESManager - Purchase Manager – Systems & Process VP - Purchase
Revision History
S.No. Version Date Author Description
Distribution List
Purchase department- Assistant, Executive, Managers, GM, VP and ED. VP’s of all departments/ division.All ED’s.
1.0 Purpose
The purpose of this procedure is to provide an efficient, effective and consistent way of purchasing goods, equipment & services. This procedure defines the standard work processes regarding the purchasing of Site material including Manual and Electronic Site Material Requisitions (SMRs), Indirect Materials/Goods used on Multiple Projects. (IMMP’s). This document establishes the process of requisitioning, approving, ordering, and receiving goods, equipment & services as well as tracking orders throughout the entire purchasing cycle.
2.0 Scope
2.1 This procedure is applicable to all projects under the administrative control of Sobha Developers Ltd (SDL). It addresses the responsibilities and work process for the origination and issuance of the Site material requisitions to Site Procurement for purchase.
2.2 Requirements for (Sub) contractors performing activities as described in Section 1.0 of this procedure are found in Standard Work Process Procedure ________________, (Sub) contractor Requirements.
2.3 In accordance with SDL Operating Instruction (Ref. _______________) , Standard Work Process Procedures, any deviation from this procedure shall be documented and approved in advance by the responsible Vice President (VP) and the Project Manager in-charge of Site Procurement.
2.4 This procedure is applicable to all domestic and International purchases of goods made under the administrative control of Sobha Developers Limited (SDL)
3.0 Definitions
3.1 Site Material Requisition (SMR)
An application located in Sobha Purchase Module (SPM), ERP based or a manual document used by Site Project Managers or Engineers to electronically or manually generate SMRs to request equipment, materials or services required for purchase, rental or subcontracting, during the construction of the project.
3.2 Direct Plant, Material and Services
Plant, Materials and/or services used as part of the permanent facilities or having a direct impact on the quality of completed work and/or Site services.
3.3 Indirect Plant, Material and Services
Materials and services used during construction, which do not become a part of the facility or plant or do not have a direct impact on the quality of completed work and/or site services. (i.e., temporary facilities, construction equipment, grinding wheels, files, safety tape, etc.).
3.4 Sobha Purchase Module (SPM) ERP based
Sobha's integrated supply chain and materials management system for Real Estate Development Projects and Contract projects. It spans from materials requirements planning through issue of materials to construction in the field. It is designed for use throughout the life of a project for both office and site procurement of engineered equipment, materials and services. Functions include requisitioning, purchasing, construction rentals, receiving, expediting, traffic & logistics, inventory control, and management of bulk and tagged components on a project. It links to engineering design/specification systems, document management, various supplier's systems, cost control and accounts payable.
3.5 Material Assignment Schedule (MAS)
A schedule that identifies the Plant/equipment, material and services required for the project, and the Sobha department responsible for developing the appropriate material requisitions.
3.6 Indirect Material/Goods used on Company wide Project Acquisition Group (CWPAG)
CWPAG is responsible for the formation, administration and coordination of Construction CWPA’s including items such as concrete formwork and shoring, scaffold, drilled-in anchors, safety supplies/equipment, consumables, small tools and temporary office facilities. The CWPAG has responsibility to administrate and coordinate such CWPA’s. However, VP (Projects / Contracts) has the clear responsibility to manage the supply, release, and budget adherence for any quantity on a jobsite that is obtained from such a purchase agreement.
3.7 Company wide Project Agreements (CWPA)
Agreements negotiated and administered by CWPAG personnel. Pricing or pricing formulas for materials and services covered by these agreements are established in the CWPA. Site procurement will execute blanket orders with not-to-exceed values, imposing the terms and conditions of the applicable CWPA. Refer SDL Policy (Ref. _____) and Procurement Instructions (ref ___) for appropriate use on specific projects.
3.8 Trend
An item of change to the project scope, pricing, unit rates, schedule, or intended plant quality that causes an addition or reduction to the trend base estimate including corrections for scope/estimate omissions.
4.0 References
4.1 SDL Operating Instruction (Ref_________), Standard Work Operating Procedures4.2 Standard Operating Procedure (Ref. ____) , (Sub)contractor Requirements4.3 Standard Operating Procedure (Ref. ________), Materials Receiving4.4 Sobha Corporate Policy , Procurement of Goods and Services4.5 Site Manual, chapter # , Purchasing4.6 General Financial Rules, SDL. 4.7 Rules and Regulations and Bye-Laws of SDL. 4.8 Schedule of Powers vested in various authorities / Staff of SDL
5.0 Method of Delivery
5.1 Purchase process
Procurement of stores through indigenous and foreign sources as required in accordance with the rules in force.
1. Preparing requisitions/ purchase indents.2. Checking of requisitions/purchase indents. 3. Selection of suppliers for issue of enquiries. 4. Issuing enquiries/tenders and obtaining quotations. 5. Analysing quotations and bids etc., and preparation of comparative statement
(quotation charts).6. Consultation with the Indentor for selection and approval of quotations and with
Accounts Officer for pre-audit. 7. Negotiating contracts. 8. Checking legal conditions of contracts. Consulting legal Officer. 9. Issue of Purchase Order. 10. Follow-up of purchase orders for delivery in due time.11. Verification and passing of suppliers’ bills to see that payments are made
promptly. 12. Correspondence and dealing with suppliers, carriers etc., regarding shortages,
rejections etc., reported by the Stores Department. 13. Maintenance of purchase records. 14. Maintenance of progressive expenditure statement, sub-head wise. 15. Maintenance of vendor performance records/data. 16. Arrangement for Insurance Surveys, as and when necessary. 17. Clearance of foreign consignments. 18. Keeping various Departments/Divisions informed of the progress of their
indents in case of delay in obtaining supplies. 19. Serving as an information center on the materials’ knowledge i.e. their prices,
source of supply, specification and other allied matters. 20. Development of reliable and alternate sources of supply. 21. It shall be particularly ensured:
i. that all purchase are made against properly authorized requisitions, and valid sanctions, showing the correct and detailed end-use.
ii. that all the materials requisitioned are duly ordered from the right source after full enquiries on most competitive price taking into account the trade discounts and tax benefits etc.
iii. that the right quantity of the goods consistent with the quality and the specification required is bought.
iv. that the deliveries of all goods are received within the stipulated period. v. that claims due to shortages or any other discrepancies are settled promptly. vi. that cordial and harmonious relations with all sections/divisions are
maintained for becoming an efficient service unit.
22. While receiving the planned requirement of the indentors, it should be prevailed upon the Indentors to certify clearly that the quantities indicated are definitely required for the project and specify the period within which the quantities indented will be consumed. It is the duty of the purchase section to check purchase indents against needs and suggest modification of quantities wherever necessary.
5.2 Process flow chart
STANDARD WORK PROCESS FOR FIELD MATERIAL REQUISITIONS AND PURCHASING
5.3 Requirements 5.4 Attachments
Assistant-Purchase(Nisha)
GM-Purchase
SDL & SGML(J.M.
Srinath)
Dy. Mgr. (Electrical)
(V.P. Ramesh
Mgr.Purchase
(Anil Thampan)
Dy.Manager Pur Santosh, Pandu, Naveen
Asst. Manager (Mallikarjun)
Mgr. Granite & Marble
(Utthaman VS)
Assistant(Rajesh
K.T)
AGM Purchase (Vishwanath.R)
Coordinating Cell
(P.G. SrinivasC.S. Mahesh) Manager SGML
(Pratish Babu)
Sr. Executive
Tilak Pur. Exe
Executive, Tiles & Plumbing items
(R.Ramesh)
Executive Purchase
Executive, PurchaseReshmaReddy
Executive, Purchase
(Archana Deshpande)
Jr. Executive Purchase(Anand S.)Jayaprakash
Sr. executive Power toolsExecutive
Power tools
Executive, PurChennai & Trivendrum
Sr. Exe Pur Bhuvaneshwar
VP-Purchase (Srikanth Kulkarni)
Asst Manager Chandigarh
5.5 Organization chart
5.6 Responsibility matrix
Process /Activity Responsibility Support
Vendor Selection
Checking the prequalification documents.
Visiting the factory / shop if required to evaluate the capacity / capabilities.
Vendor rating and approval Approval of trial order Procurement of materials at
right price, right time and right quality.
VP/ AGM / Manager
Procurement of materials and services as per the user’s requirements
Floating the enquiries to the vendor
Negotiating the best price and checking all the technical specifications.
Finalizing the purchase order /work order.
Executive & Executive coordinating cell
Prompt payment to the Suppliers
Coordinating with the project site for the GRIR to be entered in the ERP for the prompt payment to the suppliers.
Executive coordinating cell / Assistant
Vendor performance evaluation and review.
Vendor performance is evaluated on a quarterly basis.
Checking the Vendor evaluation rating received from the site.
Taking appropriate measures to improve the performance of vendor rating if required.
AGM/Manager
Vendor development
Locating and developing new vendors on monthly basis considering all cost reducing measures.
AGM/Manager
Scrap Disposal
Coordinating with the project stores to have the Updation of the scrap book.
Floating enquires to the vendors for the quotation.
Negotiation with the vendors for the best price.
Giving output to site to finalize the order
AGM/Manager
6.0 Interdepartmental Relationships – receivables and deliverables
Sr. DEPARTMENT INPUT (TO PURCHASE DEPT) OUTPUT (FROM PURCHASE DEPT)
01 MARKETING, SALES & CRM
Requirement of advertisement materials / gifts / hoardings.
Agency details etc. printing of brochure, banners etc.
Request and detailed information about Advertising agencies.
Requisition of maintenance materials during maintenance period.
Procurement of materials, issuing purchase order.
Work orders / annual contracts on agencies etc. for media advt. and printing of brochure, banners etc.
02 PROJECT
Indents for materials (PRs), Pending PRs / Materials list.
Feedback on vendors regarding the quality of the materials supplied at site.
Time schedule/ Execution Schedule. Technical inputs on materials when requested. Requisition for Work Order on
Subcontractors. Feedback on subcontractor performance. Information regarding rejected materials. Information regarding Capital Budget. Fixed assets. Verbal orders in case to be regularized.
Purchase Orders for materials indented. Lead-time Requirement. Status of PRs / Materials. Procurement schedule. Information regarding prices/ availability of
materials. Work contract finalization. Replacement of rejected materials as per the
standards one. Planning for the Inventory. Coordination on the technical feedback on
recommending fixed assets. Verbal orders are not encouraged.
03 ESTIMATION
Request for updated prices list of all materials on monthly basis.
Detailed estimates for all ongoing and forthcoming projects.
To ensure that sufficient quantity of materials has been incorporated in estimate for the respective month.
Copies of Purchase Orders/Work Orders as and when required.
Basic price list of all the materials including Tax structures etc.
Intimation of variations in Quantity. Monitoring of the rates considered in estimate
depending upon market fluctuations. 04 M&E Indenting the purchase requisition with material
specification and material delivery schedule. Follow up with purchase dept for timely delivery of
Placing of PO’s for indented materials. Providing all rates, discount structure & tax
structure for all the materials as and when
Sr. DEPARTMENT INPUT (TO PURCHASE DEPT) OUTPUT (FROM PURCHASE DEPT)
materials. Intimating to purchase dept in case of any changes
in the PR. Technical inputs on material on request.
required. Lead time, procurement schedule and status of
PR's / Material. Feed back for material delivery as and when
required. Information regarding prices / availability of
materials.
05HUMAN RESOURCE
Offer letters/ Appointment orders Confirmation letters Promotion letters Increment letters Commendation letters Rewards and incentives Training to meet identified needs. Preparation of key performance and performance
based appraisal
Staff Appraisals Human Resources Requirements Staff Training needs / Requirements Prompt closure of Quarterly manpower
requirements.
06 ARCHITECTURE
Request for samples along with rates. Approved drawing copies of MS Works. Recommendation for new products introduction.
Provide samples with rates for approval Providing technical details for the recommended
products and getting approval of the same.
07CHAIRMAN’S OFFICE
Inputs regarding strategy / vision Approvals for procurement of certain special items. Feedback on vendors Instructions to close pending purchase related
issues Capital budget
Monthly statement and status of affairs. Fortnightly Activity reports. Things to do once a fortnight to Chairman's
Office. Planning for inventory MIS reports Information regarding newly developed vendors
and products Innovative ideas.
08 MD's OFFICE Key inputs on long term rate contracts, business scenario & any relevant information.
Efficiency of the department
Provide status of procurement of key materials
Provide information on the changes in the market scenario / key developments from the
Sr. DEPARTMENT INPUT (TO PURCHASE DEPT) OUTPUT (FROM PURCHASE DEPT)
viewpoint of materials MIS reports Updating the department functions promptly Sanction / approval for capital items of high
value (key materials)
09FINANCE / ACCOUNTS DEPT
List of sundry creditors. List of pending GRIRs / POs / Invoices. Cheques to be issued to suppliers Reconciliation and rejected materials details. Information regarding PF / ESI / TDS / PAN Information regarding new rules and regulation
w.r.t. VAT/ ED / Service; tax / Customs.
GRIRs + invoice from suppliers for payment processing.
Statement of accounts from suppliers for reconciliation of payments.
Statement of Pending Payments. Vendor Tax registration details through ERP. Short closing of rejected and un replaced
materials purchase order. Information on vendors (Small scale / medium
scale etc)
10 R&D
Suggestions regarding economically and technically superior substitutes for material currently in use.
Licensing or certification of the Quality of products.
Compliance of requisition material. Sample and the specified details of the new
product to be introduced.
11 CORPORATE AUDIT
Audit Observations / Recommendations. Suggestions to improve the purchase order terms.
Compliance with audit recommendations
12 ADMIN
Arrangement of traveling / communication facilities. Arranging accommodation. Office stationery requirement. Providing proper security arrangements.
Request for Office stationery Printing Mobile and Land Telephones Office equipments Conveyance Ticketing Security arrangement Any other requirements within the
Administrative purview.13 QUANTITY Certification of rates / terms & conditions for Work order copies for vetting
Sr. DEPARTMENT INPUT (TO PURCHASE DEPT) OUTPUT (FROM PURCHASE DEPT)
AUDIT
work orders Certification of running bills for payments as per
work order terms and standard measurement terms
Clarification of rates To ensure that measurement can be done as
per the standard terms Monitoring that any reduction in vendor
payment and deduction in quantity, should be informed to Project / Purchase.
7.0 Evaluation methods7.1 Metrics
The following metrics have been defined.
1. Timely Procurement of ‘A’,’B’ and ‘C’ Class Items.
Metric: No. of items ordered
No. of items requisitioned in PR
2. Cost saving metric
Metric: Actual cost savings achieved during a quarter
Targeted cost savings.
3. * Vendor Performance Metric
Metric: No. of items delivered within time frame specified in P.O.
No. of total items ordered (A Class items)
* Rates and quality are taken into consideration prior to placing the order.
4. Vendor development metric
Metric: No. of new vendors developed
Planned number of vendors to be developed.
Targets will be set for the metrics. Performance will be reviewed periodically against
target and improvement actions will be initiated. Targets will be renewed annually.
8.0 Reporting systems( MIS) & Document control
8.1 Forms
The following formats are used by the department.
Sl. No. Annexure Particulars 1 I Comparison Chart
2 II Enquiry
3 III Checklist
4 IV Purchase request
5 V Purchase Order
6 VI Work Order
7 VII Vendor Pre – Qualification Form
8 VIII Vendor Rating Evaluation
9 IX Sub Contractor Performance Evaluation
10 X MIS Report
8.2 MIS8.3 Document records & filing
The following documents and records are maintained by the department. The
retention period of the documents and records are also mentioned.
S. No NAME OF THE RECORD RETENTION PERIOD
1 Purchase Requisitions 2 years
2 Comparison chart 2 years
3 Purchase order 2 years
4 Work order 2 years
5 Import purchase order 3 years
6 Minutes of meeting 2 years
7 Internal audit reports 3 years
8 Vendor Pre-Qualification 2 years
9 Vendor performance evaluation 2 years
10 Sub contractor performance evaluation 2 years
11 MIS Report 3 years
S. No NAME OF THE DOCUMENT RETENTION PERIOD
1 Internal documents. Permanent
2 General Procedures Manual. Permanent
3 Quality Assurance Manual Permanent
4 Updated price list of key items. Permanent
5 Directory of materials and products. Permanent
6 List of approved suppliers. Permanent
9.0 Other Requirements9.1 Strategy & Budgets9.2 Human resources & job role9.3 Space9.4 Infrastructure9.5 Tools/Software/ Technology used
10.0 Training methods
1.1 TRAINING PROGRAMME FOR NEW COMERS ORIENTATION
If a new employee in the Purchase Department joins without any previous training and experience and all his practical training has to be acquired on the job, he shall be given a week’s orientation i.e. an understanding of the jobs in terms of its own activities, objectives and responsibilities in relation to the museum’s policies and operations. For that purpose, his course of training shall consist of the following:
(a) Knowledge of purchasing principles, policies and procedures. (b) Knowledge of relevant rules from SDL– Sobha Purchase Manual(SPM)
etc. (c ) Knowledge of SDL’s developmental activities, equipment or productions,
if any. (d) Knowledge of materials and how they are used. (e) Knowledge of other departments and their work, and the Purchase
Department’s relationship with them and how they coordinate and help each other.
The above training shall be acquired under the guidance and supervision of the Manager- PMD and its progress shall be watched by him till its completion. The trainee shall undergo a simple test at the end of his week’s training. Its evaluation/rating shall go into his personal records. Similar training shall also be imparted on the incumbents joining Stores Department without any previous training and experience.
1.1 TRAINING PROGRAMME FOR SDL STAFF
10.1
11.0 Time lines
VARIOUS STAGES AND PROCESSING TIME FOR INDIGENOUS PURCHASE
Following are the various stages in the procurement of stores from indigenous sources along with optimum processing time:
1 Indent/requisition for purchase of stores from Division/Projects/Stores Officer
2 Notice inviting tenders/enquiries 1 to 3 days
3 Opening of tenders/quotations 7 to 14 days
4 Scrutiny of tenders/quotations and tabulation of comparative statement thereof
1 to 3 days
5 Selection of material by indentor 1 to 3 days
6 Pre-audit of purchase proposals by Finance 1 to 3 days
7 Formal sanction by competent authority 1 to 2 days
8 Placement of order 1 to 2 days
9 Delivery time *
10 Clearance from Railways, Road, Transport Companies, postal authorities, Airlines etc.
1 to 3 days
11 Passing and payment of bills (see item 17) 8 to 15 days 22 to 48 days
Plus delivery time
*Note: Minimum time for getting a material in store is 15 days from the receipt of indent in purchase section. It may take longer time if the indent is a long one with many items and/or if delivery time taken by supplier is long.
12.0PROCEDURE OF PURCHASE AND SANCTIONING AUTHORITY
Amount of Purchase Procedure Sanctioning Authority
Up to Rs.250 Cash purchase Project EngineerRs.251-500 Cash purchase as a very special
case after recording reasons for urgency
Project Engineer
Rs.501-1000 On the basis of lowest quotation out of at least 3 quotations
Project Manager
Rs.1001-10000 On the basis of lowest quotation out of at least 3 quotations
Such staff who are au-thorized by VP to accord sanction upto Rs.10,000/-
Rs.10001-20000 On the basis of lowest tender out of at least 3 tenders (limited tender)
VP - PMD
Rs.20001-50000 On the basis of lowest tender out of at least 3 tenders invited on open
VP- PMD
tender basis through press advertisement
Above Rs.50000 Refer to Executive Committee -
Note: All purchase shall be effected only after obtaining prior sanction from the competent authority. Proposals for ex-post-facto sanction shall not be admitted without VP-PMD’s approval.
13.0 Document References
13.1 Handbook of Import and Export procedures, orders issued by Government of India from time to time.
13.2 Rate and Running Contracts entered into by SDL from time to time. 13.3 India Trade Journal. 13.4 Hand-book of commercial firms. 13.5 Catalogues of foreign and indigenous manufacturers etc. 13.6 Books on materials management, Inventory Control by famous authors 13.7 Railway Goods Tariff, Terminal Tax, Sales Tax, Octroi and custom rules. 13.8 Directory of foreign and indigenous manufacturers. 13.9 Periodicals that report new concepts and techniques in Managing, Purchasing
and material activities.
14.0 Affected / Related Procedures 15.016.017.0
Method of Delivery
Procurement of stores through indigenous and foreign sources as required in accordance with the rules in force.
23.Preparing requisitions/ purchase indents.24.Checking of requisitions/purchase indents. 25.Selection of suppliers for issue of enquiries. 26. Issuing enquiries/tenders and obtaining quotations. 27.Analysing quotations and bids etc., and preparation of comparative
statement (quotation charts). 28.Consultation with the Indentor for selection and approval of quotations
and with Accounts Officer for pre-audit. 29.Negotiating contracts. 30.Checking legal conditions of contracts. Consulting legal Officer. 31. Issue of Purchase Order.32.Follow-up of purchase orders for delivery in due time.33.Verification and passing of suppliers’ bills to see that payments are
made promptly. 34.Correspondence and dealing with suppliers, carriers etc., regarding
shortages, rejections etc., reported by the Stores Department. 35. Maintenance of purchase records. 36.Maintenance of progressive expenditure statement, sub-head wise. 37. Maintenance of vendor performance records/data. 38.Arrangement for Insurance Surveys, as and when necessary. 39.Clearance of foreign consignments.
40.Keeping various Departments/Divisions informed of the progress of their indents in case of delay in obtaining supplies.
41.Serving as an information center on the materials’ knowledge i.e. their prices, source of supply, specification and other allied matters.
42. Development of reliable and alternate sources of supply. 43. It shall be particularly ensured:
a. that all purchase are made against properly authorized requisitions, and valid sanctions, showing the correct and detailed end-use.
b. that all the materials requisitioned are duly ordered from the right source after full enquiries on most competitive price taking into account the trade discounts and tax benefits etc.
c. that the right quantity of the goods consistent with the quality and the specification required is bought.
d. that the deliveries of all goods are received within the stipulated period.
e. that claims due to shortages or any other discrepancies are settled promptly.
f. that cordial and harmonious relations with all sections/divisions are maintained for becoming an efficient service unit in the museum/center.
44.While receiving the planned requirement of the indentors, it should be prevailed upon the Indentors to certify clearly that the quantities indicated are definitely required for the project and specify the period within which the quantities indented will be consumed. It is the duty of the purchase section to check purchase indents against needs and suggest modification of quantities wherever necessary.
Time Lines
6. VARIOUS STAGES AND PROCESSING TIME FOR INDIGENOUS PURCHASE6.1 Following are the various stages in the procurement of stores from indigenous sources
along with optimum processing time:
6.1.1 Indent/requisition for purchase of stores from Division/Projects/Stores Officer
6.1.2 Notice inviting tenders/enquiries 1 to 3 days
6.1.3 Opening of tenders/quotations 7 to 14 days
6.1.4 Scrutiny of tenders/quotations and tabulation of comparative statement thereof
1 to 3 days
6.1.5 Selection of material by indentor 1 to 3 days
6.1.6 Pre-audit of purchase proposals by Finance 1 to 3 days
6.1.7 Formal sanction by competent authority 1 to 2 days
6.1.8 Placement of order 1 to 2 days
6.1.9 Delivery time *
6.1.10 Clearance from Railways, Road, Transport Companies, postal authorities, Airlines etc.
1 to 3 days
6.1.11 Passing and payment of bills (see item 17) 8 to 15 days 22 to 48 days
Plus delivery time
*Note: Minimum time for getting a material in store is 15 days from the receipt of indent in purchase section. It may take longer time if the indent is a long one with many items and/or if delivery time taken by supplier is long.