Control Procurements

Sensei Short Scroll 47 Monitoring & Controlling Process Group

Control Procurements

Introduction: Why This Matters

Selecting vendors and signing contracts is only the beginning. Contracts must be actively managed to ensure that vendors deliver according to agreements. The Control Procurements process ensures vendor performance is monitored, disputes are managed, and procurement obligations are fulfilled.

On the PMP exam, this process is often tested through situational questions about contract enforcement, performance reviews, claims administration, and closing procurements. In practice, strong procurement control prevents cost overruns, protects the relationship between buyer and seller, and ensures goods and services support project objectives (Project Management Institute, 2021).

Purpose and Objectives

Primary Purpose: To ensure procurement relationships are managed and contract performance stays aligned with agreed terms.

Key Objectives:

  • Monitor vendor performance against contract requirements.
  • Manage changes to contracts through formal procedures.
  • Handle disputes and claims fairly and consistently.
  • Validate invoices and authorize payments based on accepted work.
  • Close procurements when obligations are complete.
  • Update procurement documentation and capture lessons learned.

Overview

Control Procurements focuses on managing ongoing vendor relationships after contracts are signed. The project manager and procurement team compare actual performance against the contract, address changes and disputes, and formally close procurements when work is complete.

  • Monitor and measure: Use reports, KPIs, and audits to track vendor performance.
  • Control changes: Route all contract changes through formal change control.
  • Manage claims: Document and resolve disputes through defined procedures.
  • Validate payments and closure: Confirm deliverables, release payments, and close contracts formally.

Characteristics

  • Ongoing oversight: Runs throughout contract execution, not just at the end.
  • Evidence based: Relies on performance data, audits, and formal reports.
  • Procedure driven: Uses documented processes for changes, claims, reviews, and closure.
  • Risk and compliance focused: Protects the organization legally and financially by enforcing contract terms.

Inputs, Tools and Techniques, Outputs (ITTOs)

Inputs

  • Procurement management plan
  • Agreements (contracts, SLAs, purchase orders)
  • Procurement documentation (bid packages, proposals, vendor correspondence)
  • Approved change requests
  • Work performance data

Tools and Techniques

  • Data analysis: Performance reviews, earned value analysis, trend analysis.
  • Audits: Procurement audits to confirm compliance with contract terms.
  • Claims administration: Handling contested changes or disputes.
  • Performance reporting: Status reports, dashboards, scorecards.
  • Payment systems: Tools for validating invoices and releasing payments.
  • Interpersonal skills: Negotiation, conflict resolution, stakeholder engagement.

Outputs

  • Closed procurements
  • Work performance information
  • Procurement documentation updates
  • Change requests
  • Updates to project management plan and project documents
  • Organizational process asset updates

Contract Management in Practice

Key Activities:

  • Monitoring performance
    • Compare actual delivery to contract terms.
    • Use KPIs, dashboards, and performance reports.
  • Managing changes
    • Apply formal change control to contract modifications.
    • Document amendments and obtain approvals.
  • Claims administration
    • Handle disputes, often called “claims.”
    • Use negotiation, mediation, or arbitration.
    • Keep records for legal and contractual purposes.
  • Validating payments
    • Verify deliverables meet acceptance criteria.
    • Approve payments only for completed, acceptable work.
  • Closing procurements
    • Confirm obligations are fulfilled.
    • Document lessons learned and archive records.

Contract Enforcement and Claims

  • Constructive changes: Unofficial directions by the buyer that the seller interprets as a change. These must be documented and processed formally.
  • Claims: Disagreements on terms or scope that are resolved through negotiation, mediation, or legal action.

Practical Example: Software Development Outsourcing

Context: A company outsources development of a customer portal to an IT vendor.

Control Procurements activities:

  • Performance monitoring: Vendor dashboards reviewed weekly; defect rates tracked.
  • Change management: Vendor proposes additional reporting features; change request logged and reviewed.
  • Claims administration: Vendor disputes a penalty for late delivery, and negotiation resolves the claim.
  • Payment validation: Payments authorized after independent verification of deliverables.
  • Closure: Final audit confirms contract completion, and lessons learned are archived.

Outcome: Vendor delivers the product successfully, disputes are resolved without escalation, and procurement records provide a solid reference for future projects.

Common Pitfalls

Ignoring contract terms

  • Pitfall: Assuming verbal agreements are valid.
  • Prevention: Enforce only written, approved contract terms.

Weak performance tracking

  • Pitfall: Failing to monitor vendor progress.
  • Prevention: Use reports, audits, and KPIs regularly.

Improper handling of claims

  • Pitfall: Ignoring or informally resolving disputes.
  • Prevention: Document all claims and follow formal procedures.

Premature closure

  • Pitfall: Closing procurements before obligations are verified.
  • Prevention: Ensure all deliverables are accepted and obligations fulfilled before closure.

Sensei Tip : On the PMP exam, correct answers emphasize documenting claims and following formal resolution procedures, not informal side agreements or verbal understandings.

Exam Alert : A common trap is to ignore constructive changes or accept additional work without a formal change request. On the exam, you should always document the claim, route it through contract change control, and only enforce written, approved contract terms.

Exam Lens

Patterns on the PMP Exam:

  • Situational questions often involve disputes or extra work. The correct response is to document and follow the claims process, not rely on informal agreements.
  • Expect references to constructive changes. Correct handling is to treat them as formal change requests.
  • Closing procurements requires formal confirmation that work is complete and obligations are met.

Sample Question

Question: A vendor insists they were directed to perform additional work outside the contract scope. What should the project manager do?

  1. Approve payment since the work is already complete.
  2. Reject the vendor’s claim outright.
  3. Document the claim and follow contract change control procedures.
  4. Escalate immediately to legal counsel.

Correct Answer: C. Claims must be documented and handled through formal change and claims procedures before any payment or rejection decision is made.

Quick Recap Table

Concept Description Exam Watch Point
Control Procurements Manage vendor contracts and performance. Execution and closure aspects are tested frequently.
Claims Administration Formal process for handling disputes. Procedures must be documented, not informal.
Constructive Changes Informal directions treated as scope changes. Must be documented and approved through change control.
Closed Procurements Confirm obligations are fully met and records archived. Considered a key output of Control Procurements.

Key Takeaways

  • Control Procurements ensures vendors meet contractual obligations through monitoring, change control, and claims handling.
  • Key activities include performance tracking, managing changes, administering claims, validating payments, and closing contracts.
  • Outputs include closed procurements, change requests, and updates to plans, documents, and organizational assets.
  • On the PMP exam, correct answers emphasize formal, documented procedures over informal agreements.
  • In practice, strong procurement control safeguards relationships, compliance, and project success.

Next Step

With Control Procurements complete, the next process is Monitor Stakeholder Engagement, which ensures stakeholders remain appropriately involved and informed throughout the project.

Bibliography

Project Management Institute. (2021). A Guide to the Project Management Body of Knowledge (PMBOK® Guide) (7th ed.). Project Management Institute.

Scroll to Top