introductory note negotiation iif contracts

7/28/2019 Introductory Note Negotiation Iif Contracts

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Introductory Note for the completion of Contract Preparation Forms(CPFs) for

Incoming International Fellowships (IIF)

This note is intended to provide, in plain English, some guidance for the completion of CPFs.They are based on the experience of the last two years of contract negotiations for MarieCurie Individual fellowships. Many of you will be aware that there have sometimes beensignificant delays in the negotiation process and contract production but this can usually betraced back to some data in the CPF that was wrong (or even not filled in at all) or asupporting document that was not supplied.

It is important therefore to take a few minutes to read this guidance and in particular to provide all of the documents specified in the check list when returning the CPF.

Please note that the Commission services can only provide funding based on the informationyou provide and on the legal basis (that is the relevant Work Programme). If data is notcorrect in the CPF and a contract is subsequently signed it may be that the host must make upany shortfall that the researcher is entitled to, so please ensure that data, in particular thatrelating to the fellow (marital status/ employment contract type, etc) is correct and verified bythe researcher.

In addition amounts which are incorrectly claimed cannot be paid. So, for example if yourequest a travel allowance to which you are not entitled, even if it is included in the contract,when the audit certificate indicated that this is not the eligible amount, it will not be paid, so

please ensure travel allowances are correctly filled out (guidance is given below)

In some cases in the past the CPFs have been forwarded to the researcher to complete and thissometimes leads to incorrect information regarding the exact name of the legal entity or information about previous contracts. On other occasions the CPFs are completed by the hostand the marital status, children, work agreement information does not reflect reality. It isstrongly advised therefore that the host organisation fills in the CPFs and checks explicitlywith the fellow these issues. This will reduce the time for clarification afterwards and speedup the entire process. To assist in this process this year a Negotiation Questionnaire is being

sent to every researcher so that they can fill in the necessary information and send it to therelevant host. Please ensure that the CPF form is consistent with the NegotiationQuestionnaire and that the Negotiation Questionnaire also accompanies the CPF when it isreturned to the Commission services.

Please note that you may be one of the 200 contracts currently being negotiated. If the CPFsinformation is not correct then our capacity to prepare the contract in line with our planningwill be reduced and experience shows that significant delays can result.

Please also note that 2006 is the final year of the Sixth Framework Programme and thereforeall negotiations AND formal Commission selection Decisions must be completed by the end

of 2006. If a CPF is not returned by the date specified in the accompanying letter the


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Commission services will interpret this as a termination of the negotiation process and will pass available funds to the next available proposal on the reserve list.

Please read this guidance when filling in the electronic CPF forms. Please note that the web

site below shows a Word version of the CPF forms with the formal explanation of each fieldin the CPF forms. It may be a useful additional guide if there is a specific issue which is notclear. http://www.cordis.lu/mariecurie-actions/iif/manage.htm

I would like to use this opportunity also to inform you about the fields with a financial impact.These fields should - due to their nature be filled in very carefully because the data willinfluence the amount of the maximum EC contribution: CPFform

field Impact on the followingallowance(s)

A1 Duration in months living, mobility, contribution to the participation costs of the eligible

researcher A2a Country (of the host institution *) living, mobilityA3 Place of origin travelA3 Are you entitled for the FULL mobility

allowancemobility

A3 Full time postgraduate research experience livingA4b Research classified as Laboratory-based contribution to the participation

costs of the eligible researcher A4b Type B fellowship during Main Phase

(Y/N)living

A4b Travel allowance Main (This is an amount, NOT a distance)

travel

* for international organisations the country of the laboratory where the fellowship will take place.

The Commission services take for granted that applicants who could not prove their eligibility(PhD or 48 months of Full-time postgraduate research experience) at the relevant deadline for the submission of the proposal ( 18/01/2006 ) will provide the appropriate evidence bythemselves without the need of being reminded. In order to avoid delays in the contract

production or even a rejection-letter at the end of the additional 8 months deadline (which will be sent if the Commission services does not receive the necessary evidence within thedeadline!), you are invited to provide the necessary evidence as soon as possible (if you havenot done that so far).

It should also be noted that the host must ensure that information sent back in the electronicversion of the CPFs is THE SAME as that subsequently sent on paper (signed). It is theelectronic version from which data will be imported and if the paper version is different thiswill potentially be the cause of significant delays.

2. Specific Guidance for filling in the CPF forms

You will also find a short technical guide for opening and using the CPF editor if you are notfamiliar with it. It is called Doc 2 -Technical guide for using the Excel CPF editor .
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H OW TO FILL IN THE E LECTRONIC CPF FORMS - G ENERAL COMMENTS

Please fill in the CPFs in the electronic format and forward them back to the Commission(e-mail address mentioned in point 2 of Annex I) before the date indicated in the letter.

Please check and/or fill in information contained in all yellow fields, if applicable.

Once all relevant fields in forms A1, A2, A3 and A4b are filled in, you will be able to seethe calculation of the entire fellowship in forms A5a and A5b, by phase and for the total.

Some forms (A2c, A6, and A7) must be signed and the originals sent back to theCommission.

Form A1:

- Requested project Start Date

This is the date when you want the PROJECT to start. Note that this is different to the datewhen the contract enters into force. The contract enters into force on the date when it is signed

by the Commission representative (which is after we have sent you the draft contract and after it has been signed by the Host representative and returned to the Commission).

You should note that the start date of the project can be BEFORE the contract has entered intoforce. As long as the negotiation has been completed and a Commission Selection decision has been made the project can start and eligible costs can be charged to the contract EVEN IFTHIS IS BEFORE THE CONTRACT HAS OFFICIALLY ENTERED INTO FORCE.However, if the host is prepared to start the project at a date before the contract enters intoforce they must ensure that they have their own resources to cover the period between the

project start date and the signature of the contract. These costs will of course become eligible

once the contract comes into force but the fellow must not be penalised due to shortage of funds if the host agrees to pay the fellow before the contract comes into force. (The projectstart date must also be reflected in the Work Agreement made between the fellow and host)

(For information the Commission Selection decision is the formal decision process whichsets aside a specific financial contribution for your contract and is a formal process whichtakes place when the negotiation is finalised and before the Contract is signed).You should note that Costs can be incurred on the project from the start date of the project

but not before. Where this date is prior to the contract coming into force, future contractorstake the risk that the contract may, for some reason, not be signed in which case these costswill not be reimbursed by the Commission.

You should therefore enter the date when you want the PROJECT to actually start in this boxin the CPF.

Experience has shown that if you specify a date that is unrealistically early this gives rise toinflexibility and then immediate contract amendments. It is advised therefore to take arealistic start date, for example, after October 2006 and enter that into the CPF. This gives acredible time for the selection decision to be made and the project can then start even if theCommission has not yet signed the contract.

If you specify a start date (what we call option 2- see below) if this date is within 3 months of

the signature of the contract the pre-financing payment will be made within 45 days followingthe date the contract comes into force. If the start of the project is more than 3 months after


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the contract comes into force then the pre-financing will only be paid when you notify us of the actual start date. Pre-financing will then be paid 45 days from that notification.

If you intend to start in or after December 2006 then chose option 4 and notify theCommission services when you have started. In this way you have flexibility and avoid any

request for amendments if the date changes.

Please also note that if you wish to start at the earliest possible starting date then this would beenvisaged for 18 October 2006 .


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- Abstract

This is the abstract from your original proposal. However you could revise it if you think thisappropriate.

You should not use more than 2,000 characters. The abstract should, at a glance, provide thereader with a clear understanding of the objectives of the proposal and how the objectives will

be achieved, and their relevance to the objectives of the Specific Programme and the Work Programme. This summary will be used as the short description of the project for the publicfollowing contract signature and in communications to the programme managementcommittees and other interested parties. It must therefore be short and precise and should notcontain confidential information. Please use plain typed text, avoiding formulae and other special characters. The abstract should be written in English.

Form A2a:

- Organisation Legal Name

Note that for Incoming International Fellowships forms 2 is filled in by the EuropeanHost. The form 2c should be signed and stamped by the European Host.

In order to ensure the commitment of the organisation to which the researcher will beseconded (the host in the third country), please provide a letter that demonstrates their commitment to host the researcher and offer the necessary infrastructure required to carry outthe corresponding period of the fellowship. In case this information has already been sent withthe original application, there is no need to send it again.

If the European Host already has contracts with the European Commission and you know thatyou are a registered Legal Entity within the Commission financial databases (sometimesreferred to as holding a Fichier Entit Lgal- FEL) then use this legal name and address. Inthis way we will be able to use the current registration with the Commission financial servicesand you will not have to supply legal documents demonstrating your legal status (statutesetc.).

If you are not registered with the Commission for any other running contracts then pleaseenter the formal legal entity as specified in the proposal.

Form A2b: (for the European Host)

- Previously submitted or similar proposals or signed contracts

This question enables us to take into account any other negotiations in order to identify any potential dual funding for the same costs. Please identify any other proposal or contractrunning or being negotiated for another Marie Curie Action.


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Any running contract numbers are useful in order that we can identify you as a legal entity inthe financial database and this will speed up the negotiation proceed as we will not have torequest the creation of a new legal entity in the Commission database (which can take severalweeks - this process is not performed by the Marie Curie Operational Units and is part of acentralised Commission service so the delay cannot normally be reduced).

Form A3:

Number of Years of Research Experience (More or less than 10 years)Your proposal has been reviewed by the independent experts who have formed a viewregarding whether the fellows research experience is more or less than 10 years (this affectsthe salary level for the fellow). The outcome is recorded in the ESR as a YES or NO answer.If the experts answer differs from that which you submitted in the proposal the CPF form has

been loaded with a number of full time equivalent postgraduate research months which isconsistent with the opinion of the independent experts.Please review this particular field carefully as it has consequences for the level of funding.

If you disagree with the opinion regarding less or more than 10 years of full time equivalentresearch years then please change the entry in the specific field AND send justification whichis strong enough to overturn the view of the independent experts conclusion.

- Full Mobility Allowance

Note that fellows undertaking a transnational mobility or who have undertaken a transnationalmobility within the 12 months prior to the deadline of the call are entitled to a mobilityallowance. This applies to the outgoing and return phases of the fellowship except in thefollowing case:-.

ImportantThe mobility allowance is not applicable during the reintegration period in the case whereit is carried out in the researchers country of origin.

If you the fellow is married, have children or and an equivalent status to being married in

the host country (supported by a formal certificate provided by an appropriate authority) thenthe fellow is entitled to a higher mobility allowance which we call the FULL mobilityallowance.

Please note that one of the major causes of contract delay and amendment is that the hostincorrectly reflects the marital or family status of the researcher. PLEASE CHECK WITHTHE RESEARCHER that his/her MARITAL STATUS or FAMILY STATUS is clearly andaccurately reflected. If you enter into a contract where this information is wrong and thefellow is entitled to a higher allowance then the host may be liable to make up this difference.Specific guidance on this point is reproduced here copied from the standard CPF explanatorynotes issued with the Word form CPF available at

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F ull mobil ity allowance

You qualify for a higher mobility allowance to cover expenses linked to your family situation if you aremarried (or in a relationship of equivalent status recognised by national legislation) and/or if youhave dependant children. Note that this allocation will only be due for researchers undertaking transnational mobility. Your eligibility status is indicated by a YES or NO in the box.

If there is a chang e of the criteria eligible to receive the full mobility allowance from NO in the proposal to YES in the C ontract P reparation F orms evidence supporting this change has to be provided.

Please note that if the fellows marital or family status has changed from that declared in the proposal the fellow should provide evidence of the correct status at the time of the deadline,or at a time up to the end of negotiation if you think this status may change.

Note that if the fellow got married or had children after the deadline and is aware that thischange will be formalised before the end of negotiation (that is before the CPFs are returned

and the selection decision is taken) then please inform us with the relevant evidence as themobility allowance can be adjusted up to the date of the selection decision (see above for explanation of what a selection decision is) , so if the fellow is pregnant or planning to getmarried at the time of the negotiation please inform us of the relevant dates.

- Date of PhD awarded or Expected date of award

Please note that if, in the Evaluation Summary Report (ESR), it is indicated that the fellowdoes not have 4 years of research experience then the award of a Marie Curie Individualfellowships in CONDITIONAL on the fellow receiving his/her PhD within 8 months of therelevant deadline (that is before 18 September 2006 at the latest) THE FELLOW MUSTtherefore provide evidence that this award has taken place before this cut off date or the statusof this proposal will change to ineligible.

Please specify very carefully the date of PhD already awarded (if it has been awarded) or thedate anticipated.

- Place of activity

In order to judge the eligibility for the travel allowance (which will be filled in Form A4b)THE FELLOW MUST provide his/her exact location and time periods for all relevant

periods.

Another major cause for the delay in contract production is the clarification of entitlement toallowances and eligibility relating to residency in the host country and in Europe. If thisinformation is not sufficiently clear that we can determine the eligibility of allowancesrequired in the contract then the negotiation process will stop and individual clarification will

be required. So please ensure the researcher provides accurate information (consistent withthe proposal) for this section. The information must be continuous for the full 5 years prior tothe deadline.

Our experience is that more than 70% of negotiations claim a travel allowance which is toohigh and it simply causes delays in the negotiation. If these figures go unchecked it could lead


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to serious consequences as the Commission can only pay what the audit certificate confirms iseligible and the host may eventually be liable for any shortfall if the fellow has an expectationof an incorrect amount.

Please note that when determining travel allowance, the audit certificate required at the end of

certain reporting periods will verify the eligibility of these claims and if the fellow is notentitled the allowances will not be paid.

Form A4b:

- Research Classified as Laboratory based or not

In the Evaluation Summary report (ESR) the independent expert evaluators have reportedtheir opinion as to whether this project is to be considered Laboratory Based or not.Laboratory based projects carry a slightly higher contribution for research costs for the benefitof the research project.

If you enter data which conflicts with the opinion expressed in the ESR then you must send asupporting justification CONTAINING SUFFICIENT DETAIL that the Project Officer during the negotiation phase can make a decision based on justified and transparent reasons.In other words if you say that the project is lab based and the expert evaluators have recordedit as NOT lab based in the ESR, then you must send justification as to why you feel it is lab

based in sufficient detail so that the Project Officer has a basis for any revision of this judgement.

- Stipend during the Main Phase

You may be aware that there are normally two options for a work agreement between theHost Organisation and the Researcher . They are Employment Contract or Stipend .

It is worth commenting that well over 90% of fellowships opt for the Employment Contract asthis is a typical agreement where the fellow is employed at the host laboratory throughout thefellowship and is therefore covered by normal social security arrangements in the country of

the host.

In some cases, usually where a fellow retains some sort of salary from another organisation,the fellow may opt for a stipend. That is a lower financial contribution where the fellowreceives the minimum social security covers in the host country, often because there is someother cover being provided by a host elsewhere. A typical circumstance where the option of stipend is used is where a researcher is employed in industry and goes for a short fellowshipto a new host organisation. The original salary continues to be paid by the original employer and the stipend is a sort of top -up paid whilst the fellow is at the temporary host. Theoriginal host continues to make some social security provision in the original country andonly a minimum cover is required in the temporary host. Another example is a fellow who

already has a grant on one country and will be spending a 2 year fellowship abroad as part of


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that fellowship in which case the original grant continues to be paid and the Marie Curiestipend is used as a top -up to that grant.

In most cases an Employment Contract is expected. Therefore if you and the fellow chose for the option stipend YOU MUST send a clear justification WHY you are taking this option. If,

by mistake, you opt for a stipend and the contract is agreed and signed with this option andyou later realise that you wanted a full employment option, the host may be liable for anyshortfall in payment that is the host may have to top-up the difference between a stipend andan employment contract. For this reason it is important that the host AND the fellow agree theoption being selected and it is not assumed that a stipend will be acceptable for the fellow.

Note that further (more legal advice) is offered in Annex 1 at the end of this document.

- Travel allowance

The table place of activity within the last 5 years in Form A3 must be filled in with NOGAPS between the specified times and the deadline for submission of proposals. The place of activity must also be determined at the time of the deadline for submission of proposals.

If the fellow was already in the country of the incoming host at the time of the deadline, buthad not been there for more than 12 months then the fellow may be entitled to a travelallowance taking into account the distance between relevant capital cities. Section 6.3.1 of theGuide for Proposers explains this in detail (web link http://www.cordis.lu/calls/mariecurie-actions/ ).

It should be noted that many forms are not correctly filled in this regard. It is a major sourceof delay for contract preparation when travel claims are not correct. The Commission can only

pay what the fellow is entitled to and in the end an auditor will check the relevant details before verifying that the fellow was eligible for the claim. If it is not correct it cannot be paid by the Commission Services and the host may be liable for any shortfall in contribution if thefellow has a legitimate expectation that this travel will be paid. Please therefore check that thefellow is entitled to a travel allowance and check the linear distance between towns (if relevant). Note that several free internet sites are available for checking linear distances

between towns. Please check the distance carefully before submitting the CPFs as anyamendment will cause specific correspondence which will delay the contract production.
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Annex 1

Information on Stipend or Non-stipend

Employment contract/Stipend

This note tries to clarify the difference between the two categories under which a researcher can be recruited in the frame of a Marie Curie scheme (employment contract and fixedamount stipends) as well as their consequences with particular emphasis on the social securityimplications.

Employment contract:

The amount of living allowance under the category employment contract laid down in theWork Programme includes a compulsory deduction under national legislation both in terms of taxation and in terms of social security coverage. According to the various social securityschemes applicable in all Member States, an employment contract shall guarantee apackage of social security coverage made of several items. These items, expresslyindicated in the Council Regulation (EEC) No 1408/71 of 14 June 1971 (on the application of social security schemes to employed persons and their families moving within theCommunity), concern sickness and maternity benefits, invalidity benefits, old age benefits,survivor's benefits, benefits in respect of accidents at work and occupational diseases,unemployment benefits, family benefits and death grants.

Fixed amount stipend:

According to the Work Programme and the contractual documents the stipend is a sort of grant that can be proposed to early stage researchers (and only exceptional duly justified casesto experienced researchers) as an alternative to the employment contract.

De facto , the fixed amount stipend consists in a residual category allowing the host institutionto host a researcher with a status (of researcher or research trainee) other than that of worker under a typical employment contract. This may happen for:

- similar researchers or research trainees (e.g. for master level training, especially for shorter stays);

- stays of visiting researchers (including experienced researchers) are particularly short .

The host may opt for the stipend solution when it is not feasible to conclude an employmentcontract for some reasons, for instance because of the constraints of national law (e.g. for short term employment, due to the 3d country nationality of the fellow, or because of theinternal burden for the host institution).

Legal framework

According to the article concerning the eligible cost of the projects and namely the paragraph concerning the monthly living allowance for the researcher laid down inAnnex III The contractor shall appoint experienced researchers under an employment

contract, except in duly justified cases. For early stages researchers, the contractor can
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opt between an employment contract or a status equivalent to a fixed-amount stipend or grant according to the following annual rated: [.] The reference rate indicated above for researcher appointed under an employment contract (or any other contract available under national legislation which has the same

social security coverage as that provided by employees), include a compulsory

deduction under national legislation in the contest of this contract. Any status proposed to the researcher equivalent to a fixed amount stipend or grant shall be compatible withthe applicable legislation of the contractor and shall ensure that adequate social

security has been provided to the researcher, but not necessarily paid from the stipend.

According to the article concerning the performance obligations of the host laid down inAnnex III the host shall ensure that the researcher is covered under the social security

scheme, which is applied to employees in the country of the contractor or under a social security scheme providing an adequate protection in terms of level and scope [].

According to footnote 70 of the Work Programme Researchers can only be recruited under a fixed-amount stipend if this is compatible with national legislation and if social

security is provided. However, the host organisation must ensure that minimum social security coverage has been provided to the researcher, but not necessarily paid from the stipend ;

As to the concept of minimum social security coverage the following has to be pointed out.The minimum social security coverage required by the Commission for researchers recruitedunder a fixed-amount stipend shall include only some of the categories foreseen in CouncilRegulation (EEC) No 1408/71 of 14 June 1971, which are namely: benefits in respect of accidents at work and occupational diseases, invalidity benefits. As to maternity benefits ithas to be noted that, even if such a category does not fall within the minimum required socialsecurity coverage requested by the Commission, the Commission can decide (according to theWork Programme and the contractual documents), on request by the researchers and onadvice/consultation of the host organisation, to augment the sum of the Communitycontribution as a consequence.This is the minimum standard required by the Commission when a researcher is recruitedunder a fixed-amount stipend, whether or not the country in which the project will be carriedout has any regulations on this matter. It is clear that a researcher recruited in the frame of aMarie Curie scheme should benefit from exactly the same social security coverage as other researchers working under the same working status (including if he/she is not under anemployment contract but he/she is recruited under a fixed-amount stipend) in the country of

the host institution. In the next revision of the Work Programme, the term stipend will bereplaced by fixed amount contract with minimal social security coverage and fixed amountcontracts with full social security coverage will be associated to the term employmentcontract.
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1.1.1 Cycle Time Reduction: A ProcurementPerspective

Author(s):

Ernest L. Nichols, Jr., Ph.D.

Ernest L. Nichols, Jr., Ph.D., Assistant Professor and Associate Director of the FedEx Center for Cycle Time

Research, The University of Memphis, Memphis, TN 38152, 901/678-4973

1.1.1.1.1 81st Annual International Conference Proceedings - 1996 -Chicago, IL

Introduction. Superior cost, quality and technological performance do not guarantee success in today's

marketplace. Organizations must also be able to compete on the basis of time. This competitive environment

presents new challenges and opportunities for the procurement function. This paper presents an overview of the

cycle time reduction workshop at the NAPM International Purchasing Conference. Specific topics to be addressed

include:

The FedEx Center for Cycle Time Research and its Activities

Cycle Time Reduction Overview

Key Procurement Process Candidates for Cycle Time Reduction

Common Causes of Long Procurement Process Cycle Times

Techniques for Cycle Time Reduction

Critical Success Factors for Cycle Time Reduction

Characteristics of Time-Based Competitors

FedEx Center For Cycle Time Research. The FedEx Center for Cycle Time Research was formed in 1993 as a

strategic alliance between The University of Memphis and Federal Express Corporation. The purpose of the Center

is to conduct research concerning ways of reducing time in organizational processes -- that is, the amount of time

it takes to complete a task -- in a way that reduces cost and/or increases customer service. Much of the Center's

work focuses on finding new ways of using information technology and organizational change to speed the flow

of information, thereby reducing paperwork and needless activity.

The Center operates from a grant provided by FedEx. Three-fourths of the grant supports research projects

requested by FedEx. These projects may address FedEx internal activities or those of key FedEx customers. The

remaining funds are used by The University of Memphis to enhance its information technology academic and

research programs. The Center's research activities are directed by a steering committee composed of

representatives from FedEx and The University of Memphis.

The research conducted by the Center is based on scientific investigation of cycle time issues using case studies,field surveys, field experiments, laboratory experiments, and model building. A key feature of cycle time research


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is that it is interdisciplinary; therefore, the Center's project teams are drawn from various academic disciplines to

achieve results. Research projects completed to date have addressed:

Interorganizational Supply Chains

International Product Distribution

Procurement Processes

New Product Development

Order Fulfillment

Individuals that would like to learn more about the Center are invited to visit our homepage on the Internet. The

address is :www.memphis.edu .

Cycle Time Reduction Overview. Cycle time is the total elapsed time required to complete a business process.

Cycle time reduction has become a key area of opportunity for organizations that are under increasing pressure

to get more done with fewer resources in order to remain competitive. By reducing cycle time organizations can

reduce cost, increase quality, and improve customer service. All too often in organizations, less than five percent

of the total elapsed time performing a process has anything to do with real work. The rest of the time is spent

scheduling, waiting, needless repetition, getting lost, getting found, "left hand not knowing what the right hand is

doing," etc. Cycle time reduction is not just about working faster; it's also about working smarter. By making

innovative use of information technology and organizational redesign, business processes can often be re-

engineered such that non-value added activities are eliminated, thereby cost effectively reducing cycle time.

As organizations increasingly focus on time-based competitive strategies it is imperative that the procurement

function has the capabilities required to support these strategies. However, cycle time reduction is an area that

many procurement organizations have not yet addressed.

Key Procurement Process Candidates For Cycle Time Reduction. Within the procurement function the

following activities are prime candidates for cycle time reduction efforts. Very few procurement organizations are

truly satisfied with their current performance in these areas from a time perspective. Specific procurement

processes that should be examined include:

Strategy Development

Overall Purchase Cycle -- "Requisition to Receipt"

Make/Buy Decisions

Cost/Price Analysis

Supplier Selection

Negotiation/Contract Development

Supplier Development Activities
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Material Transportation

Material Receipt/Inspection

Supplier Payment Cycle

Material Review Activities

Supplier Performance Measurement

Strategic Alliance Development

Training

Others

Common Causes Of Long Procurement Process Cycle Times. There is no shortage of reasons for long

procurement process cycle times (Nichols et al. 1995, Kivenko 1994). In conducting detailed examinations of

processes typically one or more of the following is found. Specific causes include, but are not limited to:

Waiting

Non-Value-Added Process Steps

Serial Versus Parallel Operations

Repeating Process Steps

Batching

Excessive Controls and Bureaucracy

Unnecessary Transfer of Materials or Information

Long Material/People Travel Distances

Ambiguous Goals and Objectives

Poorly Designed Procedures and Forms

Outdated Processes and Technologies

Process Variability

Lack of Information

Poor Communication

Limited Coordination

Ineffective Training


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Techniques For Cycle Time Reduction. Wetherbe in his 1995 article, "Principles of Cycle Time Reduction: You

Can Have Your Cake and Eat It Too," offers a collection of tools and techniques that have proven to be effective

means to reduce process cycle times. Over forty specific techniques are presented that address key business

areas including 1.) organizational management and structure, 2.) human resources, 3.) operations management,

4.) product development and management, and 5.) interoganizational processes.

It is beyond the scope of this paper to discuss each of the techniques. However, an overview of these techniques

will be provided during the workshop session.

Critical Success Factors For Cycle Time Reduction. Tools and techniques are necessary to reduce

procurement process cycle times. However, there are additional enabling factors that must be present in order to

successfully complete a cycle time reduction initiative. Hendrick (1994) identified a number of "critical success

factors" that include:

Top Purchasing Management Involvement

Collaboration With Suppliers

Use of Multi-Disciplined Teams

Identifying Purchasing's Internal Customers' Time-Related Requirements

Top Company Management Involvement

Setting, Monitoring, and Reporting Strict On-Time Delivery Goals For Suppliers

Use of Total Quality Management (TQM) Tools

Implementation of Computerized Purchasing Systems

Setting Aggressive Cycle Time Reduction Goals

Requiring Formal Cycle Time Measurement and Reporting

Implementation of EDI Systems

Training in Cycle Time Reduction Concepts and Tools

Characteristics Of Time-Based Competitors. Characteristics of time-based competitors have been identified

by several authors (Hult et al 1995 and Kivenko 1994). Time-based competitor organizations exhibit

characteristics that include:

Flat Organizational Structure

Process Focus

Commitment to Organizational Learning

Heavy Emphasis on Information Integration and Sharing


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Performance Measures Based on Organizational Effectiveness, Not Functional Efficiency

Passion for Continued Cycle Time Reduction for Competitive Advantage

Application of Cycle Time Reduction Efforts to All Parts of the Organization

Note: This paper provides partial development of the presentation to be made at the International Conference of

the National Association of Purchasing Management. Specific case examples and managerial implications will be

discussed during the workshop session.

introductory note negotiation iif contracts

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