R2P, or RtP, stands for 'Request to
Payment', and refers to the procurement process from
the moment a request is made for material/services, to
when these materials/services are paid and finalized.
As a simple scenario to highlight the R2P process,
consider the following:
- A mine site worker requires parts for drilling and
raises a Work Order
- The parts which are available in stock are
committed to the work order, whilst the unavailable
parts are converted into a Purchase Requisition,
which flows through to the procurement team
- The procurement team source the parts and raise a
Purchase Order on the appropriate suppliers
- The suppliers deliver the parts to site, and they
are Receipted into the system
- The invoice for the parts is paid by
- The original Work Order is closed off
A Reverse Auction is an e-procurement tool
whereby the purchaser advises the details of what they
need to procure, and potential suppliers compete to
submit the lowest bid.
The process begins with the purchaser advising their
requirements, starting price, and time-frame for bids.
During the Reverse Auction, the potential
suppliers are able to see the current lowest bid, and
can submit lower bids against it until the auction
RFI, aka Request for Information, is a process
of gathering information from potential suppliers in the
form of a written document, to learn more about the
products/services they provide and their capabilities.
RFP, aka Request for Proposal, is a process
used by Procurement when a requirement is clear, but a
solid solution to the requirement is not, thus allowing
potential vendors to propose their solution.
The information documented in the RFP includes
Scope of Work, Terms and Conditions, Technical
Specifications, Schedules, Bidder's Meetings etc.
Requested information from the supplier includes
Corporate Information, Financial Details (eg: turnover),
Key Personnel, Qualifications, Sub-Contractor Details,
Evaluation criteria for an RFP includes
Technical Compliance, Functional/Operational/Performance
Capacity, Compliance to Terms and Conditions, Compliance
to OH&S, Pricing etc.
RFQ, aka Request for Quotation, is a
procurement process whereby suppliers are invited to
provide written quotations, based on clearly defined
product/service requirements. Once all quotes are
received, a simple evaluation process is performed based
on weighted criteria, and a Purchase Order is released
to the chosen supplier.
The RFQ document includes the material/service
specification, delivery details, quantities, conditions
of quote (eg: deadlines), and sections for the supplier
to fill in their Price etc.
An RFQ process allows for easy comparison of
bids, and it also informs a supplier of a competitive
process, which can yield better savings.
RFx refers collectively to the procurement
- RFI (Request for Information)
- RFP (Request for Proposal)
- RFQ (Request for Quotation)
- and RFT (Request for Tender)
For example, a job ad for a procurement role might
say "the applicant must have RFx experience",
which refers to all of the processes collectively.
E-RFx is the same except it refers to managing
the complete RFx process via a web-based
Risk Management involves
- identifying the risk
- determining the level of risk
- Terminating, Treating, Transferring, or
Tolerating the risk.
- Monitoring the Risk