Key Principles of Value for Money, Ethics, Competition, Transparency, and Accountability

Procurement in Practice
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Procurement in Practice
Summary of Key Principles
Value for Money
The principle of value for money holds that procurement processes need to be conducted to achieve the most benefit in terms of quality, cost, and sustainability across the project life cycle. Across all types of procurement, the primary goal is to achieve value for money, which means reaching the best possible contractual agreement (Hassan et al., 2021). The vendors are expected to deliver according to the firm’s expectations. Therefore, the focus should not be on low prices but the right combinations of cost and quality.
Ethics
Ethics in procurement is the principle that all dealings must be done with integrity. Therefore, it means that collusion or corruption with suppliers and other stakeholders involved in the project is not allowed. According to Hassan et al. (2021), integrity or ethical practice in procurement is the best way to achieve value for money. The rationale is that corruption or collusion will make procurement contracts more expensive than they should be. Additionally, rogue suppliers may fail to deliver as per expectations if they engage in unethical practices.
Competition
The principle of competition holds that procurement processes should be competitive except where it is legally allowed. Competition among suppliers means that a firm can get the best prices possible in addition to gaining value for money (Kohler & Dimancesco, 2020). Competitive procurement works in the same way as a perfectly competitive market structure where the buyers have the freedom of choice. Therefore, vendors are allowed to present the best possible offers and proposals where only the best is selected. The company benefits most from this principle since it gains an edge in procurement contract negotiations.
Transparency
Transparency is a principle in procurement that requires all procurement practices to be open and clear in their conduct. According to Rodriguez (2019), transparency is the key to a successful procurement since it makes the procurement market open and accessible. Additionally, transparency allows all stakeholders to see what is being done and how all actions are performed. Therefore, this principle means that all parties involved can conduct themselves with integrity since they are all under watch. All communications and records are kept open and accessible to all those who need them.
Accountability
The principle of accountability implies that the officials or the people involved in procurements are responsible for the decisions and actions and, therefore, the resulting outcomes. This principle should guide such elements of procurement as prices and procedures. Therefore, all procurement activities, including planning, tendering, contracting, and implementation, should be expedited by individuals who can handle all the responsibilities (Kohler & Dimancesco, 2020). Procurement can exhibit critical risks, including financial losses from errors and malpractices. Therefore, accountability is a principle that helps in mitigating these risks and safeguarding the firm from any losses, delays, or inefficiencies during the procurement process.<...