mp18

1. Introduction
Many legal aspects have to be considered in projects; aspects that can be clustered concerning the main stakeholders in projects:


 * Project team members often are **employees** working in contracts shaped by their company or public organization on one side and by the conditions of labour law on the other side. Furthermore external consultants often work in a project hired on a service contract and of course also under the conditions of labour law.
 * **Suppliers** submit products and services based upon contracts.
 * Projects lead to results that are sold somehow to those who ordered these results - the **buyer**. There are many options what finally will be sold, outputs of a project, joint venture results, etc. Often many legal aspects have to be considered.

This course has the main focus on **contracts and procurement**. Further aspects like labour law will be mentioned but not discussed in detail.

Contract law is introduced based on the context of a contract: subject-matter, involved parties, contract types, contract features. Contract administration and claim management are discussed. The impact of contracts on projects is discussed, including special risks with contracts in projects.

Core issues of procurement are buying decisions, classification of commodities and services, supplier selection, contracting, delivery, etc. Procurement processes are discussed, and procurement based upon e-commerce transactions.

Finally international standards on procurement in project - the knowledge areas on procurement in PMBOK and in the PMI Guide on Program Management shape the course.

The course is also well integrated within the framework of EuroMPM courses. The course is linked to courses on standards, quality management, risk management, planning and control, and others.

The learning out-comes within framework of European Qualification Framework (EQF) are defined and documented for the knowledge, skills and competence levels. The objectives are to enable students to explain concepts of contracts and procurement and to consider recent developments (procurement and e-commerce). At skills level, they will be able to detect, develop and apply tools and techniques for project planning. The students will also develop competence to analyze and develop new concepts for contracting and procurement. They understand the connections to other areas of project management.

Introduction

 * Legal aspects in project management
 * Standards regarding law and the project management standards (PMBOK, ... )
 * EU standards regarding contracts and Procurement

Contracts

 * Core issues of contracts
 * Types of contracts
 * Contract strategy, partnering, contract administration
 * Parties involved in contracts: customer, contractor, sub-contractors
 * Core features of contracts: subject-matter, duration, validity, delivery, payment, etc.
 * Special features of contracts: warranty, exclusion of liability, etc.
 * Impairment of performance: contractual penalty, price reduction, compensation, termination, etc.
 * Contract administration: phases, procedures, tools
 * Claim management: individual claim, claim prevention
 * Special risk associated with project contracts
 * Advanced concepts on contracting

Further legal issues

 * Employment law
 * Data protection, protection of privacy

Procurement

 * Core issues of procurement: buying decisions, supplier selection, contracting, delivery, etc.
 * EU rules for procurement
 * Direct procurement: Raw material and production goods
 * Indirect procurement: Maintenance, repair, and operating
 * Classification of commodities and services
 * Selection of commodities and services and potential suppliers.
 * Procurement process: Information gathering, supplier contact, negotiation, shipment, payment, etc.
 * Procurement based upon e-commerce transactions
 * Procurement according to project management standards: Procurement processes according to PMBOK, etc.
 * Advanced concepts of procurement

3. Case Studies
A case study on contracts will be discussed at the beginning of the course. A second case study on selected procurement processes for commodities and services that are needed in a project will follow.

4. Parameters

 * ECTS: 3
 * Hours of study in total: 90
 * Weekly hours per semester: 2
 * Contact hours: 30
 * Self study hours: 60
 * Course characteristics: compulsory
 * Course frequency: every year - summer semester
 * Maximal capacity: 15 students
 * Course admittance prerequisites: no special requirements
 * Skills trained in this course: professional, methodological, and personal skills
 * Assessment of the course:
 * 75% contributions within the course (group work on case study, individual paper on research topic)
 * 25% written or oral examination at the end of the course
 * Teaching staff: Prof. Dr. Eckhard Flohr, Prof. Dr. Peter Reusch, NN

5. Learning outcomes

 * 5.1 Knowledge**

The students are able to


 * describe core issues of legal aspects in project management.
 * explain contract types.
 * explain different parties involved in contracts.
 * explain core features of contracts: subject-matter, duration, validity, delivery, payment, etc.
 * explain special features of contracts: warranty, exclusion of liability, etc.
 * explain different cases of impairment of performance: contractual penalty, price reduction, compensation, termination, etc.
 * explain contract administration: phases, procedures, tools.
 * explain claim management: individual claim, claim prevention.
 * explain special risk associated with project contracts.
 * explain describe core issues of procurement in in projects: buying decisions, supplier selection, contracting, delivery, etc.
 * explain direct and indirect procurement.
 * explain the classification of commodities and services.
 * explain how to select commodities and services and potential suppliers.
 * explain the procurement process: Information gathering, supplier contact, negotiation, shipment, payment, etc.
 * explain procurement based upon e-commerce transactions.
 * explain procurement according project management standards: knowledge area of procurement in PMBOK and in the Guide to Program Management, processes to run an control procurement in projects.
 * explain core rules and regulations regarding procurement in EU.


 * 5.2 Skills**

The students are able to
 * analyse contracts and check the impact of a contract
 * design a contract - and submit it as a proposal
 * select commodities and services and potential suppliers - applying classification of commodities and services
 * select suppliers
 * develop orders regarding all core issues (delivery, shipment, payment, etc.)
 * manage the supply chain in projects
 * develop concepts for contracting
 * develop business rules for procurement

in a given context in the course


 * 5.3 Competence - attitude**

They are able to
 * analyse contracts and check the impact of a contract on a project
 * support the design of contracts - with professional lawyers
 * support contract administration in projects
 * support claim management in projects
 * support or manage procurement in projects
 * select commodities and services and potential suppliers - applying classification of commodities and services
 * select suppliers
 * develop orders regarding all core issues (delivery, shipment, payment, etc.)
 * manage the supply chain in projects
 * develop business rules for procurement

in a new context / project.


 * 5.4 On scaling outcomes**

The assessment of learning outcomes is based upon the following core perspectives:
 * Completeness – regarding types and features of contracts; perspectives of contract and claim management
 * Analysis - impact of contracts on projects
 * Analysis - impact of procurement on projects
 * Analysis - analyse the state of the art in certain fields of research on project planning
 * Concept building - development of procurement processes according to standards
 * Problem solving - supplier selection (basic solution - advanced solution)
 * Tools - classification of commodities and services
 * Tools - e-commerce transactions
 * Linking - Relating contracts and procurement to different areas of project management – standards, quality and risk management, etc.

6. Teaching and training methods:

 * Lectures introducing concepts, methods and tools
 * Group work to practice concepts and methods, to develop skills and to work on case studies
 * Home work to add individual contributions

7. Course mapping
This course is linked to other courses of the study program in the following way:

The introduction in MP01 shows the need for contracts and procurement.
 * MP01: Projects: Concept, Types, Cases, Context and Organization**

The discussion on stakeholders and customer relationship supports the understanding for contract. And contracts are embedded in project life cycles.
 * MP02: Life cycle Concepts, Maturity Models, Customer Relation Ship, Stakeholder Management**

For Project Procurement there are standards like PMBOK, PMI Guide to Program Management, that are discussed in MP03 and are continued in MP18.
 * MP03: Standards and Mainstreams**

Contracts and procurement are linked to tasks in project planning.
 * MP04: Project Planning**

Contracts and procurement are embedded in project control.
 * MP05: Project Control**

Team members take part in contracting and procurement.
 * MP06: Team management**

The development of a project organization includes team building processes and leadership.
 * MP07: Project Organization**

Quality management principles and processes shape contracting and procurement.
 * MP08: Managing Quality**

Contract risk is embedded in risk management.
 * MP09: Managing Risk**

Costs of contracts and procurement have to be considered in project economics.
 * MP10: Project Economics**

Communication with contractors and suppliers is an important issue.
 * MP11: Communications**

Social competencies support contract development.
 * MP12: Social Competencies**

The impact of changes on contracts and procurement have to be considered.
 * MP13: Change Management**

Decision making supports contracting and procurement.
 * MP14: Creativity and Decision Making**

Intercultural communications support contracting and procurement.
 * MP15: Intercultural Communications**

Information and knowledge on contracts, contractors, suppliers, orders, etc. have to be managed.
 * MP16: Information and Knowledge Management**

Contracts and procurement are based upon finance.
 * MP17: Project Finance**

Contracts and procurement are harmonized and controlled with programs.
 * MP19: Program and Portfolio Management**

Contracts and procurement may have an impact on safety, health and the environment. So statements on these issues should be considered in contracting and procurement.
 * MP20: Safety, Health and the Environment**

8. References:
Most course materials are available in ILIAS and additional web portals (BME, eCl@ss, etc) - a few books to mention here:
 * 1) PMI: A Guide to the Project Management Body of Knowledge - PMBOK® - 4th edition 2008, ISBN 1933890665.
 * 2) PMI: The Standard for Program Management, 2nd edition 2008, ISBN1933890524.
 * 3) Harold Kerzner: Project Management: A Systems Approach to Planning, Scheduling, and Controlling, John Wiley & Sons 10th edition 2009, ISBN0470278706.
 * 4) Ewan McKendrick: Contract Law: Text, Cases, and Materials, Oxford University Press 4th edition 2010**,** ISBN 0199579792.
 * 5) Richard Stone: Modern law of contract, Routledge 9th edition 2011, ISBN 0415598451.
 * 6) Lucinda Miller: The Emergence of EU Contract Law: Exploring Europeanization, Oxford University Press 2011, ISBN 0199606627.
 * 7) Peter Baily, David Farmer, Barry Crocker und David Jessop: Procurement principles and management, Financial Times Prentice Hall, 10th edition 2007, ISBN 0273713791.