Which set of elements is typically included in a project procurement strategy?

• A. Sourcing approach, contract types, supplier selection criteria, risk allocation, and commercial strategy.
• B. Sourcing approach only.
• C. Contract types only.
• D. Commercial strategy only.

Answer: (A)

The main concept here is what makes up a project procurement strategy. A solid procurement strategy should lay out how you go to market (the sourcing approach), the legal and commercial framework you’ll use (contract types and the commercial strategy), how you will decide which supplier to work with (supplier selection criteria), and how risks will be shared or allocated between parties (risk allocation). All these elements work together to guide procurement decisions throughout the project, align them with objectives, and manage risks and costs effectively.

This set is the best because it covers the full spectrum needed to plan and control procurement. The sourcing approach defines how you locate capable suppliers. The contract types establish the legal relationships and duties, including how changes and disputes are handled. The supplier selection criteria set objective standards to choose the right partner. The risk allocation clarifies who bears each risk, which is crucial for pricing, timelines, and performance. The commercial strategy ties everything together, covering costs, payments, incentives, and penalties to drive value and performance.

Options that include only one element miss essential parts of the plan. Sourcing alone doesn’t define contract terms or risk sharing; contract types alone don’t tell you how you’ll find or choose suppliers; and so on. A holistic view is necessary to manage procurement proactively and cohesively.