The issue of POs

A very common term in our field is PO, and by that we mean a purchase order.

If we take a look at the official definition from the NIGP Dictionary of Procurement Terms we see the following: A purchaser’s written document to a vendor formalizing all the terms and conditions of a proposed transaction, such as a description of the requested items, delivery schedule, terms of payment, and transportation.

A purchaser order, in many cases, serves as a form of contract. It has all the elements of a binding contract (offer and acceptance, consideration, legality, competency of parties, and mutual consent) wrapped up into a single, signed document. This is the case whether an agency issues a PO on paper or in digital form, which has become more and more common.

But “PO” isn’t just used for procurement. We see it used for other things in our personal and professional lives. Here are some examples:

• A military operation might use it to mean Petty Officer, Port Officer or Peace Operations;
• The technology industry often uses it to refer to a person responsible for a specific software version or a Product Owner;
• Planning on going old school and mailing a card (or having a separate mailing address), One might use it to mean Post Office;
• In order to stay on the good side of the corrections industry, it may mean a consultation with your Parole Officer or Probation Officer;
• The abbreviation has also been used elsewhere in our industry to mean Procurement Officer or Procurement Office.

This is hardly the first time that a procurement related term has been used more than once. How about RFQ? This can refer to a Request for Quotation as well as a Request for Qualifications. The latter has likely been around longer, as it is the procurement method used for Qualifications Based Selection (QBS) at all levels of government. So how did it get reused for an informal (or intermediate) method of buying goods or construction.

“Hey, I’ve got an idea for a quick way to solicit quotes. How about RFQ?”

“Um, I think that one is already taken.”

“Nah. Nobody will even notice!”

Much like other professions, procurement has its own language. While project management may use WBS (work breakdown structure) and RACI (responsible, accountable, consulted, informed matrix), procurement has COI (certificate of insurance) and LD (liquidated damages) to pull out whenever needed.

Walk into a public procurement office and you just might hear “Make sure our CO includes a strong SOW in the RFP, as we want to get a good ROI on the GC we select.”

Yes, we tend to use terms in procurement that don’t always make sense. But no need to get POed about it.

Darin Matthews, FNIGP, CPPO, CPSM, is the director of west coast operations for Negometrix, an international leader in digital procurement. He has extensive management experience, speaks throughout the world on procurement issues, and has published several articles and books on procurement and supply chain management. Contact Matthews at [email protected]