Procurement in Portugal Telecom

The Portugal Telecom Group has defined a Procurement Model with the objectives of optimizing and integrating procurement of goods and services for the various Group companies. This Model includes the Competitive Tender Process, consisting of various stages where each participant assumes different responsibilities:

1. Identification of a need and definition of the technical specification – after the procurement need has been identified, the Group company should send to PT Compras all necessary technical characteristics and desired service levels for the launch of a competitive tender.
   
2. Preparation and Launch of a Competitive Tender – PT Compras prepares the Competitive Tender Document, normally consisting of the Tender Programme, the Specifications (including technical proposal and commercial proposal specifications) and the Model Contract. Suppliers to which the Tender Document is sent are selected through the PT Compras Database. Suppliers not yet registered in the aforementioned Database should consult the Pre-Registration area. 
   
3. Proposal Presentation – suppliers should hand complete proposals to PT Compras, handing the corresponding technical and commercial proposals separately, according to the criteria defined in the Competitive Tender document.
   
4. Technical and Commercial Analysis – After proposal reception, PT Compras will send technical proposals for analysis by the Group company areas that will use them; commercial analysis of proposals will be performed by PT Compras.
   
5. Planning by the Procurement Table – The Portugal Telecom has a Procurement planning and decision Committee. Based on proposal analysis, the Committee Procurement Table will define the following: negotiation and tender selection strategies and negotiation targets (target conditions), as well as the series of suppliers that will proceed to the negotiation stage.
   
6. Negotiation – following planning stage guidelines, PT Compras will start the negotiation process by communicating the negotiation targets defined by the Procurement Table to selected suppliers; this stage may entail successive negotiation rounds.
   
7. Tender Selection by the Procurement Table – the Procurement Committee is responsible for final decisions regarding tender selections, which must be unanimous. The supply proposal globally considered more advantageous, in terms of price, technical and functional characteristics, delivery and execution deadlines and contract condition acceptance, amongst other aspects, will be selected.
   
8. Order Placement and Payment – Portugal Telecom companies defining the need to place an order will be responsible for signing the corresponding contracts and process payments to suppliers.

The importance of the Procurement Table should also be referred during this process. This is a structure that supports decision making during the procurement process whereby issues included within the scope of PT Compras are submitted to the Procurement Committee for appreciation. This Committee constitutes an analysis and decision forum where strategies and objectives are defined for negotiation processes and tender selection decisions are made. Presently, Portugal Telecom procurement is managed by three different Procurement Tables: Lisbon, São Paulo (VIVO) and Casablanca (Médi Télécom).

Following the presence of the Portugal Telecom in four continents - Europe, Africa, America and Asia, as well as in different telecommunications market sectors - fixed, mobile, multimedia, data and directories, PT Compras is equally responsible for all procurement relative to Portugal Telecom International Subsidiaries. In its international activity, PT Compras thus attempts to centralize acquisitions, benefiting from the global Group scale, as well as encourage scale economies. In addition, it also allows establishment of national and international benchmarks, simplified access by companies to global and international suppliers and uniformization of procurement and professionalization criteria for the procurement function. Find out more on: www.telecom.pt