Towards a better understanding of procurement risks

Under the increasing pressure of the current market conditions, both government and private organizations are being urged to define new policies for purchasing and outsourcing projects. These projects regularly consist of sub-systems, have a high cost associated with them, require a breadth and depth of knowledge and skills in multiple disciplines, involve multiple collaborators and have many aspects of integration, both socially and technically. In order to remain competitive and thus offer better value to the stakeholders, procurement and outsourcing can reap cost benefits while at the same time overcoming the shortage of the technical workforce that large organizations face due to continuously increasing complexity. However there are significant risks associated with the process, which have been evaluated in this paper. Based on an earlier study done at the Finnish Defence Forces, this paper focuses on identifying, rating and ranking the major procurements risks within the Belgian Armed Forces.