Project Management Office

5 Essentials of Project Contract Management

Contract Management is the process of managing contract formation, execution, and analysis of the financial and operational performance of an organization. However time-consuming it is for the businesses, contract management facilitates the need for effective contract system.

In this article at ProjectManagement.com, Elizabeth Harrin shares her perspective about the ideal way of running contract management in an organization.

Standard Operating Process

In a bid to get services from other companies to suffice the need for expertise, often companies arrange a contract for services. To have a standardized process for contract management, each of the steps require a lot of planning and supervision. Therefore, the author suggests involvement of few essential groups in managing project contracts:

  1. Legal Aid: This group is ideally involved in creating contracts, reviewing, and approving them while getting them signed. The legal team is involved in ensuring if the right regulations and laws are included in the contract clause. For instance, the UK organizations are ensuring that all the contracts abide by the new GDPR rules, replacing the previous Data Protection Act 1998.
  2. Contract Managers: This role demands appropriate skills for negotiating fresh contracts, drafting best contract plan with the vendors, organizing and executing non-disclosure agreements and much more. The contract managers must be involved way ahead in the project, even before the selection of the vendors. They need to evaluate vendor proposals and decide on establishing the contract with the right supplier for the organization.
  3. Procurement Division: This is broader than contract management. The procurement team is accountable for everything, right from preparing bid documents, dealing with supplier queries, to shortlisting vendors. Hence, they must have detailed knowledge of the project needs.
  4. Vendors Management Team: It is a broader role, majorly valuable to a project manager. The vendor manager establishes a healthy relationship with the suppliers to manage several project’s requirements.
  5. Project Manager: This is the key role in executing the contract by getting the desired work done within schedule and budget. The project managers need to ensure if the contract deliverables are carried out while keeping a watch over risk management, project scheduling, and They are the first one to counter potential issues or defects in the contract.

The author suggests involving reliable experts in the contract management who can establish seamless supplier engagement and strong relationship with the vendors. Read the original article by clicking the following link: https://www.projectmanagement.com/blog-post/40575/5-Groups-Involved-in-Project-Contract-Management

 

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