Experience says that in business, the contract must be treated as a living thing.
Proper contract management must be like a guide that reminds the company as well as clients about the deadlines, the requirements, deliverables, roles, responsibilities and obligations which have entered into the contract and be accountable for it.
Although it must be flexible and adaptable to all and any of the changes.
Following are the few points that one must keep in his mind while deciding on excellent contract management:
1. Give the topmost priority to contract management
The main aim of proper contract management must be its ability to maintain and manage the contracts.
In the planning of management, contracts must be the foremost task to accomplish.
One must know that for contract management, the cost incurred is 5-8% of the total expenditure of the contract.
The planning must be in a very detailed manner and thus ensuring the continuity and effective strategy.
One must know that for contract management, the cost incurred is 5-8% of the total expenditure of the contract.
The planning must be in a very detailed manner and thus ensuring the continuity and effective strategy.
2. Document storage space
The business must ensure at the beginning itself if there is a facility proper facility for storage or not.
Good contract management must also ensure that the documents are appropriately verified and identified as well as versioned.
For contract signatures, the manager must create a library for all the documents that are material to the contract.
This becomes an easy task for a manager to locate these documents for future reference.
3.Post contract information
Proper contract management must also give clear visibility and accuracy of all the terms related to the contract that is needed to manage the contract.
The management must build in a system in such a way which must obligate for all the parties involved to see through the contract and audit all the information.
4. Invoice Design
Not just the transparency, accuracy is an equally important aspect to look upon.
The invoices should be designed in such a way that clients can locate any entry or transaction whenever they want from the contract, and this shouldn’t waste time, only that would ensure proper contract management.
5. Inclusion of appropriate management provisions
Proper contract management must ensure that all the essential requirements and tools must be there during an ongoing contract.
The elements must vary from daily routine delivery or service management to the testing and arrangements to find out the best value.
6. Preparation of contract user guide
Proper contract management must prepare in a guide for its users and clients of the contract in which they would lay terms as to how the whole management works and the provisions and mechanisms that exist in it.
7. Timeline of Decisions
During the journey of a contract, there are various stages of meetings, governance structure, roles and responsibilities, and this all must be kept updated.
A proper timeline must be prepared in a sound contract management system that would provide a useful framework so that planning may be done in advance.
8. Recognize Issues
A sound contract management system must ensure to solve all the problems, address them and clarify the issues as early as possible to make it easy for the client as well.
Because as things are delayed, it becomes harder for the managers to sort it out.
9. Careful behaviour
Most of the contracts that get troubled are because of the clashes in two different personalities.
Thus, proper contract management must ensure equally good working relationships as well and respect between all the parties that are involved.
It can be made more convenient if the escalation mechanisms are agreed upon way before the contract is set against the world.
The primary aim of this is to ensure the proper delivery of contractual obligations through a beneficial relationship.
Conclusion
Contracts must not be considered a mere paper formality or a way to begin a project.
They must be monitored in all the duration of the agreement, updated and maintained to meet any changes and resolve any conflicts that might occur.
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