CONTRACTS AND CONTRACT MANAGEMENT Flashcards
Define a contract?
The written agreement entered into between the purchaser and the supplier, as recorded in the contract signed by the relevant parties, including all attachments/appendices thereto and all documents incorporated by reference therein
Define contract management?
The process of maintaining control over the contractual arrangements between a department (purchaser) and the appointed supplier (contractor) being the other contracting party by performing the contractual management or administration activities commencing at the conclusion of a contract
What can poor contract management lead to?
End-user frustration
Reluctance to use new vendors,
Agency acceptance of poor quality service or goods
Increased costs due to lack of quality or overpayment to contractors
Lack of contractor accountability
Generally poor contractor performance.
Contract management can also fall under the category of?
Supply Chain Management
What is “Contract Management prescripts”
Rules, orders or orders laid down connection with the contract.
Some causes of contract management failure?
-Poor planning;
-Poor specifications;
-Poor contracting;
-Lack of tools/systems for managing contracts;
-Poor or non-management of contracts and -contractors;
-Non-payment or delays in payments;
-Poor or no risk management;
-Poor or no oversight and governance;
-Poor management of price adjustments and variation orders;
-Non-application of penalties iro poor or non-performing contractors;
-Poor or ineffective document management;
-Lack of skills/inadequate resourcing of contract -management units;
-Lack of ethics; and
-Fraud and corruption.
Where does contract management fit in the Supply Chain Management
Contract management comes at the end after all specifications and requirement have been meet and agreed upon.
The four outlines in contract management ?
Developing Specifications - Specify The Need
What Are Contract Risks To Agency – Protect The Agency
What Is Contract Type
Special Terms And Conditions Of Resulting Contract eliminate Risks
Bullet points in “DEVELOPING SPECIFICATIONS - SPECIFY THE NEED”
- Develop Bid or RFP Specifications
- Design Specifications:
- Performance Specifications
Bullet points in “WHAT ARE CONTRACT RISKS TO AGENCY – Protect the agency “
- Proposal Risk
- Surety/Liability Risk
- Schedule Risk
- Contractual Risk –
- Performance Risk
- Price Risk
Bullet points of “CONTRACT TYPE”
Supplies/Goods
Capital Outlay
Professional Services
Non-Professional Services
Software
Lease
Construction
One-time goods purchase
Bullet points in “Special Terms And Conditions Of Resulting Contract eliminate Risks”
- Who are responsible for what?
- Change order procedure
- Key Personnel (Roles, who will be involved, who is in charge)
- Warranties
- Acceptance
- Payment
