This document discusses effective contract management in construction projects. It begins with an abstract discussing how organizations have prioritized cost savings and adopted more formal contract management procedures. It then discusses an introduction to contracts according to Indian law and defines contract management. The document outlines problems with contract management. It states the objective is to implement effective contract management to avoid problems and improve organizational profits. It reviews literature on contract management and discusses the contract management lifecycle. It also outlines contract management issues, components of effective contract management, factors affecting success, critical success factors, and experimentation with essential tools. The document discusses risk management, performance management, relationship management, change management, and service delivery management in contract oversight. It outlines key parameters including risk management and
The power point presentation describes about the Procurement- Contract Management in detail. Some important points are covered here that will help you know, why contract management is necessary.
The document discusses establishing a proactive procurement system. It advocates considering procurement as a system rather than just a department. A proactive procurement system focuses on obtaining the right quality and quantity of goods at the right time and place, at a reasonable price, considering the whole life cost and focusing on better value for money. It outlines key elements of an effective procurement system including developing strategic business plans, qualified procurement staff, strong supplier relationships, clear priorities and available resources, and competitive procurement policies. The overall goal is to achieve better value for money through a systematic approach to procurement.
A procurement management plan is a blueprint that maps out a strategy for analyzing and improving the procurement process. It identifies areas that need improvement in the supply chain. Creating a solid procurement plan requires analyzing total purchasing costs, measuring key indicators, negotiating supplier contracts, and implementing best practices. Consulting services can help companies conduct a procurement gap analysis and develop an individualized plan to improve efficiency and cut costs.
Strategic Cost Management – A Profitability Tool, Bp, Fla, November 20, 2010Barrett Peterson
This document summarizes a presentation given to the Finance Leaders Association on strategic cost management. It discusses various global economic and political drivers that impact strategic costs, such as commodity prices, trade agreements, and banking regulations. It also outlines considerations for current strategic costs, such as healthcare reforms, deficit reduction proposals, and trade discussions. Finally, it discusses the role of strategic cost management in impacted decisions regarding product design and distribution channel choices.
Agreement between investors or owners of a project, and a management company hired for coordinating and overseeing a contract”.
A business or an organization will hire a management company to perform specific tasks. Your organization might hire a management company to look after its marketing and under the contract, the management company would perform marketing on your company’s behalf and receive a fee for doing so.
The compensation for the management might be decided based on performance or it can be a set sum decided between you are the management company.
Project Management For Good Procurement Practicestjcornish
The document discusses project management best practices for procurement. It covers understanding procurement in light of project management, developing user requirement specifications, vendor management, and quality-based selection of vendors. Key topics include the difference between direct and indirect procurement, engineering economics concepts, requirements gathering techniques, contract types, solicitation planning, vendor selection methods, and quality-based selection of consulting engineers.
Post Award Contract Management for IT Suppliers v1.0 20200701Peter Soetevent
1. Contract management involves managing a contract throughout its life to ensure both parties meet their obligations and objectives. It aims to achieve value for money through optimizing efficiency, effectiveness and economy while balancing costs and risks.
2. Key aspects of contract management include agreed service levels, pricing, incentives, communication procedures, and an exit strategy. The lifecycle begins with setting objectives, identifying needs, acquiring services, and transitioning to contract management with ongoing analysis of needs.
3. Different types of contracts require varying levels of management. Routine contracts are low value and low risk while strategic contracts are high value, complex, and high risk, requiring formal risk assessment and management.
Cost-benefit analysis is used to determine if a planned action will have positive or negative outcomes. It quantifies all the benefits and costs to calculate the net impact. Some key applications include deciding whether to hire additional staff, purchase new equipment, or invest cash. A proper cost-benefit analysis involves identifying and monetizing all relevant costs and benefits to help make efficient decisions.
The power point presentation describes about the Procurement- Contract Management in detail. Some important points are covered here that will help you know, why contract management is necessary.
The document discusses establishing a proactive procurement system. It advocates considering procurement as a system rather than just a department. A proactive procurement system focuses on obtaining the right quality and quantity of goods at the right time and place, at a reasonable price, considering the whole life cost and focusing on better value for money. It outlines key elements of an effective procurement system including developing strategic business plans, qualified procurement staff, strong supplier relationships, clear priorities and available resources, and competitive procurement policies. The overall goal is to achieve better value for money through a systematic approach to procurement.
A procurement management plan is a blueprint that maps out a strategy for analyzing and improving the procurement process. It identifies areas that need improvement in the supply chain. Creating a solid procurement plan requires analyzing total purchasing costs, measuring key indicators, negotiating supplier contracts, and implementing best practices. Consulting services can help companies conduct a procurement gap analysis and develop an individualized plan to improve efficiency and cut costs.
Strategic Cost Management – A Profitability Tool, Bp, Fla, November 20, 2010Barrett Peterson
This document summarizes a presentation given to the Finance Leaders Association on strategic cost management. It discusses various global economic and political drivers that impact strategic costs, such as commodity prices, trade agreements, and banking regulations. It also outlines considerations for current strategic costs, such as healthcare reforms, deficit reduction proposals, and trade discussions. Finally, it discusses the role of strategic cost management in impacted decisions regarding product design and distribution channel choices.
Agreement between investors or owners of a project, and a management company hired for coordinating and overseeing a contract”.
A business or an organization will hire a management company to perform specific tasks. Your organization might hire a management company to look after its marketing and under the contract, the management company would perform marketing on your company’s behalf and receive a fee for doing so.
The compensation for the management might be decided based on performance or it can be a set sum decided between you are the management company.
Project Management For Good Procurement Practicestjcornish
The document discusses project management best practices for procurement. It covers understanding procurement in light of project management, developing user requirement specifications, vendor management, and quality-based selection of vendors. Key topics include the difference between direct and indirect procurement, engineering economics concepts, requirements gathering techniques, contract types, solicitation planning, vendor selection methods, and quality-based selection of consulting engineers.
Post Award Contract Management for IT Suppliers v1.0 20200701Peter Soetevent
1. Contract management involves managing a contract throughout its life to ensure both parties meet their obligations and objectives. It aims to achieve value for money through optimizing efficiency, effectiveness and economy while balancing costs and risks.
2. Key aspects of contract management include agreed service levels, pricing, incentives, communication procedures, and an exit strategy. The lifecycle begins with setting objectives, identifying needs, acquiring services, and transitioning to contract management with ongoing analysis of needs.
3. Different types of contracts require varying levels of management. Routine contracts are low value and low risk while strategic contracts are high value, complex, and high risk, requiring formal risk assessment and management.
Cost-benefit analysis is used to determine if a planned action will have positive or negative outcomes. It quantifies all the benefits and costs to calculate the net impact. Some key applications include deciding whether to hire additional staff, purchase new equipment, or invest cash. A proper cost-benefit analysis involves identifying and monetizing all relevant costs and benefits to help make efficient decisions.
Chapter 18 Contract and Relationship ManagementTran Thang
Need For Better Contract Management
Pre-award Conference
Monitoring And Controlling Project Progress
Gantt Charts
CPM And PERT
Closed Loop MRP Systems
Monitoring And Controlling Total Supplier Performance
Supplier Performance Evaluation
Motivation
Punishment
Rewards
Assistance
Training
Quality Audits And Procurement System Reviews
Problem Solving
Collaboration
Managing The Relationship
This document discusses the four main processes involved in project procurement management: plan procurement, conduct procurement, administer procurement, and close procurement.
It provides details on the inputs, tools and techniques, and outputs for each process. For plan procurement, it describes making make-or-buy decisions and developing procurement documents. Conduct procurement involves selecting sellers and awarding contracts. Administer procurement is managing contract performance through inspections, payments, and change requests. Close procurement completes each project procurement.
Core presentation for MSC Business Improvement: Improving strategic
procurement & SCM risk management. 26 November 2009
This e-mail may include confidential information and is solely for the use by the intended recipient(s). If you have received this e-mail in error please notify the sender immediately. You must not disclose, copy, distribute or retain any part of the email message or attachments. Views and opinions expressed by the author are not necessarily those of the organisation.
This email has been checked for known viruses and is believed to be virus free.
Strategic cost management requires understanding what customers want and will pay for, as well as the costs to provide products and services. Managers need integrated information systems focused on the future rather than just reporting past results. Traditional accounting is not sufficient and most important information is non-financial. Cost management is most effective early in development as 85% of costs are committed at that stage. All parts of the value chain from suppliers to customers must be managed for effective cost control.
This document discusses contract management. It defines a contract and contract management, and outlines the key elements and lifecycle of effective contract management. These include planning, performance monitoring, relationship management, governance, knowledge management, change management, contingency planning, and ongoing review. Issues at each stage of the contract management lifecycle are also examined, from procurement to closure. The document emphasizes that contract management aims to ensure all parties fully meet obligations to satisfy operational objectives and strategic goals.
The document discusses strategic cost management (SCM) as an important tool for gaining competitive advantage. SCM analyzes costs in the broader context of a firm's overall value chain. It helps firms understand their cost structures to develop superior strategies. SCM uses tools like value chain analysis, activity-based costing, and analysis of cost drivers to examine how firms can configure activities to reduce costs or pursue different competitive strategies like cost leadership or differentiation.
Procedure for purchasing, purchasing orders, and selection of suppliersQusi Alqarqaz
The purpose of this procedure is to ensure, evaluate and select suppliers of materials on their ability to fulfill specific contract requirements, procurement, communication of adequate details of requirements to the supplier and receiving inspection and verification of purchased products.
This document discusses value chain analysis, which was first proposed by Michael Porter in 1985. It involves identifying a firm's primary and support activities that add value to its products or services and analyzing them to reduce costs or increase differentiation. The key stages of value chain analysis for strategic cost management are identifying activities, establishing their costs and importance, comparing costs, identifying cost drivers, and finding opportunities to reduce costs or improve value through internal and external linkages. This allows firms to assess their competitive positioning and strategically improve quality, reduce time and costs, and increase benefits for both the firm and partners in the value chain.
The document discusses evaluation of purchase management performance. It outlines various quantitative and qualitative metrics that can be used, including price advantage, inventory levels, and relations with suppliers. Internal and external agencies can evaluate performance. Methods include forms, flowcharts, checklists and key performance ratios. A purchase audit examines the organization, policies, procedures, evaluation and reporting of the purchase department.
This document discusses project procurement management. It defines procurement management as the processes used to purchase or acquire resources from outside the project team. There are four key processes: plan procurements, conduct procurements, administer procurements, and close procurements. The document outlines these processes and provides details on procurement planning, contract types, procurement documents, negotiation tactics, and key procurement terms.
Project Procurement Management_Taipei101Hungyu Lai
Project Procurement Management, 2015 Fall
A procurement management plan based on the assumption of the Taipei101 case
Planned and Presented in UCI PM class
Prateek Kumar has over 7 years of experience in procurement and supply chain management. He believes procurement is key to a company's success by leveraging purchasing power and supply chains. Procurement management involves systematically sourcing all goods and services needed by a company. It identifies needs, qualifies suppliers, requests proposals, negotiates contracts, ensures delivery, and analyzes results. Managing procurement well saves time and money while meeting business goals and stakeholder expectations. The document outlines responsibilities like planning procurement policies, aligning skilled teams, procuring through tender processes, managing benchmarks and reporting, and enjoying the impact of streamlined procurement.
Pgpm13 project procurement and materialssakariya88
This document is a manual on procurement of materials for a construction firm. It covers factors to consider for purchasing such as technical specifications, approved budget cost, and market prices. It also discusses selecting suppliers based on value, quality, reliability and service. The manual provides guidance on bidding documents, evaluating offers, and finalizing purchases. It stresses developing clear purchasing policies and procedures to guide procurement activities in a strategic, compliant manner.
Strategic cost management is a program that businesses use to regularly identify and analyze cost drivers to lower costs and maximize value. It allows businesses to not only lower costs but gain a competitive advantage. Strategic cost management involves creating a strategic plan, prioritizing operations, and ensuring efficient use of resources. Once implemented, it brings transparency to costs and allows managers to make timely cost decisions. It can also show which customers are most or least profitable. The framework includes core functions, value-adding activities, and support activities. Effective strategic cost management requires support from top management, integrated information systems, and cross-functional teams.
TYPES OF PURCHASING SYSTEM
WHAT IS A PURCHASING SYSTEM?
FUNCTIONS OF PURCHASE DEPARTMENT
SUBCONTRACTING
TENDER
BLANKET ORDER
CAPITAL EQUIPMENT PURCHASE
PETTY CASH SYSTEM
IMPORTS
E-PURCHASING
ORDER ON TELEPHONE
RATE CONTRACT METHOD
STOCKLESS PURCHASING
Outsourcing: A Growth Industry
Strategic Issues
Core Competencies
Supplier Dominance
The Creation of Strategic Vulnerabilities
The Dangers of Vertical Integration
Horizontal Integration
New Product Development and Outsourcing
Lean Manufacturing
Tactical Decisions
Factors Influencing Make-or-Buy Decisions
Cost Considerations
Time
Capacity
Control of Production and Quality
Business Process Outsourcing
Technology Risk and Maturity
Unreliable Suppliers
Suppliers’ Specialized Knowledge and Research
Small-Volume Requirements
Limited Facilities
Factors Influencing Make-or-Buy Decisions
Cost Considerations
Time
Capacity
Control of Production and Quality
Business Process Outsourcing
Technology Risk and Maturity
Unreliable Suppliers
Suppliers’ Specialized Knowledge and Research
Small-Volume Requirements
Limited Facilities
Factors Continued
Work Force Stability
Multiple-Source Policy
Managerial and Control Considerations
Procurement and Inventory Considerations
Netsourcing
The Volatile Nature of the Make-or-Buy Situation
Dangers of Outsourcing
Administration of Make-or-Buy Activities
Chief Resource Officer
Framework for Outsourcing
Executive Level Involvement
Chapter 20 Production and Inventory ControlTran Thang
The Fundamentals of Production Planning
Modern Production Planning Systems
Aggregate Planning and Master Scheduling
Material Requirements Planning
Capacity Requirements Planning
Evolution of MRP and MRP II Systems
Impact on Purchasing and Supply
Just-In-Time Production Planning
The Functions of Inventories
Definition of Inventories
Inventory Analysis
Costs Associated with Inventories
Carrying Costs
Acquisition Costs
Economic Order Quantity
Types of Inventory Control Systems
Cyclical or Fixed Order Interval System
The Just-In-Time (JIT) Approach
Material Requirements Planning (MRP) System
Order Point or Fixed Order Quantity System
Indirect Procurement - Mr. Ashwani Singh (Watson Pharma)ELSCC
Indirect procurement is the sourcing of all goods and services for a business that enable its activity. It is a slow, technology intensive process requiring change management across the organization boundaries.
The document discusses strategic cost management, cost reduction, and value engineering. It defines strategic cost management as using cost information to develop superior strategies. It describes cost reduction as permanently lowering unit costs without compromising quality or suitability. Value engineering is defined as systematically analyzing functions to explore ways to improve performance and increase the value of products and services.
Managing risk is an integral part of good management practice and an essential element of good
corporate governance. It is something many managers do already in one form or another but when
undertaken effectively across an organisation it enables continuous improvement in decision-making
and facilitates continuous improvement in performance. The objective of risk management is to
identify and analyse risks and manage their consequences. Organisations which manage risks
effectively and efficiently are more likely to achieve their objectives at a lower overall cost.
This project risk management guideline aims to provide those responsible for managing project risks
with a common source of risk terminology and definitions. It aims to provide practical guidance on
how to implement and apply risk management in a project management context.
This document discusses the value of applying risk management to projects. It outlines how risk management can improve project delivery by providing better estimates, schedules, and project controls. It also improves communication and transparency. Applying quantitative risk analysis allows for more accurate project contingencies, which supports better capital planning. Risk workshops provide early risk identification and collaborative problem solving. Implementing a risk management process gradually and tailoring it to each project provides the most value. An independent risk analyst can help identify challenges and establish a standard process.
Chapter 18 Contract and Relationship ManagementTran Thang
Need For Better Contract Management
Pre-award Conference
Monitoring And Controlling Project Progress
Gantt Charts
CPM And PERT
Closed Loop MRP Systems
Monitoring And Controlling Total Supplier Performance
Supplier Performance Evaluation
Motivation
Punishment
Rewards
Assistance
Training
Quality Audits And Procurement System Reviews
Problem Solving
Collaboration
Managing The Relationship
This document discusses the four main processes involved in project procurement management: plan procurement, conduct procurement, administer procurement, and close procurement.
It provides details on the inputs, tools and techniques, and outputs for each process. For plan procurement, it describes making make-or-buy decisions and developing procurement documents. Conduct procurement involves selecting sellers and awarding contracts. Administer procurement is managing contract performance through inspections, payments, and change requests. Close procurement completes each project procurement.
Core presentation for MSC Business Improvement: Improving strategic
procurement & SCM risk management. 26 November 2009
This e-mail may include confidential information and is solely for the use by the intended recipient(s). If you have received this e-mail in error please notify the sender immediately. You must not disclose, copy, distribute or retain any part of the email message or attachments. Views and opinions expressed by the author are not necessarily those of the organisation.
This email has been checked for known viruses and is believed to be virus free.
Strategic cost management requires understanding what customers want and will pay for, as well as the costs to provide products and services. Managers need integrated information systems focused on the future rather than just reporting past results. Traditional accounting is not sufficient and most important information is non-financial. Cost management is most effective early in development as 85% of costs are committed at that stage. All parts of the value chain from suppliers to customers must be managed for effective cost control.
This document discusses contract management. It defines a contract and contract management, and outlines the key elements and lifecycle of effective contract management. These include planning, performance monitoring, relationship management, governance, knowledge management, change management, contingency planning, and ongoing review. Issues at each stage of the contract management lifecycle are also examined, from procurement to closure. The document emphasizes that contract management aims to ensure all parties fully meet obligations to satisfy operational objectives and strategic goals.
The document discusses strategic cost management (SCM) as an important tool for gaining competitive advantage. SCM analyzes costs in the broader context of a firm's overall value chain. It helps firms understand their cost structures to develop superior strategies. SCM uses tools like value chain analysis, activity-based costing, and analysis of cost drivers to examine how firms can configure activities to reduce costs or pursue different competitive strategies like cost leadership or differentiation.
Procedure for purchasing, purchasing orders, and selection of suppliersQusi Alqarqaz
The purpose of this procedure is to ensure, evaluate and select suppliers of materials on their ability to fulfill specific contract requirements, procurement, communication of adequate details of requirements to the supplier and receiving inspection and verification of purchased products.
This document discusses value chain analysis, which was first proposed by Michael Porter in 1985. It involves identifying a firm's primary and support activities that add value to its products or services and analyzing them to reduce costs or increase differentiation. The key stages of value chain analysis for strategic cost management are identifying activities, establishing their costs and importance, comparing costs, identifying cost drivers, and finding opportunities to reduce costs or improve value through internal and external linkages. This allows firms to assess their competitive positioning and strategically improve quality, reduce time and costs, and increase benefits for both the firm and partners in the value chain.
The document discusses evaluation of purchase management performance. It outlines various quantitative and qualitative metrics that can be used, including price advantage, inventory levels, and relations with suppliers. Internal and external agencies can evaluate performance. Methods include forms, flowcharts, checklists and key performance ratios. A purchase audit examines the organization, policies, procedures, evaluation and reporting of the purchase department.
This document discusses project procurement management. It defines procurement management as the processes used to purchase or acquire resources from outside the project team. There are four key processes: plan procurements, conduct procurements, administer procurements, and close procurements. The document outlines these processes and provides details on procurement planning, contract types, procurement documents, negotiation tactics, and key procurement terms.
Project Procurement Management_Taipei101Hungyu Lai
Project Procurement Management, 2015 Fall
A procurement management plan based on the assumption of the Taipei101 case
Planned and Presented in UCI PM class
Prateek Kumar has over 7 years of experience in procurement and supply chain management. He believes procurement is key to a company's success by leveraging purchasing power and supply chains. Procurement management involves systematically sourcing all goods and services needed by a company. It identifies needs, qualifies suppliers, requests proposals, negotiates contracts, ensures delivery, and analyzes results. Managing procurement well saves time and money while meeting business goals and stakeholder expectations. The document outlines responsibilities like planning procurement policies, aligning skilled teams, procuring through tender processes, managing benchmarks and reporting, and enjoying the impact of streamlined procurement.
Pgpm13 project procurement and materialssakariya88
This document is a manual on procurement of materials for a construction firm. It covers factors to consider for purchasing such as technical specifications, approved budget cost, and market prices. It also discusses selecting suppliers based on value, quality, reliability and service. The manual provides guidance on bidding documents, evaluating offers, and finalizing purchases. It stresses developing clear purchasing policies and procedures to guide procurement activities in a strategic, compliant manner.
Strategic cost management is a program that businesses use to regularly identify and analyze cost drivers to lower costs and maximize value. It allows businesses to not only lower costs but gain a competitive advantage. Strategic cost management involves creating a strategic plan, prioritizing operations, and ensuring efficient use of resources. Once implemented, it brings transparency to costs and allows managers to make timely cost decisions. It can also show which customers are most or least profitable. The framework includes core functions, value-adding activities, and support activities. Effective strategic cost management requires support from top management, integrated information systems, and cross-functional teams.
TYPES OF PURCHASING SYSTEM
WHAT IS A PURCHASING SYSTEM?
FUNCTIONS OF PURCHASE DEPARTMENT
SUBCONTRACTING
TENDER
BLANKET ORDER
CAPITAL EQUIPMENT PURCHASE
PETTY CASH SYSTEM
IMPORTS
E-PURCHASING
ORDER ON TELEPHONE
RATE CONTRACT METHOD
STOCKLESS PURCHASING
Outsourcing: A Growth Industry
Strategic Issues
Core Competencies
Supplier Dominance
The Creation of Strategic Vulnerabilities
The Dangers of Vertical Integration
Horizontal Integration
New Product Development and Outsourcing
Lean Manufacturing
Tactical Decisions
Factors Influencing Make-or-Buy Decisions
Cost Considerations
Time
Capacity
Control of Production and Quality
Business Process Outsourcing
Technology Risk and Maturity
Unreliable Suppliers
Suppliers’ Specialized Knowledge and Research
Small-Volume Requirements
Limited Facilities
Factors Influencing Make-or-Buy Decisions
Cost Considerations
Time
Capacity
Control of Production and Quality
Business Process Outsourcing
Technology Risk and Maturity
Unreliable Suppliers
Suppliers’ Specialized Knowledge and Research
Small-Volume Requirements
Limited Facilities
Factors Continued
Work Force Stability
Multiple-Source Policy
Managerial and Control Considerations
Procurement and Inventory Considerations
Netsourcing
The Volatile Nature of the Make-or-Buy Situation
Dangers of Outsourcing
Administration of Make-or-Buy Activities
Chief Resource Officer
Framework for Outsourcing
Executive Level Involvement
Chapter 20 Production and Inventory ControlTran Thang
The Fundamentals of Production Planning
Modern Production Planning Systems
Aggregate Planning and Master Scheduling
Material Requirements Planning
Capacity Requirements Planning
Evolution of MRP and MRP II Systems
Impact on Purchasing and Supply
Just-In-Time Production Planning
The Functions of Inventories
Definition of Inventories
Inventory Analysis
Costs Associated with Inventories
Carrying Costs
Acquisition Costs
Economic Order Quantity
Types of Inventory Control Systems
Cyclical or Fixed Order Interval System
The Just-In-Time (JIT) Approach
Material Requirements Planning (MRP) System
Order Point or Fixed Order Quantity System
Indirect Procurement - Mr. Ashwani Singh (Watson Pharma)ELSCC
Indirect procurement is the sourcing of all goods and services for a business that enable its activity. It is a slow, technology intensive process requiring change management across the organization boundaries.
The document discusses strategic cost management, cost reduction, and value engineering. It defines strategic cost management as using cost information to develop superior strategies. It describes cost reduction as permanently lowering unit costs without compromising quality or suitability. Value engineering is defined as systematically analyzing functions to explore ways to improve performance and increase the value of products and services.
Managing risk is an integral part of good management practice and an essential element of good
corporate governance. It is something many managers do already in one form or another but when
undertaken effectively across an organisation it enables continuous improvement in decision-making
and facilitates continuous improvement in performance. The objective of risk management is to
identify and analyse risks and manage their consequences. Organisations which manage risks
effectively and efficiently are more likely to achieve their objectives at a lower overall cost.
This project risk management guideline aims to provide those responsible for managing project risks
with a common source of risk terminology and definitions. It aims to provide practical guidance on
how to implement and apply risk management in a project management context.
This document discusses the value of applying risk management to projects. It outlines how risk management can improve project delivery by providing better estimates, schedules, and project controls. It also improves communication and transparency. Applying quantitative risk analysis allows for more accurate project contingencies, which supports better capital planning. Risk workshops provide early risk identification and collaborative problem solving. Implementing a risk management process gradually and tailoring it to each project provides the most value. An independent risk analyst can help identify challenges and establish a standard process.
The document summarizes a masterclass on applying the risk management guide ISO/TR 31004:2013 for implementing ISO 31000. The masterclass aims to promote learning of cutting edge risk management practices and foster creative and collaborative thinking. It focuses on how to design a risk management framework according to ISO 31000 principles, integrate risk management into organizational processes and management systems, and ensure continual improvement.
5 Reasons Owners Specify Project-Wide Data Management - Webinar, March 2016Aconex
In this webinar, Chris Bunker of the UK’s Wellcome Trust and Mike Evans of Cambashi Research discussed why owners are increasingly adopting project-wide technology platforms for their projects. We also featured a live demo of Aconex to show how cross-organizational information management can streamline processes from design coordination to approval cycles and handover.
This document is a term paper submitted by Anu Damodaran to her faculty guide, Mr. C.T. Sunil, in partial completion of her MBA program at Amity University in Dubai. The paper is titled "To study ERM - A competitive edge for the company and how it adds value to its shareholders". The introduction provides background on enterprise risk management (ERM) and its importance for businesses facing various strategic, market, operational and financial risks. The paper will review literature on ERM and explore how companies can implement ERM through risk mapping and maturity models. It will also discuss the advantages, suitability and limitations of ERM for businesses.
This document provides an overview of risk management for a community project. It discusses risk management during the planning and implementation phases. In the planning phase, the key steps are identifying risks, assessing their likelihood and impact to create a risk register, and developing mitigation strategies. Major risk categories include delays, costs, quality, and safety. The implementation phase focuses on construction activities and risks associated with those like variations, resources, and approvals. Continuous monitoring and updating of the risk register is important. The overall goal is to have a structured process to identify, prioritize and control risks to help ensure project success.
This document provides information about an upcoming conference on managing risk in construction contracts and projects taking place on January 26-27, 2016 in Toronto. The conference will provide strategies for drafting precise contracts, allocating risk, ensuring appropriate insurance is in place, and more. Speakers will include lawyers, contractors, engineers, project managers and other professionals. Attendees can also choose to attend an additional half-day master class on drafting construction contracts or managing environmental and safety risks on projects. The event aims to help participants effectively plan for and manage risk in their construction contracts and projects.
Workshop project risk management (29 june 2012)bfriday
The document discusses project risk management tools used by Bronwyn Friday, the Group Manager of Risk at John Holland Group. It provides an overview of Bronwyn's background and experience in risk management. It then discusses tools and best practices for project risk management, including qualitative and quantitative risk assessment tools, risk registers, and risk identification methods like brainstorming workshops.
Construction Risk Summit "benefit and pits of Construction Risk Management"bfriday
This document discusses conducting risk management on major projects. It provides an overview of John Holland, an engineering and construction company, and explains why risk management is important for major projects. Some key benefits of risk management mentioned include focusing teams on objectives, protecting balance sheets, gaining alignment on critical risks, and understanding residual uncertainty. The document also outlines some pitfalls to avoid, such as not involving risk information in decision making. It emphasizes the importance of focusing on key risks and matching the appropriate risk tools to each project.
Exploration of risks and risk management in construction project deliveryMECandPMV
Risks are pervasive throughout construction projects and need to be properly managed. This document discusses:
1) Various types of risks that occur during different phases of the project life cycle from planning to construction.
2) How the selection of a project delivery system, such as design-bid-build or design-build, can impact risks related to costs, schedule and control.
3) Qualitative and quantitative risk analysis methods that can be used to identify, prioritize and evaluate risks, such as cause-and-effect diagrams and decision analysis.
This document provides a strategic risk management plan for Marriott Sprowston Manor Hotel. It identifies key risks facing the hotel, including financial risks from economic conditions, strategic risks from increased competition and reputation risks, and operational risks from technology issues and increasing costs. The plan develops an enterprise risk management framework using objectives, key concepts, and a process for implementation. It assigns roles and responsibilities and provides risk mitigation actions and a business continuity plan to manage risks and ensure the continuity of hotel operations.
Risk and uncertainty in construction projectsSameer Nawab
This document discusses risk and uncertainty in construction projects. It defines uncertainty as a lack of certainty involving variability and ambiguity, while risk can be quantified using probability distributions. Sources of uncertainty include unclear communication, unestimated work amounts, lack of management tools, and unclear responsibilities. The top 10 risks related to project objectives are listed as cost overruns, delays, quality issues, environmental impacts, and safety concerns. Risk management for construction projects involves planning, identification, analysis, response, and monitoring of risks over nine areas including scope, schedule, costs, quality, and communications. Managing both internal and external project risks is important for project success.
Enterprise risk management frameworks help organizations manage uncertainty and introduce strategic management frameworks to address risks. These include frameworks for corporate foresight, business planning, enterprise architecture, risk management, and performance management. Futures studies techniques like horizon scanning and analyzing drivers of change can provide insights to inform risk management and strategic decision making.
Construction Project Managment Techniquesguestc8140fe
The document provides an overview of project management and different project management techniques. It discusses what a project is and defines project management. It then summarizes different project management methods including critical path method (CPM) and Program Evaluation and Review Technique (PERT). CPM uses fixed time estimates while PERT allows for uncertainty in activity times. The document also outlines the basic steps for using CPM and PERT in project planning and management.
This document provides an overview of Cisco's proposed strategy to enter the smart city market. It discusses Cisco's mission, vision and objectives for its smart city initiatives. Some key points:
- Cisco's mission is to pioneer Internet of Everything (IoE) technologies to ensure citizen safety and increase energy efficiency in cities. Its vision is to be an industry leader in helping develop smart cities worldwide.
- Cisco sees opportunities to leverage its expertise in networking and partnerships to provide smart city solutions involving infrastructure, applications and technology. This could help cities improve services while reducing costs.
- The document outlines various strategies Cisco could take, such as expanding its partner network, acquiring emerging technology firms, and developing new business lines around smart
project on construction of house report.Hagi Sahib
The document provides details of a project to construct a house including the project charter, scope, schedule, and resources. The project has defined activities to construct the house over a 1 year period within a budget of Rs. 14,365,047. Key stakeholders include the customer Mr. Ali Hamza and supplier vendors. The project manager developed a work breakdown structure and activity list to plan and track the house construction.
Guide to Construction Procurement StrategiesSarah Fox
A guide to the three most common procurement strategies used on UK construction projects:
1. Traditional or general contracting
2. Design and build
3. Management based (covering management contracting, construction management and prime contracting).
Many construction professionals stick with what they know when choosing or recommending procurement, risk and contract strategies. However, making an informed choice can reduce the risk of conflict later. The comparison of the different strategies is partly based on Which Contract? By Cox, Clamp and Lupton.
This guide was developed by Sarah Fox, author of the 500-Word Contract. Using her 20 years' experience with construction projects, she gives you the confidence to use the right contracts for project success. The right contracts depend on the right procurement and risk strategies.
To find out more about her contract workshops, visit www.500words.co.uk or email sarah@500words.co.uk
The document discusses various aspects of project management. It begins by outlining the different stages of a project including planning and scheduling, data collection, status updates, and ensuring successful completion. It then defines what a project is, its key characteristics, and how project management applies knowledge and techniques to meet stakeholder needs and expectations. The document also discusses why companies and individuals use project management and what goes into a project management plan. It provides overviews of the project management process, process groups, knowledge areas, and integration management.
Commercial management in construction projects involves effective cost control, risk management, and successful project closeout. The main objective is balancing commercial competitiveness and profitability through financial processes that integrate with overall project delivery.
The role of a commercial manager includes tasks like contract administration, cost control, risk identification, and cash flow forecasting when working with contractors, consultants, and clients.
Reading lists for commercial management certification cover topics like estimating, cash flows, procurement, subcontract management, and financial reporting. Key skills include analytical thinking, communication, and managing costs, schedules, and relationships across the project team.
This document discusses key elements of effective contract management. It begins with defining what a contract is and explaining the contract management life cycle. It then discusses several important aspects of contract management including planning and information collection, contract administration, performance monitoring, relationship management, and issues that can arise at each stage of the contract management life cycle from procurement to closure. Effective contract management requires identifying risks, setting clear performance measures, maintaining strong communication between parties, and having dispute resolution procedures in place.
The document discusses outsourcing and vendor management. It begins by defining outsourcing and listing common reasons for outsourcing such as cost reduction, avoiding large investments, and focusing on core competencies. It then describes different types of outsourcing models including BPO, ITO, and APO. The document provides details on implementing outsourcing and managing vendors through strategies such as risk analysis, due diligence, documentation, and ongoing supervision. It also presents a case study on how Cisco established a global vendor management office to gain more value from suppliers.
Most sourcing organizations focus on direct procurement, potentially overlooking indirect procurement and missing key opportunities to reduce spend. As indirect purchases increasingly become a larger percentage of overall spend, for many organizations, indirect procurement can be a diamond in the rough. This article makes the arguement that the value of indirect procurement should not be overlooked.
This document discusses consultants, contracts, and quality in three sections. It describes what consultants do, where they work, why they are used, and the differences between consultants and contractors. It also outlines the stages of a typical consultant assignment. The second section covers contract law, the importance of contract management, and what should be included in a contract. The third section discusses the current focus on quality, methods like total quality management and ISO 9001 standards, and approaches to software quality management.
Life Cycle Costing Critical Evaluation ReportAnkur Aggarwal
Life Cycle Costing (LCC) is an important economic analysis used in the selection of alternatives that impact both pending and future costs. It compares initial investment options and identifies the least cost alternatives for a twenty year period.
[Project] FRAMEWORK FOR SUPPORTING “BUSINESS PROCESS REENGINEERING “-BASED BU...Biswadeep Ghosh Hazra
A short presentation on Business Process Re-engineering Based Models. It consists of Strategic, Project Management, Information Technology, Top Management and Cultural Factors. There are various models/frameworks and indicators like- Porters 5 Forces Model, 4 CSFs for BPR Implementation, From-to analysis, Financial Indicators.
On the 14th March 2014 the House of Commons committee on public accounts report "Contracting out public services to the private sector" was published, and makes uncomfortable reading for those involved as suppliers or procurers. It might be tempting to say this is the reality of the difficulties of delivering public services, and it might instead be the case that procuring services through contracts performs with great variability across all sectors commercial and public.
A conference was hosted by the APM Value Management SIG that looked at those issues in the face, entertained the notion that the solution is in the hands of project teams, from either side, client or supplier/contractor, and sought to prove that case, with both theory and evidence!
The event included the following speakers:
John Heathcote, APM Value Management SIG Chair
Alan Munro (keynote speaker)
Paul Riley, Head of Capital Projects, Leeds Metropolitan University Estates & Contractor partners BAM
John Phillips, BAM Director
Professor Farzad Khosrowshahi, Head of the School of the Built Environment & Engineering
The Contract And Procurement Management ProcessPamela Wright
The document discusses the procurement management process as it relates to project management. It describes the key aspects of contract and procurement management, including planning purchases and acquisitions, planning contracting, requesting seller responses, selecting sellers, and closing contracts. It also discusses tools that can be used in project procurement and contract management, such as make-or-buy analysis, independent cost estimates, request for information/quotation, and request for proposal. Finally, it examines the procurement management process as involving administrative, behavioral, and communication aspects to develop an effective procurement team and manage project procurement risk.
The biggest problems caused by suppliers and how to prevent themAli Zeeshan
The document discusses best practices for managing suppliers to prevent common problems, including conducting risk analysis and due diligence on potential suppliers, optimizing the number of suppliers worked with, ensuring contracts are properly operationalized, and ongoing governance of supplier performance through audits and metrics. It provides examples of supplier issues experienced by major companies and emphasizes the importance of reducing suppliers to a strategic few that can be more closely managed. The presentation also outlines a framework and maturity model for evaluating an organization's supplier management capabilities.
“Direct” Spend Management: Optimizing spend and increasing direct material av...Genpact Ltd
In the last few years since the Great Recession, organizations have attempted to optimize supply chain operations and position themselves for growth over the next 3-5 years. This includes tapping “low-hanging fruit” in the optimization journey, largely in the indirect sourcing transactional services such as logistics. Procuring “direct” material, however, seems to be a relatively untapped opportunity for organizations to continue optimizing their supply chains. Inevitably, companies can benefit significantly more by opting for an end-to-end framework rather than through incremental improvements to direct spend management processes.
The document discusses best practices for developing performance-based contracts to ensure mission success. It outlines key factors such as defining measurable outcomes, composing acquisition teams with cross-functional expertise, identifying opportunities through market research and component business modeling, carefully scoping the work, and planning for contingencies. Performance-based contracts that focus on outcomes rather than processes and encourage innovation can benefit both agencies and contractors.
The document discusses developing a budget for a CRM system project that accounts for 4 critical areas: payoff/ROI, risk, services, and technology choice. It emphasizes analyzing payoff potential, minimizing risks, fully accounting for needed services, and choosing the right technology to avoid wasted money. The summary also stresses the financial risks small businesses take on with CRM projects and the need for thorough pre-project planning.
Importance of early project requirements definitionMaveric Systems
This slideshow highlights the need to budget adequate time and resources to the requirements management process early in the project execution lifecycle and the importance of a mature requirements management process to ensure project success.
Study on Procurement Method Selection Procedure in Construction IndustryIRJET Journal
This document discusses procurement methods in the construction industry. It begins by defining procurement systems and their objectives, which include managing procurement effectively and controlling risks.
It then describes three main procurement methods: traditional, design-build, and management. Traditional involves separate design and construction contracts while design-build combines them. Management involves a contractor managing the project.
The document outlines factors that influence selecting a procurement method, such as the project characteristics, client needs, and external environment issues. It aims to help establish an effective procurement system in construction.
Learn how companies across industry verticals are leveraging ECLM to improve the creation, administration and assessment of contracts.
Our industry and ECLM solution experts cover the keys to addressing critical contracting issues such as:
Minimizing potential legal/resource bottlenecks
Increasing contract visibility of upcoming payment milestones for finance
Minimizing change controls and amendments by incorporating typical scope revisions into standard templates
We look at real customer implementation stories and hold an interactive Q&A to show how your organization can achieve a considerable ROI on an ECLM solution.
Regulatory Affairs Outsourcing Considerations and ModelsPaul Kuiken
I present a number of issues which are being considered by all organisations in the healthcare, pharmaceutical, biotechnology, and clinical sectors. I presented this to an audience at an outsourcing summit and have tailored this to a more general audience.
I am happy to receive your comments and provide your insights to whether you agree or not with my points or to hear from you regarding your experiences of outsourcing in whatever sector you are interested in.
The document discusses trends in outsourcing models moving from cost-focused to collaborative models that aim to provide business value and competitive advantage. It argues that traditional ticket-based pricing models do not incentivize quality, and that outsourcing providers should be responsible for ensuring defect-free applications and business outcomes rather than just fixing tickets. The document advocates for an outcome-based model where providers are paid based on achieving business metrics and key results rather than activities.
(1) The document discusses procurement processes and systems, including fraud risks. It describes the procurement cycle and key elements like purchase requisitions, purchase orders, and goods receipt.
(2) It outlines government initiatives in Malaysia to combat procurement fraud, such as establishing a central procurement body and implementing e-procurement. This has increased transparency.
(3) Automating procurement can support good governance and reduce corruption risks by integrating controls, segregating duties, and enabling transparency through e-procurement and audit trails. Workflow alerts and dashboards also improve oversight.
Contracting process paper cpmgt302september 21, 2015SONU61709
This patient presents with menopausal symptoms including hot flushing, night sweats, and genitourinary symptoms. She has a history of hypertension treated with Norvasc and HCTZ. Her blood pressure is elevated at her current visit.
I would recommend starting this patient on a low-dose estrogen therapy. Estrogen is first-line treatment for vasomotor symptoms of menopause like hot flashes and works by opposing declining estrogen levels. I would start with a low dose of conjugated equine estrogens 0.3mg orally daily to address her symptoms while minimizing risks. Her cardiovascular risk factors including family history of breast cancer warrant a low starting dose. I would also counsel continuing her current antihypertens
Contracting process paper cpmgt302september 21, 2015
ECM BY KP - Copy
1. BY
KRISHNA PRASAD JP
M.Tech, 2ND sem , CTM
ROLL NO : 151560
NATIONAL INSTITUTE OF TECHNOLOGY WARANGAL
EFFECTIVE CONTRACT MANAGEMENT
2. ABSTRACT
In today’s difficult and uncertain economic environment, organizations
have placed cost savings high on their agendas. The pressure from
organisations in both the public and private sector to reduce costs and
improve financial and operational performance have resulted in
recognition of significance of effective contract management which led to
adoption of more formal and structured contract management procedures
and increase in the availability of software applications.
However, without an ECM program savings will be captured but not
realised. The benefits of ECM do not end with cost savings. Also effective
contract management optimises the efficiency, effectiveness and economy
of the service or relationship described by the contract, balancing costs
against risks and actively managing the customer–provider relationship.
3. INTRODUCTION
According to Indian contract act, it is defined as an agreement which is enforceable by law. It creates legal
obligation between parties.
When it comes to construction, contracts are at the heart of everything the company does
Contract management: Contract management is the process that enables both parties to a contract to meet
their obligations in order to deliver the objectives required from the contract. It also involves building a good
working relationship between customer and provider.
4. PROBLEM STATEMENT
• Decisions are not taken at the proper time thus allowing potential risks to appear.
• The contractor executes the project based on the understanding that he has formulated
himself regarding the contract requirements, without realising the actual goals and results
expected from the execution of the project
• The project implementation described in the contract is underestimated by the contractor
both in terms of time and human resources required, leading eventually to deviations from
the initial planning and possibly to exceeding the initially estimated budget
• The project is implemented at a slow rate
• The opportunities to improve value for money are lost
• The handling of problems that arise during the execution of the contract is not conducted
timely and effectively, which usually leads to tension between the contracting authority and
the contractor
• Communication between the contracting authority and contractor is limited, increasing the
possibility for misunderstandings, misinterpretations and the drawing of incorrect
conclusions
• The contractor's performance is not evaluated throughout the execution of the contract
thus not allowing for actions to be taken to increase the performance and effectiveness of
the contract.
5. OBJECTIVE
• The objective of the study is to implement effective contract
management(ECM) in construction projects in order to avoid the above
quoted problems as well as to improve profits of the organisations and
to realize the same. Exploring the potential benefits of the available
softwares in market so as to implement ECM with ease.
7. Contract Management Issues
Procurement Stage
•Resourcing
•Planning & Development
•Developing Tools
•Integrate Management
aspects in the contract
•Key Performance
Indicators
• Defining Governance
Responsibilities
Execution Stage
•Managing Performance
•Managing Relationships
•Managing Changes
•Managing Contingencies
•Managing Documents and
records
•Executing Governance
Responsibilities
Service Delivery
• Managing Performance
• Managing Relationship
• Managing Changes
• Managing Contingencies
• Managing Documents and Records
• Delivering Governance
Responsibilities
8. Contract Management Issues
Contract Closure
• Managing Compliance
• Maintaining Relationships
• Documenting Changes
• Regularizing Contingencies
• Saving Documents for Asset
Management
• Informing the Management of
the closure
9. Components of ECM
Upstream activities: Preparing the business case and
securing management approval
Assembling the project team
Developing the contract strategy
Risk assessment
Developing contract exit strategy
Developing a contract management plan
Drafting specifications and requirements
Establishing the form of contract
Establishing the pre-qualification, qualification and
tendering procedures
Appraising suppliers
Drafting ITT documents
Evaluating tenders
Negotiation
Awarding the contract
Downstream award of
contract
Changes within the contract
Service delivery management
Relationship management
Contract administration
Assessment of risk
Purchasing organisation’s
performance and effectiveness
review
Contract closure
10. FACTORS AFFECTING SUCCESS OF ECM
ECM will be successful if
• the arrangements for service delivery continue to be satisfactory to both
parties, and the expected business benefits and value for money are being
realised.
• the expected business benefits and value for money are being achieved.
• the supplier is co-operative and responsive.
• the organisation understands its obligations under the contract.
• there are no disputes.
• there are no surprises.
• a professional and objective debate over changes and issues arising can be
had.
• efficiencies are being realised.
11. CRITICAL SUCCESS FACTORS (CSF’S)
• The right contract
• Single business focus
• Service delivery management and contract administration
• Relationship management
• Continuous improvement
• People, skills and continuity
• Knowledge
• Flexibility
• Change management
• Proactivity
• Flexibility
12. EXPERIMENTATION
ESSENTIAL TOOLS FOR ECM
Classification of Contracts
classifying the contracts strategy and execution plan for contracts
a contract with low sensitivity and low spend (i.e., “Frequent” contracts) will require only basic contract
management. This means that the organization’s focus for this contract should be on contract
administration and supplier performance. On the other hand, if an organization has outsourced activities
that are key to the organization’s daily operations (a “Tough” contract), then the organizations focus
should include contract administration, relationship management, risk migration, strategy, innovation and
development of the supplier
13. PARETO CHART
• A Pareto chart, also called a Pareto distribution diagram, is a vertical bar graph in which values are plotted in
decreasing order of relative frequency from left to right. Pareto charts are extremely useful for analyzing
what problems need attention first because the taller bars on the chart, which represent frequency, clearly
illustrate which variables have the greatest cumulative effect on a given system.
• The Pareto chart provides a graphic depiction of the Pareto principle, a theory maintaining that 80% of the
output in a given situation or system is produced by 20% of the input.
• 80 percent of problems come from 20 percent of causes
The Pareto chart is one of the seven basic tools of
quality control. The independent variables on the
chart are shown on the horizontal axis and the
dependent variables are portrayed as the heights of
bars.
14. ABC ANALYSIS
• Inventory optimization is critical in order to keep costs under control within the supply chain.
• ABC analysis is an inventory categorization method which consists in dividing items into three categories, A, B
and C: A being the most valuable items, C being the least valuable ones. This method aims to draw managers’
attention on the critical few (A-items) and not on the trivial many (C-items).
A-items are goods which annual consumption value is
the highest. The top 70-80% of the annual
consumption value of the company typically accounts
for only 10-20% of total inventory items. (tightly
control)
B-items are the interclass items, with a medium
consumption value. Those 15-25% of annual
consumption value typically accounts for 30% of total
inventory items.(moderately control)
C-items are, on the contrary, items with the lowest
consumption value. The lower 5% of the annual
consumption value typically accounts for 50% of total
inventory items. (negligible)
15. KRALJIC PORTFOLIO PURCHASING MODEL
The model involves four steps:
• Purchase classification.
• Market analysis.
• Strategic positioning.
• Action planning.
Purchase classification
Strategic items (high profit impact, high supply risk).
These items deserve the most attention from purchasing managers.
Options include developing long-term supply relationships, analyzing and
managing risks regularly, planning for contingencies, and considering
making the item in-house rather than buying it, if appropriate.
Note that step 3, below, provides detailed options for the best purchasing
approach for these items, after considering other factors.
Leverage items (high profit impact, low supply risk).
Purchasing approaches to consider here include using your full purchasing
power, substituting products or suppliers, and placing high-volume orders.
Bottleneck items (low profit impact, high supply risk).
Useful approaches here include over ordering when the item is available
(lack of reliable availability is one of the most common reasons that
supply is unreliable), and looking for ways to control vendors
Non-critical items (low profit impact, low supply risk).
Purchasing approaches for these items include using standardized
products, monitoring and/or optimizing order volume, and optimizing
inventory levels.product purchasing classification
matrix
16. MARKET ANALYSIS
Here, you investigate how much power your suppliers have, and how much buying power you have as their
customer. A good way of doing this is to use Porter's Five Forces analysis.
STRATEGIC POSITIONING Exploit – Make the most of your high buying power
to secure good prices and long-term contracts from a
number of suppliers, so that you can reduce the
supply risk involved in these important items. You
may also be able to make "spot purchases" of
individual batches of the item, if a particular supplier
offers you a good deal.
Balance – Take a middle path between the
exploitation approach and the diversification.
Diversify – Reduce the supply risks by seeking
alternative suppliers or alternative products.
ACTION PLANS
Finally, develop action plans for each of the products and materials you need on a regular basis according to
where those items are placed in the Purchasing Portfolio Matrix.
17. KEY PARAMETERS FOR ECM
RISK MANAGEMENT
Risk is defined as the chance of Something happening that will have an adverse impact upon objectives . It is
measured in terms of consequence and likelihood.
overview of the risk management
process
A systematic methodology for identifying, assessing, treating and
monitoring risks is a must in order to have ECM , the risk
management process should be applied to each step of the contract
management lifecycle. A comprehensive approach to risk
management considers risk treatments both actively (designing and
implementing controls to prevent the risk events occurring) and re-
actively (to mitigate the consequences should the risk events actually
occur).
Risk management, through structured decision making and a
comprehensive analysis of business processes, provides opportunities
for innovation and enhanced outcomes.
18. STEP ONE: ESTABLISH CONTEXT
ensuring the contract is understood, by all parties, in the overall context of the organisation , that is:
• the outputs that the contracted services support;
• the critical success factors to the delivery of the outputs; and
• the internal input necessary for the delivery of the outputs.
STEP TWO: ASSESS RISKS
In this step the organisation needs to:
• identify all non-trivial business risks (risk identification);
• analyse those risks (risk analysis); and
• design treatments that reduce the risks to an acceptable level (risk treatment design).
RISK IDENTIFICATION
There are at least two levels of risk associated with contracted service delivery:
• contract risk—the risk associated with the delivery of the service; and
• contract management risk—the risk associated with the management of the contract.
RISK ANALYSIS
Once the organisation has identified the contract risks, they need to be analysed.
The criteria should be established on an escalating scale (low to high risk) against which the impact can be
assessed.
RISK TREATMENT DESIGN
The final step in risk assessment is to design appropriate risk treatments for the identified risks. The treatment
options available to an organisation range from accepting the risk (where it cannot otherwise be cost-effectively
managed), controlling the risk, through to transferring at least some of the risk
19.
20. outline of the risk assessment phase of the risk management
process
STEP THREE: IMPLEMENT TREATMENTS
This requires organisations to establish a plan
for implementing any new treatments,
additional controls, or modifications to existing
controls arising from the risk assessment
phase. The implementation plan should
address contract risk management policies and
procedures if they do not already exist.
STEP FOUR: MONITOR AND REVIEW
The objective of the final step in the risk
management process is to monitor the risks
and the effectiveness of the controls over time
to ensure changing circumstances do not alter
risk priorities or weaken the operation of
controls.
21. THE APPLICATION OF RISK TO CONTRACT MANAGEMENT:Risks associated with the transition phase,
ongoing management, and succession phases of the contract management lifecycle should be considered against
the various steps in the framework for risk management.
22. PERFORMANCE MANAGEMENT
• It is a systematic approach which improves the goals through an ongoing process of establishing strategic
performance objectives ,measuring performance ,collecting ,analysing ,reviewing and reporting performance
data.
Measure: it involves defining necessary
perspectives for performance management
based on the balanced scorecard (BSC)
concept, and setting the objectives of
performance. after this step, it deducts success
factors, sets the target of performance and
measures the data with assessment of
measurable index.
Store: it is a step where loading of
performance data into data warehouse takes
place .it defines fact table and dimension table
former contain measured data latter contains
descriptive information about fact and it sets
link for every table.
23. Analyse: it is a step where multi-dimensional analysis applying OLAP with performance and related stored
data in DW takes place.
Report: it is a phase of creating appropriate pages from result of previous step using table and picture.
information will be analysed by user through interaction with system and it displays its report to screen.
Use: this is used for problem solving and decision making with analysed data.
RELATIONSHIP MANAGEMENT
A successful relationship must involve the delivery of services that meet requirements. The commercial
arrangement must be acceptable to both parties – offering value for money for the customer and
adequate profit for the provider.
The three key factors for success are:
• mutual trust and understanding
• openness and excellent communications
• a joint approach to managing delivery.
There must be mutual trust between customer and provider if the relationship is to work
24. Establishing relationship management structures
Senior Management Support; Peer to Peer communication; separation of roles; Defined roles and
responsibilities; escalation paths
Understanding one another
Objectives and expectations; future plan and directions; concerns about wider relationship; Opinion surveys
Establishing and using communication channels
Formal and informal contact points; horizontal and vertical communications; documenting verbal
communication
Relationship management and succession planning
Monitoring the Relationship
25. CHANGE MANAGEMENT
• Changes are almost inevitable during the period of a contract, particularly in the case of large, complex
construction and service contracts.
• During the lifecycle of any project, it is likely that a number of changes will occur, requiring proper
management.
• Changes may be contemplated at the time of procurement and provided for in the contract, or not
contemplated during procurement but seen as desirable or necessary alterations to services or the contract.
• Good change management processes incorporate the following features:
– Appropriate protocols are in place to manage change
– Appropriate staff have the authority to request and authorise changes
– Potential changes are assessed thoroughly by suitably experienced personnel, having consulted with all
relevant stakeholders
– Changes are appropriately prioritised and their implementation is properly resourced
– The implementation of changes is controlled and tested
– Changes are appropriately documented
– Changes do not compromise value for money outcomes
26. SERVICE DELIVERY MANAGEMENT
• This activity is concerned with the fundamental aspect of contract management, that of ensuring that the
actual service provided by the supplier is in accordance with the agreed standards and prices. The ability to
measure the performance of the supplier – sometimes called vendor rating - and to provide feedback is
critical to successful contract management and supplier development.
27. POTENTIAL BENEFITS OF AVAILABLE SOFTWARES
List
1. EasyBuild
2. Eque2 EVision
3. Explorer Eclipse
4. GenieBelt
5. Goldenseal by Turtle Creek Software
6. INAXUS
7. Jonas Premier
8. Knowify
9. Pro DBX
10. RENOMii
28. EasyBuild
EasyBuild is a construction ERP solution
that can easily oversee construction
projects from end-to-end. On the contract
end, EasyBuild offers a customer
relationship management (CRM) and
document management module built right
into the system, so that workers can attach
notes and contracts with clients. The
construction software also allows
subcontractor document management.
Each of these contract management
systems are easily searchable; you won’t
ever lose your contracts in your sea of
contacts.
Pros: Document scanning software, high-quality debtor reporting, and the software acts as a
complete end-to-end solution.
Cons: Only runs on Windows, only available in English, and a limited number of reviews, so there
isn’t a lot of customer feedback for this software just yet.
Price: Starts at £1,750 (about $2,500) per license.
29. Eque2 EVision
EVision bills itself as construction accounting software, but it’s much
more than that. The product is based off of Microsoft Dynamics NAV,
Microsoft’s ERP system for small and mid-sized businesses, so it
integrates with all of your Microsoft products. One cool feature that
EVision offers is embedded reporting. I talked with Chloe Leigh,
EVision’s marketing director, who explained, “Embedded Excel reporting
tools allow you to create and deliver reports in your own format and are
directly linked to source data.” For construction companies with lots of
interconnected data that are tied to contracts, this organizational tool
definitely stands out.
Pros: The whole system covers everything from project management to cost control. Users can easily run
reports and find out which contracts affect the operational and financial health of their construction company.
Cons: Pricey, to the point where small and midsize companies may do better with a cheaper option.
Price: Starts at £50,000 (about $72,000).
30. Explorer Eclipse
Explorer Software document
management of this construction
management software is excellent. The
end result is pretty cool; documents are
tagged with Optical Character
Recognition(OCR) and GPS tagging so
users can tag, file, store, and find
important documents easily—regardless
of if they were initially electronic or not.
As an important addition feature, when
documents are updated, all related items
are updated as well. Explorer Software is
an awesome option for heavy
construction, general contractors,
specialty contractors, sub-trades,
architects, and engineers.
Pros: Full ERP solution; Explorer Software doesn’t rely on plugins to function well.Outstanding customer service and
in-depth reporting features.
Cons: Requires an extra spend for the document manager and business analytics units. Website is incredibly
opaque to new buyers looking for information.
Price: Starts at $19,000 and scales with the number of users and units.
31. GenieBelt
GenieBelt stands out as a personal favorite of
mine because they have a free version, are
extraordinarily easy to use, are consistent in
offering high-quality customer support, and
are hell-bent on reforming construction. They
are more focused on the middle and smaller
range of construction businesses, claiming that
they’re best for companies between 5 and 299
contractors. For contract management, their
document management system automatically
creates a new folder for each project served.
The system provides a full audit trail and
differing permissions levels, so everyone
involved in the project stay informed.
Pros: Intuitive for all users, easily track contracts with a Gantt layout, full-featured mobile app for iOS
and Android, well priced. Reviewers tend to be happy with the overall product.
Cons: Isn’t a full ERP solution, meaning that it’s missing some features found on other options in this
review (ex: accounting) nor does it offer the functionality to sync with third-party solutions.
Price: Starts at £20 (about $30) a month and scales with project size.
32. Goldenseal by Turtle Creek Software
If your construction business is on the smaller
end, consider Goldenseal. The software’s
database manages the existing status of your
contracts and continually updates it. You can
use Goldenseal to not only balance your
contracts with your clients, but also with your
subcontractors and heavy-machine rentals. The
software is integrated with accounting and
estimating features. While it’s not a complete
construction ERP software, Goldenseal will
definitely get the job done at a cheaper price
point than any other solution on this list.
Pros: Reviewers rave about their satisfaction with the software, excellent software option for companies with a
limited budget, provides full construction management functionality.
Cons: Website is off-putting and software start-up can take a while.
Price: Fixed at $295 to $695 for a single user and $995 to $2,195 multi-user.
33. INAXUS
INAXUS is targeted at civil and infrastructure construction, though it
also focuses on oil and gas, manufacturing, and power generation.
The construction ERP solution is well-known within Asia and the
Middle East, and it’s working to get a foothold in Europe and the
Americas. With that said, it’s earned its popularity in the Far East.
This complete software offers flexible contract features, such as
version control and document search. When I spoke with Andrea
Lopez, the head of marketing, she stressed, “[Our contract
management system] enables proactive tracking, avoids delays on
project deliverables, and speeds up project tasks. [Our] workflows
also have a proper escalation matrix and approvals for an efficient
and effective project management throughout the project course.”
Pros: Offers consulting and personalized customer support and regularly conducts “surprise” audits, so you
never need to worry about compliance issues.
Cons: With so many ways a company can use this product, INAXUS can quickly get too heavy and features go
unused.
Price: Variable based on project.
34. Jonas Premier
Because Jonas is located on the cloud, it’s
able to provide its users with unlimited
storage space for their contracts. They
also integrate seamlessly with Microsoft
Word, Outlook, and Excel, allowing users
to create their own custom forms and
push them directly into the program.
They’re focused specifically on general
contractors, so if your construction
company needs a program with a greater
scope, Jonas is definitely not for you.
Pros: Great customer service, unlimited storage, and super easy to use. It also has a great mobile app and
syncs with Microsoft Project, Quickbooks, and more!
Cons: Training delays when users can start using the product and some documents require manual sorting.
Price: $6,500 one time training fee, $150 per user per month, and $25 per APP user per month.
35. Knowify
Commercial subcontractors need construction
management software too, and that’s where Knowify
steps in. The fully-functional software seems to have
thought of everything to become one of the best
contract management software for construction. Its
contract functionality allows users to quickly submit
and electronically sign change orders, while also
managing all maintenance and accounting materials
in one place. Knowify is great for subcontractors who
want a no-nonsense approach to bidding, contract
management, change orders, and project
management
Pros: Offered at a great price point, mobile timesheets, and free training.
Cons: If you don’t have Quickbooks, you won’t be able to take advantage of all of Knowify’s accounting
features.
Price: Starts at $68 a month and scales up with the number of users.
36. Pro DBX
Pro DBX is a great contract management software
option for all-sized business. The software offers
digidocs—a system that keeps all contracts and
forms immediately available and searchable online.
Pro DBX also allows users to track their materials
with GPS, take inventory and cover purchase
orders, manage payroll and timecards, and offers
task management capabilities
Pros: With an emphasis on CRM and reputation management, this system is great for construction
companies looking to make the sale.
Cons: Doesn’t have as robust project management or change management features as other software
options on this list.
Price: Starts at $15 per user per month (with a minimum of $150 per month purchase) and scales up
based on your company’s needs
37. RENOMii
RENOMii is largely used by small and medium-sized
homebuilders—though subcontractors can easily
use this software to manage commercial contracts.
Where RENOMii really shines is with change-order
requests. The system tracks the status of the
request and automatically adds all approved
change orders to the running total contract cost, so
they eliminate cost and time negotiations RENOMii
also offers unlimited free cloud storage and
outstanding user permission customizations. Its
emphasis on clear communication does not go
unnoticed by its users, who tend to cite
communication improvement as RENOMii’s greatest
ROI.
Pros: Excellent communication features, allows users to quickly address change-order requests, and keeps
all areas of the business—from time cards to project management—in line.
Cons: Users need to create new projects for every contract and relationship which can quickly get clunky.
Price: $399CAD per year (or about $280USD) or $43CAD per month (or about $30USD).
38. If we could implement the above methods/ procedures in contract management system then the efficiency,
effectiveness and economy of the service can be enhanced.
Relationship could be improved, balancing costs against risks could be reduced and can actively manage the
customer–provider relationship. Effective Contract management aims for continuous improvement in
performance over the life of the contract.
Advantage of available softwares can be taken which in turn reduces the time as well as improves efficiency of
the construction project
39. Recommendations & Scope for future study
Recommendations
• As the above suggested methods necessitates the investment of money and time from the design team as
well as management team ,there might me constraints to implement but if implemented savings can be
realised.
• Since effective contract management is complex ,many softwares are available with potential benefits at
reasonable cost (some are for free also) so can be made use of those , to enhance the construction projects
overall performance.
• Design alternatives are properly assessed and most feasible one is selected ,as infeasible would result in
adverse results to project .
Scope for future study
• Effective contract management has a lot of scope ,as it helps in realising the captured savings , and hence
results in increased profits for the organisation.
• Further study can be done in using the softwares available and identifying their potential benefits and
selecting the best which would give better results and versatile in nature .
• Existing methods could be optimised by rectifying the defects /limitations if any so that efficiency and
effectiveness of it can be improved and hence improving effective contract management.