As the world economy recovers from recession, pressure to extract greater value from contracted relationships to avoid unnecessary costs and risks or to deliver customer projects profitably, has placed Contract Management at the center of business strategy for the world's leading companies.
What is Contract Management?
Contract Management is the term given to the discipline of managing the contracting process. The contract lifecycle process encapsulates all activities from initial drafting of contracts and agreements, through to the management of contracted terms and conditions to ensure that the maximum value is extracted from contracted relationships.
Contract Management activities can be broadly grouped into three areas:
- Service delivery management – ensures that the service is being delivered as agreed, to the required level of performance and quality.
- Relationship management – keeps the relationship between the two parties open and constructive, aiming to resolve or ease tensions and identify problems early.
- Contract administration – handles the formal governance of the contract and changes to the contract documentation.
A Contract Manager must often be a relationship manager, enforcer, diplomat, project manager and legal specialist in order to manage contractual commitments and milestones to extract the greatest value from contracts.