All the contract relationships have to be handled effectively and efficiently. Organisations have to hire trained personnel to handle all the complexities related to a contract. These professionals are tasked with competent Contract Administration.
A contract is a legally binding promise, whether in written or oral format, between two or more participants. It is to complete the terms and the conditions mentioned in the agreement.
For the enforcement of the contract, all the concerned parties have to agree unilaterally to all the clauses in the contract.
Contract Governing Principles
After a contract is in effect:
• All the concerned participants should have all the relevant documents.
• Important departments and key suppliers should be awarded necessary responsibilities and authority.
• Periodic reviewing of policies, procedures, or any contract reporting.
• Keeping a track of the timelines and payment processes.
• Maintain control over contract changes, new and old documentation.
• Keeping an open channel of communication for resolving any disputes.
Managing a contract requires careful negotiations, handling contracts, and ensuring support from all contractual parties like customers, vendors, partners, or employees.
It is the process of methodical and effective management of a contract at its creation, execution, and analytics stages for the purpose of capitalising on monetary and operational performance and minimising the inherent risks.
Contract manager should be aware of his key responsibilities in a successful execution of a contract. He should be knowledgeable and have the ability to make timely decisions.
Contract Supervision Responsibilities
For effective contract management, certain important activities have to be properly carried out.
The necessary contractors have to be notified to start the job. Compliance of the work with the standards provided regarding quantity, quality, timeline, purpose, etc. has to be ensured.
Progress and processes have to be periodically reviewed to certify effective management.
Keeping a complete control on the expenditures and costings to prevent over spending. Verifying the authenticity of the invoices helps to keep everything within the assigned budget.
Getting timely contract renewals to prevent a break in contract workflow and keeping all necessary documents in the correct format ready for audits anytime.
Maintaining work consistency at all times is also very important
A contract executioner cannot get the job started unless the contract is legally ready to begin. He cannot change the scope of the contract or issue instruction in direct contrast to the terms and conditions defined in the contract.
Unless specified otherwise, contract supervisor does not have an authority to make amendments to the contract. So he can’t make unscheduled changes according to his whims and fancies.
He cannot change the budget allocation, can’t ask the contractors to incur additional personal costs or change timelines. He has no authority to contract personnel other than mentioned in the legal contract.
Contract organisation should improve the communication between all the contractual parties. Increase the understanding of the aims, necessities and the documentations required for a successful execution of a contract.
Collaborative work to increase productivity leads to innovative work procedures that lead to greater efficiency. Also, fast resolution of conflicts leads to a better working environment.