Contract management is a key function that helps to deliver contracts in time, forecast risks, analyze them and mitigate them, and ensure that all deliverables are met in time. We support our clients in systematically and efficiently managing contract creation, execution, and analysis for the purpose of maximizing financial and operational performance and minimizing risk.
We handle contracts of different diversified natures including sales contracts, purchasing contracts, partnership agreements, trade agreements, intellectual property agreements, leases and many others.
Companies generally experience administrative and regulatory hurdles in tracking and complying with contracts. With contractual commitments translating into millions of dollars relying on manual methods for contract management is no longer viable as they expose any entity to legal and financial risks. To meet emerging requirements, companies need to establish an effective automated contract management framework based on the principles of transparency, clear governance, absolute accountability and continuous improvement.
Standard Contract Management may involve any of the following;
- Authorizing and negotiation
- Baseline management
- Commitment management
- Communication management.
- Contract visibility and awareness
- Document management
- Growth (for Sales-side contracts)
- Contract compliance/governance
Contract Management also involves change management in case one or both parties requires any alteration on the agreed terms and conditions in the contract. These changes may include;
- A Mutual Agreement of both parties to vary the contract, outside the framework of the existing contract. This would be an independent basis for changing the contract.
- A Unilateral Decision to vary the contract, contemplated and allowed for by the existing contract. This would normally have notice periods for fairness and often the right of the other, especially in consumer contracts, to cease the contractual relationship. Be careful that any one-way imposition of change is contractually justified, otherwise it may be interpreted as a repudiation of the original contract, enabling the other party to terminate the contract and seek damages.
- A Bilateral Decision to vary the contracting, within the variation or change control process outlined in the existing contract. These are often called change control provisions.
It is important to ensure that contract conditions and terms are met, but it is also critical to take a closer look for items such as unrecorded liabilities, under-reported revenue or over payments. We carry out Contract Compliance for Our Clients to ensure that there are no gaps, if these items are overlooked, margin may be negatively impacted. A contract compliance audit will often commence with an opportunity review to identify the highest risk areas.