Contract Management - Qualified Project Leaders

Resorting to automated contract management systems is often a quick-solution to an awkward, time consuming but necessary part of business. Alternatively, organisations usher an unqualified employee into the project leader position, which could bring the system to a complete collapse. Ignorance to contract management will only result in a negative effect on your business, assign the role to a qualified project leader and preferably one that comes from in-house.

This article explains the reasons why proper contract management is important, who to appoint as project leader and how computerised systems should be used as aids, not substitutes.

The importance of contract management

All contracts in a business, from a short-term contract for an employee to a large purchasing contract with a supply chain, need to be maximised in terms of value and minimised in terms of risk. Correct contract management can ensure this is the case.

Without monitoring each and every contract, your business is slacking when it comes to things like identifying suppliers, negotiating prices and examining compliance between current associates. If a contract with your supplier is not being adhered to by that supplier, it may go unnoticed with poor contract management and you will be losing out.

Without a project leader keeping things organised, alterations to existing contracts could be difficult to make as the contract could physically be lost. This could result in an unsatisfied customer/partner who may choose to withdraw from doing business with you in the future.

Contracts expire and by having a project manager in place to keep up to date with these expiries, you can plan in advance what changes need to be made with the renewal contract. Failure to renew contracts could have a seriously damaging effect on supplier and customer relations.

Solid contract management reassures customers that their business with you is secure and you respect their position. In turn, you can always refer to a contract if you think the customer is acting outside the parameters set between you both. But you cannot refer to this contract if you don’t physically have it available.

Contract management and computers

Automated contract management software is available but whereas it keeps everything organised in terms of expiry dates etc, it does not sell contracts for you. You will still have to put the work in yourself to secure new deals, in the way you want to secure them. These programmes should only be used as tools by your project leader, not as a replacement for the project leader themselves.

By using spreadsheets the project leader can list all contracts, with
all accompanying details, on just one page. This way, if a question comes up about a specific contract, they don’t have to rummage through the filing cabinet full of paper work to find it.
Note: Keeping hard copies of contracts inside a secure filing cabinet is still advised.

Spreadsheets allow for different ways of cataloguing contracts - by priority, expiration date, value etc. So it’s much easier to identify any outstanding issues or contracts that need altering urgently. Also, if your project leader is planning on leaving the business, the system they operated with is already in place – making the training process for the new project leader much less complicated. You could even temporarily manage contracts yourself on such an organised system, until hiring a new CM.

E-signatures (electronic signatures) allow your project leader to negotiate with clients/suppliers without the need for face-to-face meetings and a load of paperwork. This speeds up the sales process dramatically and your business will be capable of handling much more contracts than when it was running on a completely manual system.

For the finest contract manager tools, use respected and bespoke contract management systems.