Print Article for : Procurement And Contract Management

Your Online Guide » A Guide to Business » Stress Management In The

[P705]Procurement And Contract Management

by Ismael D. Tabije, Ism

Almost all the transactions that occur in the business world are governed by a contract is some shape or form. Some of the common examples of contracts we deal with in our day-to-day life are employment letters, sales invoices, purchase orders, utility contracts.

Contract management is the process of managing of all aspects and phases of any and all contractual agreements including the creation of certified, professional contracts that meet legal directives, supply categorization and systematization in contracts, etc.

Contract Management is the total arrangement of transactions of an individual or a venture. Contract management covers the most basic operation to the most major decision occurring between two or more identities in the business. Even the simplest individuals who are just leading an average living engages in a contract management in the form of the receipts of every purchase they make, the tickets they use in transportations, the warranty of the appliances or gadgets they have bought.

A contract management system facilitates coordination, reporting, and monitoring of multiple business processes and partners throughout the supply chain. The strength of contract management tools lies in automation: streamlining the management of each contract through its entire lifecycle, including the stages of planning, negotiation, storage, maintenance, and analysis.

Contract Management is the creation and maintenance of trading partner relationships in a structured format. Today's complex trading relationships involve multiple business processes and business partners throughout the supply chain. Inherent in these relationships are complex language and terms governing many factors such as price, shipment, payment, quality, volume breaks, rebate policies, discounts, and so forth. Managing all of this, especially if you have thousands of relationships and contracts that change on a frequent basis, requires a serious commitment of time, and resources.

Many businesses are based around a contract of some sort. The simple process is:

Party A supplies widget (products or services).

Party B requires a widget (products or services).

1.Party A and B meet and they agree to do business.

2.Party A sends Party B a contract.

3.Both parties amend the contract a few times by emailing it back and forth.

4.Party B signs the contract, sends it back to Party A, and keeps a copy.

5.Party A signs the final contract and sends a copy to Party B.

If all goes well, they never need to refer to the contract again. If things go really well, the process starts again when party B requires more widgets. If things don't go so well, both Party A and B (and their lawyers) need the contract. ASAP!

The process sounds simple. But anyone involved in writing and storing contracts will confirm that it takes time and money to deal with the paperwork. As such, there are hidden costs in contract management.

Most small businesses perform juggling acts with contracts between emails, computers and filing cabinets. Most Businesses don't have effective contract management procedures and often keep their contract ‘templates' in Microsoft Word documents. When they need to create a new contract, they search and replace key terms, and save new documents. They may even keep a copy of every revision of the contract as it changes, resulting in lists of updated versions.

The final signed contract is usually stored on a computer and placed in a paper file. Now the contract exists in two places at least: The real world and on a computer hard disk. It seems like a duplication of effort, a waste of time, and of paper.

Wouldn't it be easier if everything was in the same place? People should be able to capture the signed contracts electronically and store them with the original word file. Then they would have everything securely stored and organised, in the same place. They'd always be able to find the original contract quickly and easily. The small business would also save money by storing documents online, rather than using limited office space (and admin resources) for maintaining filing cabinet upon filing cabinet.

By helping customers store contracts, the small business is also providing some additional value to them.

Article Source : Pg. 12

About Author

Both Ismael D. Tabije & Jeff Bonnes are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Ismael D. Tabije has sinced written about articles on various topics from Skin Care, Business and Finance and Investment Management. Ismael D. Tabije is the Publisher-Editor of www.BestManagementArticles.com, a unique niche-topic article directory that features exclusively business and management topics. For a large dose of contract-management tips, ideas and strategies, see. Ismael D. Tabije's top article generates over 12100 views. to your Favourites.

Jeff Bonnes has sinced written about articles on various topics from Management. . Jeff Bonnes's top article generates over 880 views. to your Favourites.