A contract management plan can be utilised for all type of contracts including construction, services and supply contracts and even consultancy agreements.
It is a useful tool for identifying and managing risks to ensure a successful outcome of the contract.
It also assists in value-for-money outcomes being achieved.
Even a relatively simple low-risk contract will benefit from a well prepared contract management plan (or simple check list).
This should ensure that important obligations are not overlooked and the overall intent of the contract is achieved.
Whilst the format and content of a contract management plan will vary with the type of contract being administered, generally speaking it contains a summary of the key contract documentation and all related information in simple terms. It is really the “guidelines” for managing the contract.
Contract management plans typically contain a summary of contract details such as:
- key contacts,
- dates and milestones,
- roles and responsibilities of personnel,
- the contract terms and conditions,
- communication and reporting requirements,
- performance indicators and measures,
- pricing and payment conditions, and
- risk assessments.
The detail required in a contract management plan depends on the risk and complexity of the contract—ranging from a simple summary of key details to comprehensive documents for more complex contracts.
While all stakeholders should contribute to the development of the contract management plan, the contract manager or team is usually responsible for its development. Most of the work required for developing a contract management plan can and should be done before the contract is awarded.
The level of planning for a contract management plan should be commensurate with the value and risk of the contract being administered.
About the Author
George Strohfeldt is Principal of Contract Control International Pty Ltd. He is a Chartered Professional Engineer with over 30 years of industry experience.
His skill areas encompass dipute resolution, providing contractual advice, contractual and security of payment claims preparation, assessment and management, commercial negotiations, preparation of tender and contract documents, probity auditing, risk, opportunity and value management workshops, risk assessment and loss control, and workplace training.
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