Contract management can be defined as the process that involves administering contracts between a company( for instance,eTimesource) and its vendors (clients).
Seven essential criteria that makeup contract management
1. Creation: A lot of companies work from standard established contracts; nevertheless, they are required to be instituted or created and then revamped as negotiations occur.
2. Negotiation: Contracts are expected to be negotiated to ensure both parties enjoy the best possible contract.
3. Adherence: Both parties are expected to comply with every sections and goal of the agreement.
4. Approval: Secure approval before concluding the contract. All requirements for approval must be implemented before concluding on the deal.
5. Execution: Immediately, the signing has been done, make the contract official. You can utilize an electronic signature if you are signing a contract with parties across the globe.
6. Update Amendments and Revise: There is nothing like a dormant contract. Amendments and revisions are components of a contract’s lifecycle.You can use the contract lifecycle management programs to guarantee a reliable process.
7. Manage Auditing, Renewals, and Obligations: Don’t just stop at the ink. Perform frequent audits to ensure value is attained, and obligations are met.
Why is Contract Management Important?
There is need to tactically manage the contract to guarantee the minimization of operational and financial risk and the maximization of vendor performance.
What are the Three Areas of Vendor Relationship
1. Contract Administration: This is the print management of the contract. It is complete adherence to all sections and aims of the contract.
2. Service Delivery: This aspect has to do with managing the deliverables of the vendors. It ensures the products and services meet quality requirement and service performance. This is accomplished by Service Level Agreements defined during the negotiation phase of the contract.
3. Relationship Management: This aspect ensures a mutually constructive relationship between the vendor and the company.
Conclusion
As soon as the contracts have been fairly negotiated and signed by the parties, Service Level Agreements should be established to measure performance and intimate the vendor of the requirement.