5 Best Practices for Contract Administration

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5 Best Practices for Contract Administration
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Create a Cohesive
TeamPutting together a good team is one of the
most important steps to take for every single
company department. If the members of the
contract management team are not on the same
page, it will be far too easy for important
contract deadlines to be forgotten or logistical
issues to arise. Thus, with contract management,
it is particularly important for the team members
to have strong communication skills, a keen
attention to detail, and the ability to take
action quickly and decisively. By creating a
cohesive team with these skills, it shouldnt be
too hard for them to keep all of the details
related to contracting in order.
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Formulate a
Clear Strategy Once the right team has been
created, those folks will need to formulate a
clear strategy regarding the manner in which they
intend to manage the portfolio. Roles must be
assigned according to each members strengths and
weaknesses. In addition, the portfolio may need
to be divvied up on the basis of timeframes or
contract type. As with any business operation,
the only way that contract administration will
succeed is by establishing concrete objectives
and instituting a clear strategy from the outset.
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Invest in the Right
TechnologyInvesting in the right technology will
be critical to staying organized and ensuring
that there is appropriate contract performance
and compliance. Even if a portfolio is relatively
small in the beginning, it will become impossible
to keep up as more contracts are added. As a
result, it is wise to invest in a dynamic
solution that will accommodate contracting
growth. Some key features to consider are data
security, unlimited storage and users, and round
the clock technical support.  
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Continuously Assess Operations and
OutcomesThere is a common misconception that
contract administration merely entails making
payments and monitoring deliverables, both
tangible and otherwise. But, the reality is that
contracts often play a huge role in a companys
operations. Whether contracting with a vendor
that will be providing goods for the company to
create a product or contracting with other firms
to receive professional services, all contracts
involve an exchange of promises that add value to
the business in some way. As a result, contract
performance must be assessed within the larger
context of the businesss operations. This will
allow the company to evaluate whether its
contracts are helping to facilitate, or perhaps
even hinder, the businesss overarching goals.
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Think Long TermAnother issue with contract
administration is that companies often just look
at each individual contract based on its
duration. Granted, some agreements will expire in
six months to a year, but many will last much
longer that. But, with the right mindset, some
contracts can become real assets over time.
Establishing relationships with contracting
partners over the long haul will result in cost
savings, and may even lead to other business
opportunities. As with most business operations,
contract management requires a long-term
approach.
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