What is Contract Management?

Contract management means different things to different people.

To Montbay, which provides consultancy services to the Mining and Construction industries, contract management means the management of contracts through the effective management of the risks associated with the contracting process.

So what are the risks…….? By far, the greatest are Time and Cost.

And how do we manage Time and Cost……?

We at Montbay do this by assisting our clients to control carefully the entire contracting process with the thrust being on:

• The Documentation

Contractually "tight" so that there as no conflicts, ambiguities or omissions,

Clear and concise methods of measurement and payment,

Engineering considerations built in, not just legal requirements.

• The Tendering Process

Selection of tenderers to match client company requirements,

Compulsory Site Visit by tenderers,

Issue of Addenda to tenderers where necessary

• Tender Evaluation

Witnessed tender opening and registration,

Evaluation Team uses predetermined approved evaluation criteria, scoring and weightings for all Price and Non-Price elements,

"Must Have Criteria" checked and unacceptable qualifications withdrawn,

All issues tracked in writing until "closed out",

Full process open and auditable.

• Post Award

Client company personnel suitably trained in post award Contract Management,

Procedures in place for reference in the following KEY AREAS,

• Delegation of Authority

• Delays and Extension of Time

• Production/Development Rates (Mining)

• Programming the Works

• Controlling Progress of the Works

• Claims for Variation and Variations

• Latent Conditions

• Force Majeure

• Default by Contractor (including rights of the parties)

• Progress Claims and Payments

• Forecasting Time and Cost

• Practical Completion and Final Completion

Correctly managed contracts with good documentation undoubtedly have a far better chance of success than those that don’t.

Are you prepared to take the chance by not being fully prepared to manage your contracts successfully?

When contracts go sour, the consequences are frightening……

• Increased project costs
• Project delays
• Arbitration and/or litigation costs
• Consequential increased Corporate costs
• Distraction from key business activities

All the preparation in the world will not prevent some contracts turning "sour", but the probability of this happening can be greatly reduced.

Are you adequately prepared…….???