There are many ways to measure the success of a contracting cycle. For example, the time the contract took to negotiate, the timeliness of the delivery of services and the accuracy and quality of the services delivered are all things that could be measured and considered. But how many of these factors can be used to measure the performance of your internal contract managers? Is it the case that some factors lie outside of their control and should not be considered in managing their overall performance?
We are of the view that many of these factors can and should still be considered. Here are 9 factors that should be reviewed.
This is about managing how well services are delivered - e.g., the cost of the services, the quality of delivery, the time it took to deliver and how flexible the service-deliverer was (if and when any changes were required).
- Cost of the services: If the cost of the services exceed the original budget ask the manager to detail the reasons why they chose this provider despite the high cost and if they attempted to negotiate on price.
- Quality of Delivery: Was the work performed to an adequate standard? Quality should be reviewed and the contract manager questioned about steps they took to engage with the provider about resolving any relevant substandard work issues.
- Delivery Time: When there were delays, ask the contract manager to detail how they engaged with the provider to query the reasons for the delay and negotiate compensation for not meeting the agreed time frame.
- Flexibility of the Vendor/Supplier: Was there anything that had to be changed during the contracting process? Was the vendor accommodating of these changes? How was the contract manager involved in negotiating these changes? Was he/she successful in this process? If they were not successful, query them on their reasons for what they did and ask them to reflect on how they may go about the process differently next time.
This is concerned with the maintenance of the relationship between the vendor and the contract manager.
- Resolution of relationship problems: How many problems were raised during the process. An example of a problem would be the contract manager or the vendor/supplier finding it hard to contact the other when required. How were these problems dealt with and resolved by the contract manager?
- Satisfaction of the vendor/supplier: How happy was the provider/vendor with the performance of your contract manager? Ensure there is a place where suppliers can provide feedback. Perhaps they can even rate the ease of working with the contract manager. Ask them whether they would be happy to do business again after their experience. Should your contract manager receive a bad review, ask the supplier to explain why they believe they received this rating.
This is concerned with the formal governance of the contract and changes to contractual documentation. Factors relevant to this part of the contracting process include:
- Time spent drafting the agreement: How many times were particular clauses re-drafted? If certain clauses took a particular amount of time to negotiate query why. Do this by asking things such as from where did your contract managers source their precedent clauses and did they consider data analysis available about the past performance of these contractual terms?
- Dispatch of fees and documentation: Were all fees and documentation dispatched and received at the required times? If not, why not? Should there be fees and documentation required from the vendor that was not provided, then you should ask what steps your contract manager took to manage their delivery.
- Internal Reports: Were all internal reports produced within the required timeframes? If not, ask your contract managers to provide reasons for not complying with internal processes.
What are your thoughts? What factors do you take into account when measuring your contract managers’ performance?
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