Post Award Contract Management Best Practices
Are you trying to implement the post award contract management at your organization but aren’t sure of the right way to go about it? You certainly cannot leave the compliance stage disorganized without keeping a formal track of it. But managing multiple activities for organization-wide contracts isn’t easy.
That’s where the automated post award phase of contract management comes in. By adopting the best practices at this stage, you can improve operational efficiency and leverage contract data to build more robust contracts in the future.
What is Post Award Contract Management?
Once a contract is formalized and signed by the parties, the post signature stage begins. In this phase, the terms set in the contract are executed and monitored by the parties. Meeting deadlines, ensuring good quality, and streamlining the organization’s processes are guaranteed. Also, continuous contract monitoring ensures that the contracting parties understand what’s happening and are satisfied with the results.
Importance of Post Signature Contract Management
After the terms of a contract are decided and signed, it is likely to go in hindsight. The teams tend to close more deals and forget the contract dates and execution tasks for the older ones. A study indicates that only 22% of companies are confident that they can monitor the progress of the contract and keep it on track.
Also, there’s a chance that there could be changes in the contract terms depending on the ground realities. Similarly, the execution of tasks might require approval from different parties. A regular flow of information and communication between parties is necessary for such situations. It is only possible if your organization has a proper system in place in the form of post-signature contract management.
Activities Included in Post Award Contract Management
Here are the main activities included in the post-contract award management stage:
Approval of Milestone Payments – The mileposts in the contract are met, and timely reports are generated to get the milestone payments.
Delivery of Quality Goods and Services – A proper monitoring system for evaluating the quality of goods and services is set in place.
Compliance with Timelines and Due Dates – A post award contract management system stage sets up timely tasks to meet the deadlines and follow the contract terms
Proper Communication – Regular reports and information exchange on deliverables are an important part of the post award contract management stage.
6 Post Award Contract Management Best Practices
When adopting post contract management, it is essential to follow the best practices. Compliance with the benchmarks can help you get the most out of the individual contract and the overall contract management process.
1. Comply with the Contract
Breaching the terms of a contract wouldn’t only create a negative reputation; it will also result in legal problems. Additionally, you’ll also lose your client. So, it is important to comply with the terms signed in the contract as a best practice for this stage.
2. Must Include Strategic and Operational Tasks
As a best practice, the post contract management phase must consist of the tasks to be completed at the strategic and operational levels. Identifying the team members and assigning individual deadlines will ensure better results. A contract management tool can help your organization by giving automated reminders before the due date.
3. Identify Post-Signature Acquisition Hardships and Complications
The actual things on the ground might differ from the expectations. In some cases, the consequent events might render the execution of the task difficult as compared to the contract signing. So, such hardships must be identified and communicated to the other party to get the most out of this stage.
4. Combine Staff Training with the Right Contract Management Tool
Another important practice to normalize at this stage is to train the staff for the complete contract management cycle. Using a tool to automate the entire process along with contract tracking can enhance productivity and bring better results. Trained staff will be helpful in fulfilling the future contractual obligations of your organization too.
5. Conduct Auditing and Reporting Regularly
Also, this stage requires conducting contract audits and proper reporting based on the evaluation. It will ensure that contracting parties are on the same page. By adopting this simple practice, you can even update the relevant stakeholders about the upcoming deadlines and obligations due under the contract.
6. Leverage Data Provided by your Contract Management Tool
Using data from the contract management tool regarding contract closures, renewals, and timely completion can help organizations make better decisions.
The organizations can incorporate the data from the upcoming contracts and obligation fulfillment in the functional departments like Finance and HR for better execution. These steps ensure higher compliance rates when it comes to contract management.
Benefits of Implementing Post Award Contract Management Best Practices
With the implementation of the best practices of post-signature contract management in your organization, you can expect the following benefits:
● Easy installation and customization – As all the data is already in place, implementing post-contract management best practices becomes easier. Similarly, customizability of the stage depending on the contractual requirement is possible.
● Reduction in cycle times – By following the best practices, the contract execution and renewal times can significantly be reduced.
● Builds relationships with the supplier – Constant communication between the supplier and the company can identify the right suppliers to build strong relationships.
● Better monitoring of the quality process and vendor performance – Analyzing the quality regularly and promptly communicating the problems can help create a strong quality process strategy.
● Integration with other systems – Other organizational functions can be easily integrated to streamline operations.
● Eliminates “value leakage” – Regular monitoring reduces the chances of value leakage throughout the process.
● Improve audit and compliance status – A proper phase for contract monitoring and compliance will improve the organization’s existing process.
● Retrievable documents and templates – Keeping everything documented for compliance will enable all parties to find all the relevant documents easily.
● Allows better change control management – A specific process for monitoring change can ensure that the baseline contract or project is regularly updated without surprise for any parties involved.
Post award contract management is one of the essential stages to help organizations plan the execution of the signed contract. Automating the process and using specialized tools at this stage can enhance overall productivity, streamline the organizational processes and build relationships with different stakeholders. Similarly, adopting the best practices in this regard can help you audit the existing administrative functions and make better contractual decisions.