A project contract has many phases and parts. This means that tracking and managing all parts of a contract may face a lot of challenges, especially when a project has hundreds of contracts. Global projects and mega-projects often involve large and complex contracts involving joint ventures, many contractors and subcontractors.
Manually handling the contract management process may face significant challenges, including:
Contract mismanagement often results in lost documents and a longer time to obtain approval and signing of final contracts.
Monitoring and tracking signed contracts before passing them on to other team members or departments who may be unfamiliar are critical to avoid delays. Project delays lead to project overruns.
Managing contract changes before and after contract approval is critical to the success of the project. Having a tool to track changes across time zones, regions, and teams ensures version control and timely, proven delivery. All of this minimizes risks, delays, errors, etc.
Contracts help guarantee compliance within agreed parameters. Effective contract management builds compliance and regulations throughout a project in a way to avoid legal issues and consequences for organizations.
Using PPM can ensure a professional contract management approach, improve risk management and profitability, and provide a clear return on investment (ROI) in terms of the cost and benefit of contract management activities. Contract management best practices, such as implementing contract management software, can raise the quality of customer relationships and maintain open written contract communication channels to avoid contract conflicts and escalations.
There are other benefits of using PPM, such as:
- Simplify your RFP process
- Supplier and bid management
- Improve bid analysis
- Transform contract management
- Contract Change Management
- Procurement and Resource Planning
- Enhance communication and collaboration
- Audit trail and documentation
- Deliver projects on time and within budget
PPM’s Contract Management provides businesses with contract automation, an auditable single source of truth and a real-time view of project progress and contract activity.
Having an integrated system between PPM’s contract management and project control can alert project professionals of cost or schedule overruns that may occur. Projects with integrated contract and cost management systems can efficiently collect contract bids, perform bid analysis, and award contracts. Not only can PPM add contract changes and send updated commitments to the cost management team for project reporting, but it is able to evaluate contract performance and calculate accurate progress.