Five contract management tips for the public sector

Whether a full OJEU process or a tendering exercise, successful procurement will result in a contract with a supplier. This is when the hard work really starts, so here are five tips to help with the process of contract management.

Image Credit

1. Monitor your own SLA

Service level agreements (SLAs) are in widespread use as part of public sector contracts. A good contract management system will enable you to incorporate the SLA standards as performance metrics so that you can monitor the supplier’s performance against them.

This has several advantages. If there are problems, it gives you information early on so that you have the chance to ask the supplier to fix any issues before they escalate. It also provides you with the data you need to have an effective discussion with the supplier, providing a factual basis for any dissatisfaction. The fact that you can provide data to support your position is a key strength.

2. Build good relationships

Don’t treat the supplier as your enemy. Big business makes a point of working with suppliers to enable them to deliver against their contract. An adversarial relationship will not result in a better service and may make the supplier defensive. It is possible to hold people to account in a calm, objective way; again, this is where a Contract Management System can do much of the work for you.

Image Credit

3. Resolve issues

Don’t just have a lengthy discussion around the issues; in addition, make sure that both you and the supplier are clear about how they will be resolved.

4. Consider the market position

It may be that you have had trouble getting enough suppliers to bid for the work you have on offer. In this case, you don’t have as strong a hand as if there was fierce competition for the contract. If the supplier was chosen from a framework, there may be no other suitable suppliers on the framework. Bear in mind your relative strengths when you are negotiating with a supplier.

5. Flag the endpoint

Use contract management software to flag the contract end three months in advance. This gives you enough time to think about whether you want to renew or whether you will retender when the contract ends without being rushed into a decision.