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Contract management is a task which engulfs the entire process of planning, awarding, and executing a contract and administering the obligations that arise therefrom between the contracting companies. Moreover, contract management is not only that, but it is now also a business and a service. The services are now even offered by agencies which are distinct from the contracting businesses. Nevertheless, the trend is to automate the entire process of administering contracts, as more and more see the benefits and advantages of letting the machine do the work. The more traditional mode is of course to go manual: from drafting and overseeing the written contract, to the tedious and laborious task of auditing and review. To the conservative, one cannot be too careful with contracts. Going manual, however, has many hang ups.
For it to be effective, manual contract management services should include a team of people who are no less than experts with the specifics of the contract, and contract law. This is especially difficult with large companies which handle thousands of contracts in the usual course of business. The key is to recruit a point person who has special affinity with a specific pile of contracts; for big companies, this will therefore include a lot of point persons.
It further involves maintaining the coordination between the company and its stakeholders to ensure that the contract remains healthy and that the terms and conditions that had been put effective as law between the parties are maintained to be so. This can easily fail and could easily end up as a judicial matter in court, so that is why the it should also include this as a priority. Anent to this issue is the meeting of deadlines and handing out of payment is done to the letter of the contract. Being aware of these is also a job that is up to the contract management team is bound to uphold.
Furthermore, contract management may, at any time, go haywire, upon non-compliance of the terms of the agreement, or due to simple misunderstanding. Going to court is the ultimate end upon which conflicts arising out of contract law are settled, but this would entail much time and effort, aside from the money that would go into filing fees and attorney’s fees. Contract administration is best done with the advice of a legal counsel or attorney, which not all contract management services have in their team.
The downside of all of these is that deciding to go manual with regard to contract management may easily take its toll because along the lines of building a perfect contract management team and conflict resolution, a million flaws may have ruinous impact.
The contractual relationships that a company maintain in their helm are easily the foundation upon which the future of the company lies. Contracts, when enforced properly, can cut risks, produce maximum profitability, and strengthen income bases and so on. This would only follow upon the proper choice of contract management service, and so a business must choose wisely.
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Source by Lina Somes
