Every business owners out there, be it a small start-up or a big corporation, should have the basic knowledge in contract administration.
Contract administration, in layman’s term, is the involvement of all activities that are related to the monitoring of contractors, suppliers, and service provider’s performance in correlation with their contractual ties. It’s very needed to ensure that every appropriate measure is being taken seriously by both sides, to avoid any deficiencies within the contract’s scope, implementation, and its terms and conditions.
So Where Does It Begin?
Contract administration begins upon the outlining process, which both sides should prepare especially on the bidding and selection process. The outlining process includes the designation of the contract administrators, a game plan for undertaking periodic performance review, the time frame for verifying the performance and the accepting of contract deliverable so act as a remedy for payment delays, and an overall understanding of the contract’s terms and conditions to establish overall effectively.
Although the actual planning begins during the selection process, contract administration actually starts upon the signing of the contract, which is the point at which the parties to the contract are bound by its terms and conditions.
Who Are The Responsible Individuals?
The rightful individual inside a contract administration most likely designates staff members, or better yet a team of capable personnel, to take charge in administering the whole contract. It’s the obligation of the Contract Administrator to implement the duties and obligation of the rightful individual stated in the contract in order to ensure that the contractors, suppliers, and service providers apply the contract in correlation with its terms and conditions. Furthermore, the service provider, contractor, and supplier’s main responsibility is to ensure that the services, works, and goods match the agreed standards on the contract and to advise on the need of any adjustment on the contract if ever there are problems faced upon the implementation of the contract.