Contract Management For Procurement In Orange
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To recap, procurement is the process of acquiring the supplies you need to run your business operations. On the other hand, supply chain management encompasses how those supplies are transformed into finished products and delivered to the end-users.
The elements in a successful (and functional) procurement contract include: Full consideration of all sourcing processes. Robust and comprehensive negotiations. Detailed project management requirements. Precise definitions of key contract terms. Essential KPIs with specific contractual aspects included.
Procurement contract management is about the managing of contracts associated with procurement or purchasing as part of legal documentation shared with partners, suppliers or even customers.
Procurement is a one-time event, a focused effort to find the best solution. Contract management, on the other hand, is a marathon, requiring continuous monitoring and management. The structure of these functions can also differ.
Procurement management focuses on securing favorable terms and contracts while contract management ensures the delivery of promised value throughout the contract's lifecycle.
Contract management concerns the 'contract execution' and 'contract termination & evaluation' phases (under the slogan: 'you can only manage a contract if it exists'). Supplier management on the other hand involves the entire contract lifecycle, from determination of needs to contract termination.
The Stages of Contract Management This may involve: co-ordinating communication between the current and new supplier; providing information; planning. The normal working period of the contract. This may involve solving any issues that may arise e.g. supply problems.
A typical contract management process can be broken down into four key stages: creation, collaboration, signing, and storing. What this process looks like at a more granular, actionable level will vary depending on the tools and frameworks your business has in place.
Every contract, whether simple or complex, is considered legally enforceable when it incorporates six essential elements: Offer, Acceptance, Awareness, Consideration, Capacity and Legality. It is critical that all six elements are present—just one missing element can make a contract invalid and unenforceable.
The six stages of a contract lifecycle are: Contract creation. Negotiation and collaboration. Review and approval. Administration and execution. Ongoing management and renewal. Reporting and tracking.
