Effective Contract Management Essay

Sarah states that good contract management is to prevent the blue cost of the contract punishment clause, should dictate each move wangle with a contracted entity. section of putive contract management is underdeveloped comprehensive training programs that asseverate employees of the benefits of following the terms of the contract. For example, purchasing employees at Sarahs comp any be informed of the various ways that an compact with a vendor tush benefit the company to save money. Without this reporting, the both sides do no way of monitoring the benefits of the agreement and developing any changes to make when the agreement comes up for renewal. Effective reporting also keeps streamlet play quantities that befriend both sides monitor their usage and determine when contract limits whitethorn have been met. Sarahs company relies on contracts with suppliers to keep her crease running efficiently. Shippers, vendors, and financial institutions etc. all require a high take of contract management to maintain efficient relationships with all of them. Understanding the effect of a good contract administration is essential in business making decisions that would maximize revenues and minimize risks.A contract is drawn up to create the guidelines for a business relationship. When parties abide by the terms of a contract, the company gains from the benefits that it has to offer. But poor contract administration can baffle businesses to violate terms of the contract, which can lead to penalties, fines and a potential lawsuit. in force(p) contract management is to prevent the high cost of the contract penalty clause, should dictate each move made with a contracted entity. Part of effective contract management is developing comprehensive training programs that inform employees of the benefits of following the terms of the contract. For example, in my company the purchasing people are informed of the various ways that an agreement with a vendor can benef it the company and how it will save the company money. Without this reporting, the two sides have no way of monitoring the benefits of the agreement and developing any changes to make when the agreement comes up for renewal. Effective reporting also keeps track of quantities that help each side monitor their usage and determine when contract limits may have been met.