C/P Administration & Closure - Part B

What else should I know about the C/P administration and closure processes?

Contract/Procurement Administration

Continued from Issacon #1405 - Part A

Contract claims

·      Reserve the term "claims" for work that the supplier

·         Considers is over and above the terms of the contract

·         I.e. alleged additional work

·         Don't use the word to refer to the supplier's normal invoices

·         This just leads to confusion

·      Upon receipt of a claim

·         Or even a notification of a potential claim

·         Research, negotiate and settle or reject the claim

Handling claims

Many organizations

·         Simply reject all claims automatically, out of hand

·         This is a mistake

·         Unless the claim is clearly spurious

·         It is usually cheaper to settle at the time

·         Than incur rancor and extensive legal bills

·         And impede the progress of the work

Settling claims

·      The best way to settle a claim

·         That has any degree of validity

·         Is to negotiate a settlement

·         And issue a change order accordingly

·      Needless to say

·         Maintain a careful record

·         Of all contract changes

Final acceptance and closure process

When all the work is supposedly complete

·         Verify that the product meets all contractual requirements

·         E.g. functionality, documentation, support, etc

·         Ensure that all deficiencies have been corrected satisfactorily

·         Or otherwise some adjustment is made to the contract price

·         (Remember the law of diminishing returns!)

Product transfer

Once completion has been established

·         Obtained corporate owner and/or users "sign-off" on the product

·         Against a final acceptance checklist document

·         And make arrangements for the transfer of the product

·         And its care, custody and control

·         Into the hands of the users

Contract closure

Final payment and audit

·         Receive supplier's request for final payment

·         And verify that it meets all the terms of the contract

·         Obtain approval

·         And pass the invoice to the accounting department for payment

·         Arrange for a contract procurement audit, if required

·         Close all associated accounts

·         And archive all contract records

Final word

A final word to the supplier

·         The real success of many projects, and contracts

·         Comes down to a matter of perception

·         It is worth spending a little energy

·         On promoting the product to the users

·         And helping them to get the most out of the product

·         In which case, the users are much more likely to be forgiving

·         Of a few minor initial operational glitches

·         Even though these are quickly corrected