Effective contract management is essential to achieve value for money in the public sector, use these tips to start working more efficiently and cost-effectively.
The public sector currently spends £250 billion on commercial suppliers and is under constant pressure to spend less. This is just one reason why it is so important to ensure that public sector contracts are always being managed in a way that is as efficient and cost-effective as possible.
The services provided by public sector contracts are under constant scrutiny from the public eye, so it is crucial that the people managing these contracts are provided with high quality training to help them carry out their roles to the best of their ability.
Effective contract management ensures that we receive the best possible service for the money being spent, as well as avoiding expensive and damaging breaches and disputes.
We’ve compiled five of our top tips for creating efficient contracts and managing contracts throughout their term.
Have a performance management procedure
Make sure that your contract’s terms include details of performance expectations and how performance will be measured and monitored. By providing a structured framework from the word go, all parties should have complete clarity about what is expected and how poor performance will be dealt with. This should help to ensure you receive the right level of service and make working relationships run smoother.
Include a provision for changing requirements
It is inevitable that at some point your requirements will change, especially if it’s a long contract term. To make amendments to the contract without having to start over with the procurement process you should include a provision for modification in the contract. Regulation 72 of the Public Contracts Regulations 2006 allows for these kinds of amendments.
Thoroughly document all changes
If changes are made to the contract, no matter how small, they should be thoroughly recorded and then stored safely to prevent any future disputes.
Make sure all staff involved understand the contract
Often, contracts are managed primarily by one person or team. It’s important that the person or team who initially negotiated the contract ensure that the operational team also fully understand it for its ongoing management to prevent an accidental breach.
Include a get out clause
Having a contract exit strategy in place will allow you to end a contract early if things aren’t working out to avoid wasting money. It is important to include termination clauses in your contract so that it is clear from the start under what circumstances you could validly terminate a contract.