Five Tips for Great Contract Management

No business can reach its full potential without correct management of contracts. However, this goes beyond practical organisation to include building a strong relationship with suppliers and other stakeholders. Here are five tips to help you do just that.

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1. Understanding the Importance of Knowledge Sharing and Supplier Expertise

If business success is important to you – and, of course, it is or you would not be reading this article – you will have chosen your supplier or other stakeholder carefully. Most likely, part of the reason you selected them was for their professional expertise. Wherever possible it makes sense to draw on this expertise in order to improve the efficiency of your own business. An element of reciprocity, or mutual knowledge sharing, should help cement your professional relationship and boost the business success of both you and your supplier. As the FSB makes clear, building strong working relationships with a business partner, or potential business partner, is almost always a worthwhile investment.

2. Keeping an Eye on the Performance of Key Stakeholders in Your Business

It is not only the performance of your own business that you need to watch. Monitoring the ongoing performance of key stakeholders, such as suppliers, has two main advantages. Firstly, it helps ensure you are picking the best counterparties. Secondly, a deeper knowledge of their performance indicators can be a very useful contract negotiating tool.

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3. Prioritisation Is Crucial to an Efficient Business

Almost all aspects of business management depend on effective prioritisation. Monitoring contractual performance is no different. Allowing yourself to spend too long, or too much money, on less significant contracts can sap you of time, energy and funds that would be spent more effectively on other contracts.

4. Making Effective Use of Supplier Management Software

The efficient use and organisation of contractual information makes a significant difference to the management of those contracts. The best Supplier Management Software ensures that relevant information is stored securely, sensibly and efficiently. This not only means it is protected from unauthorised access but is easy to access and navigate by those individuals who need to do so.

5. Keeping Senior Management up to Speed

Excellent contract management ought to include a reporting template designed to keep senior management up to date with developments and for them to receive relevant recommendations.a