Five Common Pitfalls in Contract Management & How to Avoid Them

Hi there,

Hope you're doing well. It's been 4-weeks since the last edition of Procurement Pulse: Five Things. Although a failure on my fortnightly content commitment, as you can see we've launched at OneAdvanced with a refreshed look and excitement on how we continue with our mission of 'Powering the World of Work'.

Recently, I was part of an enlightening webinar, this time zooming in on the area of contract management. From California to Mumbai, we had a fantastic turnout of procurement leaders. They represented a variety of sectors including Utilities, Pharmaceuticals, and even a cutting-edge robotics company.

Late-night webinar for me, but the hot coffee keeps the conversation flowing!

Let's dive into the five common pitfalls in contract management and how to avoid them, as discussed in our webinar:

1. Poor Visibility and Tracking: One of the most common pitfalls in contract management is losing track of contracts. To avoid this, consider using a contract management system to maintain a central repository of all contracts and enable easy tracking and retrieval.
2. Inadequate Risk Management: Failing to identify and manage contract risks can lead to serious consequences. The solution? Implement a comprehensive risk management process for contracts, involving risk identification, assessment, mitigation, and monitoring.
3. Lack of Standardised Processes: Without standardised contract management processes, organisations can face inconsistencies and errors. To avoid this pitfall, establish standardised processes for contract creation, approval, execution, and management.
4. Limited Stakeholder Engagement: Lack of stakeholder engagement can lead to misunderstandings and missed opportunities. Avoid this by ensuring regular communication with all key stakeholders, understanding their needs, and keeping them informed about contract status and issues.
5. Failure to Monitor Performance: Contracts are not just legal documents; they are also tools for managing supplier relationships and performance. Failing to monitor contract performance can lead to missed targets and poor supplier performance. Use KPIs and regular reviews to ensure contracts are delivering as expected.

While these points capture some of the key takeaways, they highlight the importance of effective contract management in procurement.

Additionally, here's three (3) trending articles on technology in procurement.

1. Procurement predictions and the role of technology in 2023
2. What makes a supplier the right choice?
3. 6 Valuable data points you need to extract from your contracts

Keep an eye out for the next issue of 'Procurement Pulse: Five Things' where we'll continue to delve into the exciting world of procurement and technology.

All the best,

Mark

Mark Reddy

Global Director of Growth - Spend & Governance

Advanced

W: www.oneadvanced.com/solutions/spend-management/

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