When it comes to managing a contract, it is the duty of the contract manager to ensure all the involved-parties do not break any rules. Moreover, the contract manager also needs to negotiate terms, write contracts and more responsibilities. Let’s focus on some of the basic information on what contract management really is.
- First, Invitation to Treat – During the first step, ‘Invitation to Treat’ needs to be issued by companies. This is basically a legal term for the company and the vendors to come to an agreement related to products and services.
- Authoring of the Contract – After ‘Invitation to Treat’, vendors or new employees offer their side of the bids in relation to the products and services. Before the vendor is selected, the company needs to review all the bids before it is to be accepted. Once a bid is selected, an arrangement is made by writing a contract comprising of legal terms mentioned.
- Negotiation –Negotiation happens during the authoring of the contract. All the parties need to come together, sit down and discuss about promises, obligations, terms and conditions. At the same time, the involved parties will also be offer their own set of things that benefit them. For instance; a company selling a product to a customer where the company gets its benefit via generated revenue while the customer uses the product and benefits from it.
These are some of the basic information on contract management. In order to go a little basic, you may want to consider procurement training first and then go ahead with contract management later.