What Is Contract Administration? Key Processes And Practices
Anyone who has ever worked on large-scale construction projects would be familiar with the concept of contract administration. For those who need more clarity: When a company hires a contracting firm for working on a particular project, the two parties’ partner and sign an agreement on how long a project will take, what work would be involved, its scope, value, and so on. All the necessary details are outlined and then solidified in an official contract. Contract administrators create official documents to protect both parties if anything goes wrong or needs to be altered.
The role of a Contract Administrator
Contract administrators have extensive knowledge regarding contract laws and business finance. .
The duties of a contract administrator vary depending on the type of construction project and contract. Overall, contract administrators are responsible for providing updates regarding contracts, managing disputes, making impartial and fair decisions, and coordinating with various departments. They also communicate expectations, set quality standards, analyze risks, and set meetings. Here are some recommendations regarding the best practices for contract administration.
Contract Administration: Best Practices
#1- Familiarize Yourself with the Project
Before beginning your role as a contract administrator, you must understand the project’s scope and context of the contract. This helps answer questions and resolve issues during the process while enabling the adjustment of strategies according to the project’s size, types, and more.
#2- Prepare for the Unexpected Outcomes
There are many extra precautions contract administrators can take to ensure they remain a step ahead at all times. They must prepare for unprecedented situations where contractors or employers want to make significant changes to the contract. Professional contract administrators usually tend to already have a system in place for how to proceed in such situations.
#3- Include a Detailed Timeline
Contract administration plans must include a detailed timeline that accounts for every critical milestone throughout the contract’s life, including the project’s starting and ending dates, deliverables’ deadlines, and progress updates.
#4- Sort Out the Finances
To maintain positive relationships and avoid contract disputes between the concerned parties, every stakeholder must be aware of the financial terms of the agreement, including the payment intervals, contract’s value, and the process to address the need for additional expenses, depending on the type of contract.
#5- Anticipate the Potential Risks
While each contract comes with considerable risk, putting contingency plans to account for the risks in advance can prevent contract failure. Outline the potential risks for each contract and the steps needed to be taken if such events occur. Building in some flexibility for budgets and timelines will allow for minor, unexpected problems or delays to be taken in stride to prevent the contract from being negatively impacted.
Whether you are looking for contract management services or contract administration services, experts at ADDMORE Services can help ensure all of the firm’s agreements are created, organized, executed, monitored, and optimized according to the company’s and industry standards.
Businesses in the UK, the USA, the Republic of Ireland, Australia, New Zealand, the Middle East, and various other regions worldwide can spend less time on tedious contract administration and more time on high-value, strategic initiatives with cost-effective and high-quality offshoring and outsourcing solutions offered by ADDMORE Services.
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