It is often difficult to discern the success of a contract when the subject matter of the agreement is more complex than the delivery of a single item in exchange for a payment. A lot of business contracts can last for several years and may involve a series of actions, deliveries, and/or payments from one or both sides. Nonetheless, contract performance is critical to managing a company’s contract portfolio, and it obviously has significant influence on the bottom line. As a result, the contract management team must have clear metrics by which to measure performance. Here are four key metrics that can be used to evaluate contract performance:

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During contract negotiations and drafting, there is a lot of unavoidable back and forth as each side jostles for the inclusion or exclusion of certain terms and conditions. Once the contract begins to take written form, the round and round suggestions and changes can get pretty difficult to keep track of and remember. As a result, it is critical for there to be a coherent data management strategy in place. This is particularly important for contracts and any related documents, as revisions, amendments, and addenda are fairly common practices for these kinds of documents. Here are the three main things to keep in mind to help keep track of contract versions and amendments:

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Although there are several discrete aspects of the contracting process, each phase ultimately intertwines with the others, and each step in the cycle influences the next. The way in which the contract negotiations unfold will no doubt have a massive effect on managing the contracting relationship and overall contract performance. Unfortunately, things can sour rather easily during the negotiation phase, but the contract often has to move forward, as there may not be time to find a new partner or even another firm available that can provide the same goods or services. Here are five common roadblocks in contract negotiations and how to avoid them:

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Maintaining strong relationships with contracting partners is vital for businesses not only to survive but to thrive. Unfortunately, many companies have a rather negative view of contracts and end up approaching the process with a slanted mindset. It is understandable given that for quite some time contracts tended to involve a somewhat adversarial relationship, as both sides focused on jockeying for position and power. These days, however, this has begun to dissipate and there is widespread recognition that the contracting process must entail compromise and collaboration as opposed to competition. Here are four things to keep in mind to achieve successful collaborative contracting:

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The terms contract management and contract compliance are often used interchangeably. Although the two business processes do overlap in many ways, and it is not incorrect to intermingle these concepts, there are some slight nuances to each. Perhaps the easiest way to discern the difference is by thinking about contract management as a more internal process focused on the manner in which a company is managing its own contract portfolio. On the other hand, contract compliance is somewhat more externally focused, as it requires an examination of the performance by the other parties to contracts. Despite these subtle differences, contract management and compliance will always be inextricably intertwined as each facet continuously influences the other, as discussed below.

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Choosing the right vendors is often critical to your company's success. Disorganized partners and bad relationships can lead to costly performance interruptions and even ruined reputations. Sometimes vendors are selected in haste or the firm that is offering the lowest price is chosen, but the old saying that you get what you pay for must be heeded. Here are four best practices when it comes to vendor management:

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Contracts are critical legal instruments for companies of all sizes in virtually every sector. Although sourcing, negotiating, and drafting contracts can be quite a tedious process, contracting does not end once the agreement is put to paper. In fact, the real work begins once all parties have signed the final documents. To ensure that the terms and conditions of a contract are being performed as stipulated, it is crucial to conduct periodic audits. This may be done at a micro level (i.e., by contract) or at a macro level (i.e., a review of the entire portfolio). Here are some of the key points to consider to perform a contract compliance audit:

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Contract management is a complex task, especially in large organizations that have large volumes of contracts. Contract managers strive to supervise performance goals, financial benchmarks, and risk management. Be sure to watch for these commonly overlooked areas of contract management.

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Drafting a sound contract often requires seemingly endless negotiations and countless versions of the agreement before all parties are satisfied. But, despite spending days, weeks, or even months getting a contract into a mutually acceptable format, circumstances often arise necessitating some sort of amendment to the existing contract language. It is important to remember that an amendment changes something in the contract, as opposed to an addenda which would involve making additions to the contract.

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