In this and the next few blogs I will discuss how contracts are administered.
The list below relates the PMI’s processes relating to procurement with the actual activities that take place within them.
1. Plan purchases
2. Prepare bid documents
3. Distribute bid packages
4. Bidders’ conferences
4. Receive responses
5. Evaluate proposals
6. Interview bidders
7. Conduct negotiations
8. Award contract
9. Determine work start date
10. Manage contracts
11. Review performance
12. Claims administration
13. End contracts
14. Lessons learned
PMI uses the term ‘Administer Procurements’ to mean ‘contract management.’ Administration begins after a contract has been signed and involves the oversight of contract work, including performance measurement.
Contract administration is over when the contract is completed or work is terminated. The primary output of this process is completed procurements.
Working the Contracts
To administer contracts is to manage them. Administering procurements is the act of working contracts that have been signed. It is ‘contract management.’
Responsibilities include the oversight of performance and payments, monitoring of progress and assessing quality, all while preserving a good working relationship with the vendor.
Because a contract is a legal document, it is necessary for everyone to know how actions taken by either party will affect that legal relationship.
Controlled by Procurement Professionals
Like in ‘conducting procurements,’ the administration of contracts continues to be led by staff from the procurement department. The point man from the procurement department is typically referred to as the contract manager. PMI refers to this role as the procurement administrator.
The procurement administrator handles all official communications between the project and vendor management.
To be Continued…