This is the third and final paper in this series, looking at how executives can make a compelling business case for investment to improve contract management performance in their organisations. The first paper introduced the key concepts of contract management, particularly the idea that it should focus on managing opportunities and risks.
The second paper then explored the whole area of opportunity, so in this third paper, we look at the risks inherent in most major contracts. They include risks under various headings, which we define here as performance risk, commercial risk, reputational risk and strategic risk. Effective contract management can generate real value by helping to mitigate, manage or remove these risks. So identifying and quantifying the issues, and understanding how contract management can change that risk profile, forms the second major element of the business case.
Finally, we revisit the entire business case format, and conclude with a brief summary of the message that runs through all three papers – the value of effective contract management to every organisation.