What is Contract Management?
Contract management is a profession that includes many positions along the buying and selling chain, including jobs within the federal government, industry, commercial businesses, academia, and more.
Contract management professionals strive to:
– Manage customer and supplier expectations and relationships,
– Control risk and cost, and
– Contribute to organizational success.
Contract management integrates a broad set of business disciplines and involves working closely with all areas and departments within an organization.
Watch this quick YouTube video to learn more about the profession:
Is procurement the same as contract management?
Procurement and contract management are actually mirror images of each other. Both professions describe the broader process of sales or acquisition between two parties. Some objectives of buyers and sellers are distinctly different, while others are surprisingly similar. A mutually beneficial contract can often be challenging to craft. Buyers want the lowest price, whereas sellers want to maximize it. Both, however, should strive to meet one another’s quality, delivery, and performance expectations. Working together, they form a group of professionals under the “procurement” umbrella.
Procurement consists of evaluation and selection of suppliers based on availability, reliability, and price to obtain the highest quality products at the lowest price. Buyers attend trade shows and conferences and they visit suppliers’ plants to examine products and stay abreast of industry trends. They must develop a working technical knowledge of the goods or services they buy. Often, they forge a strong working relationship with their supplier counterparts—the contract managers—to optimize the outcome for both parties.
Contract management is a niche within the procurement profession, but it spans a very broad spectrum in terms of the responsibilities assigned to a contract manager. The job scope ranges from the administrative skills of managing, organizing, and planning, to the excitement and challenge of negotiating a major contract.
Both procurement and contract management demand competence in such areas as contract law, administration, accounting, psychology, management, and planning. For more details on who contract managers are and what they do, read more about the skills you will need in the profession.