ABSTRACT
Contract management is a critical part of the procurement cycle and a good contract management plan can assist the procurement staff to manage contracts by addressing transition management, and performance monitoring and help to ensure that both parties fulfill their commercial and contractual commitments. Performance monitoring, also referred to here as supplier performance management, directly affects the quality of the whole supply chain, as companies rely on timely delivery, price reduction, and service quality offered from their suppliers. In this chapter, we will discuss how contract management focusing on supplier performance can minimize waste and improve efficiency in a supply chain. To manage this entire process, the Chartered Institute of Procurement & Supply contract handbook identifies all activities associated with contract management, from the establishment of the business case and the confirmation of need, through contract administration and relationship management, to the review of contract performance.
