Global Contract Management Commercial Contracting Conference 2003 Ron Smith Commercial Contracting Conference 2003
Global Contract Management Management processes & cycles Project cycles Contract cycles Contract management relationships Organization options Global Contract Management issues
Project Cycles Reference Text, pg. 78
Typical High-Tech Commercial Company Project Cycles (cont.) Typical High-Tech Commercial Company Reference Text, pg. 78
Project Cycle Phases Control Gates New Initiative Approval System Concept Approval System Specification Approval Production Approval Operational Approval Reference Text, pg. 78
Contract Management Cycle World-Class Contracting, by Gregory A. Garrett, CCH, 2001
Contract Management Relationships (organizational) Executive Management Law Department Product Management Maintenance Support Contract Manager Factory Consulting Services Professional Services Non-Standard Terms & Conditions Pricing
Contract Management Relationships – Interpersonal Leasing Compaq Capital Gerry Miller / FAM Legal Attorney US Pricing AM, NASM & RFM Service Bid/Win & Sales Service Manager Global Issues B. Seidle Global Miscellaneous BEM / Account Team Direct Model P. Hashway Acct Mgmt Issues Account Team Product / Technical ETSS / SE Product Marketing ETSS / BEM Product Div. For $ and roadmap input Mfg., IM, EDI, ExtraNet, Delivery, etc. Other GEO's for global capabilities WW Pricing D. Mol / Bus Mgmt Group Senior Financial Approval Contract Manager
Adapted from Reference Text, pg. 136 Organization Options: Functional (Skill Centers) Strengths Skill Development Technology Development Technology Transfer High personnel loyalty Weaknesses No dedicated customer interface Unclear Project Priority Confused communication Difficult Schedule/cost controls Adapted from Reference Text, pg. 136
Adapted from Reference Text, pg. 137 Organization Options: Functional (Product/Services Centers) Strengths Product/Service development Technology development High personnel loyalty Weaknesses Unclear customer interface Difficult technology transfer Unclear project priorities Confused communications Difficult schedule/cost controls Adapted from Reference Text, pg. 137
Adapted from Reference Text, pg. 138 Organization Options: Pure Project Strengths Clear Accountability Clear Customer interface Strong Controls Strong Communication Dedicated resources Weaknesses Talent duplication Less Technology awareness Reduced functional development Irregular workloads Higher staffing levels Adapted from Reference Text, pg. 138
Adapted from Reference Text, pg. 140 Organization Options: Conventional Matrix Strengths Single point of contact Clear Customer interface Quick response Reduced duplication Technology transfer Disbanded easily Weaknesses High management skill required Competition of resources Management cooperation required Reduced employee recognition General Manager Project Mgr. A1 Project Mgr. A2 Project Mgr. A3 Program Mgr. A Engineering Manufacturing Marketing & Sales Contracts & Legal Finance Adapted from Reference Text, pg. 140
Adapted from Reference Text, pg. 141 Organization Options: Collocated Matrix Strengths Single point accountability Clear customer interface Good control Single location High level of teamwork Weaknesses Reduced technology awareness Reduced management support Reduced functional sharing Staffing irregularities Higher costs (Relocations) General Manager Project Mgr. A1 Engineering Manufacturing Marketing & Sales Contracts & Legal Collocated Adapted from Reference Text, pg. 141
Organization Options: Summary Numerous possible organizational structures/designs No single-best solution for all situations Organizational structures must vary depending upon the size, complexity, and phase of the project cycle Organizational Spectrum Functional (Skill Centers) Organization Functional (Product/Services Centers) Organization Conventional Matrix Organization Collocated Matrix Organization (Hybrids) Integrated Project Team Organization Pure Project Organization
Global Contract Mgmt Issues Centricities: Language, culture, time-of-day Span of Control Command and Control Priorities, processes, policies Training Institutional support: Logistics Interpersonal support: Coaching, Counseling, Mentoring Fundamental challenge: Corporate governance vs local empowerment/control