Contract & Commercial Management - the seller side Christian Sandbeck 20 nd October 2009.

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Presentation transcript:

Contract & Commercial Management - the seller side Christian Sandbeck 20 nd October 2009

Agenda Short introduction to CSC Contract & Commercial Management (“CCM”) A core function in CSC What defines best CCM practice? How CSC implements best CCM practice Good and bad experiences with CCM

90.000Employees worldwide introduced via outsourcing 92 Countries where CSC does business Employees in Nordics Employees in Denmark bank-, finance og insurance companies use programs from CSC 100 % of CSC datacenters are ISO-compliant Short introduction to CSC

Contract & Commercial Management - A Core Function in CSC Contract & Commercial Management (“CCM”): –Is a global organisation in its own right –Reports into the Corporate General Counsel –Regional leads reports into VP for CCM International business –Total of 425 Contracts professionals –Mandated by the Corporate CEO –Contracts that are complex and substantial in size have dedicated CCM support –Close co-operation with IACCM

Contract Administration Contract Management Commercial Management Value add Contract & Commercial Management - A Core Function in CSC

Contract Administration Contract Management Commercial Management Value add Trusted Advisor Contract & Commercial Management - A Core Function in CSC

What defines best CCM practice? “ Contracting is less about words, and more about process” (but what is ‘the process?’ “Complete Visibility into those processes, and precise performance metrics are necessary conditions for managing contracting processes and contracted relationships” Source: IACCM, Tim Cummins,

What defines best CCM practice? Research studies have furthermore indicated that best practice is defined by well defined processes for: –Effective relationship –Transition –Change Management –Performance management –Requirement definitions Source: IACCM, Tim Cummins,

How CSC implements best CCM practice CSC has implemented best CCM practice (visible processes) by the use of : –Governance structure, –Common process, systems and tools –Knowledge sharing/Communication Which incorporates best practice as set on the previous pages…

How CSC implements best CCM practice - Governance structure/Effective Relationship Legal function Service Delivery Account/ Finance CCM

How CSC implements best CCM practice - Governance structure/Effective Relationship –Well-defined career paths To ensure that the highest level of professionalism is maintained, CSC has together with IACCM defined career paths Senior Commercial Managers Commercial Region Directors Contract Specialists (plus junior Contract Specialists) Contract Specialists (plus junior Contract Specialists) Vice President EMEA Contract & Commercial Management Vice President EMEA Contract & Commercial Management Vice President & General Counsel Commercial Managers Commercial Account Directors

How CSC implements best CCM practice Common process, systems and tools CCM Contract handbook ensures that the foundation for contract management is established during the transition phase: –Contracts Administration Responsibilities –Contract Deliverables –Contracts Governance –Contract Interpretations & Issues –Escalated Issues & Disputes –Projects –Contract Modifications –Commercial Contracts Management Databases –Risk Authorizations and Authorizations to Proceed

How CSC implements best CCM practice Common process, systems and tools Contract deliverables focuses on performance measurement and requirement definitions Contract Compliance Matrix database ensures that the contractual baseline is established during the transition phase. –Automation of CSC and client obligations –The contract is broken down into: CSC Obligations Customer obligation Billable items Important contract information (e.g. Order of precedence) Risk items (from the negotiation phase)

How CSC implements best CCM practice Common process, systems and tools Contract Compliance Matrix (cont.): –Every CSC obligation in the contract have allocated an owner address (used for notification purposes) Description of obligations (laymen terms) Due dates Risk exposure Contract Managers will ensure that each owner has a place to go for in case of question on the owners specific obligations

How CSC implements best CCM practice Common process, systems and tools –Common process, systems and tools By using Contract Compliance Matrix database, CSC has a tool which enables: –Constantly monitor contracts with high criticality and complexity, broad scope, and longer duration to ensure they are delivering value as intended –Structured contract audit process which periodically reviews the health of each account against their objectives –Executive reports, regular review of performance and improvements; oversight of ‘troubled’ contracts

How CSC implements best CCM practice Common process, systems and tools –Common process, systems and tools After transition, the contract manager monitors the contractual performance by subtracting reports e.g. : Deliverables due in 30,60,90 days and overdue Missed client obligations –Each owner gets mail notification in due time. –Overdues are escalated through the proper management chains –Obvious benefits: Proactive Ensures that the customer gets the contracted services -> Reduces breach situations

How CSC implements best CCM practice Common process, systems and tools –Common process, systems and tools Contract Modification –To ensure that the contract is always current, the CCM handbook contains a process for contractual change management, which covers elements such as Triggering events Input Execution steps Process for updating the contract compliance database.

How CSC implements best CCM practice Knowledge sharing/commuincation –Knowledge sharing focuses on effective relationships Subject matter experts (SMEs). E.g. experts within SLA/SLC, benchmarking, pricing models Database with templates and checklists In the transition phase CCM is responsible for ensuring that important contract information is conveyed to the Account Team, e.g. –Contract value –Flow downs to subcontractor –Unusual terms and conditions –Billable items –Etc, etc –Consistent communication(both internal and external) Newsletters for internal use, covering items such as new article on CCM, promotions, internal articles on lesson learnt Account communication covers items such as substantial changes to the contracts, information about the Contract Compliance status

Good and bad experience with CCM –Bad experiences N/A –Good experiences with CCM CCM has been engaged early in the negotiation phase(e.g. DD), to ensure that the intention of the contract is understood Management of the contract has been considered in the negotiation phase. Not to many “to be agreed within 30 days after the Effective Date” please The Customer has engaged professional Contract & Commercial Managers

Question and Answers