1. Global Contract Management Commercial Contracting Conference 2003
Ron Smith
Commercial Contracting Conference 2003

2. Global Contract Management
Management processes & cycles
Project cycles
Contract cycles
Contract management relationships
Organization options
Global Contract Management issues

3. Project Cycles
Reference Text, pg. 78

4. Typical High-Tech Commercial Company
Project Cycles (cont.)
Typical High-Tech Commercial Company
Reference Text, pg. 78

5. Project Cycle Phases Control Gates New Initiative Approval
System Concept Approval
System Specification Approval
Production Approval
Operational Approval
Reference Text, pg. 78

6. Contract Management Cycle
World-Class Contracting, by Gregory A. Garrett, CCH, 2001

7. Contract Management Relationships (organizational)
Executive Management
Law Department
Product
Management
Maintenance
Support
Contract
Manager
Factory
Consulting Services
Professional
Services
Non-Standard
Terms & Conditions
Pricing

8. 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

9. 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

10. 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

11. 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

12. 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

13. 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

14. 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

15. 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