Contract Logix | Contract Management Software

How to Improve SOW Change Management

Qtq80-ttrhtd

  • Mar 3, 2014
  • Justin Perkins

In a related article, we discussed the importance of taking steps towards improving the statement of work of any contract to improve your contract management process. It showed that the more detailed the SOW, the lower the probability that a project will run over budget or timeline.

However, there are still situations in which a change may be necessary for the benefit of all parties. This is why the SOW also needs to include the agreed-upon process for a change order and variation order form. In this article, we will explore the field of change management relative to SOWs.

Editor’s Note: To learn more, download our whitepaper on contract management best practices .

A Closer Look into Change Management

The IACCM provides a great definition of change management , which is “change management is based on a voluntary agreement over whether or not a change can be agreed between the parties”.  The process of whether changes to the scope of a project are formally introduced and approved shouldn’t be seen as a complete breakdown of the contract. Instead, it should be viewed as an inevitable and necessary event toward streamlining a business relationship.

Within change management, there is also claim management, which has some similarities but also several differences. Unlike change management, claim management is a legal process that is triggered by the refusal of one party to implement certain changes, and that is based on contractual stipulations.

Objectives for Successful Change Management

From the definitions of change management and claim management, managers should realize that there are several necessary steps to improve these processes. The IACCM suggests the following objectives of successful change management and claim management :

  • Establish a culture that creates a non-hostile and transparent process for managing changes and claims
  • Establish clear ownerships, accountability and responsibility for change and claim management
  • Design processes and activities that align with business, organizational and project management processes
  • Establish a single focal point for change and claim management
  • Establish a closed loop between change and claim management processes and the development of products, services, process, and contract quality to reduce — while not necessarily eliminating — the sources of change and claim management events

Using these 5 objectives as guidelines, an organization can improve how it manages changes to any contract or SOW.

Sample Change Management Process

Just like it is important to have contract templates in your  contract management software , you also need to have a sample template for change procedures. Christian Sandbeck and René Franz Henschel developed a useful template based on the body of knowledge from the IACCM, the Information Technology Infrastructure Library, and the Universities and Colleges Information Systems Association :

  • Record all details for the request for change (e.g.person making request, reason, timeline, etc.)
  • Establish whether or not the request for change is within the existing contractual framework
  • Evaluate the urgency and required contractual changes along with their financial, contractual and operational impact
  • Make decisions to authorize or reject the change through established approvers
  • Coordinate the implementation of change or information that change is not accepted as well as the different steps that must be taken from the different internal and external parties
  • Have changes been made according to the agreement (or rejected)?
  • Have goals been reached?
  • Are all parties satisfied?
  • Were there any surprising effects?
  • Was there a cost overrun or delay?
  • What was the cause for the change request?
  • Were the contract terms sufficient?
  • Did product or service quality exist? How about process or communication quality?
  • Is there room for improvement in the change process (process, contract, communication etc.)?
  • Can change be recorded as completed, or do we need new change( or maybe a claim management process)?

It’s important to note that the last step is the most critical in the change management chain. This step provides essential takeaways for improving the business relationship, suggesting the course of action in other similar events, and measuring the overall impact of the change.

Change management is a necessary part of contract management and should not be viewed as an isolated event. Not only should change management be part of your contract management lifecycle, but it should also be a source of learning to improve the overall contract lifecycle.

Contract Logix

By clicking “Accept” , you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. View our Privacy Policy for more information.

SpotDraft Logo

Navigating Contract Change Management in Dynamic Business Environments

Download the free template.

contract change management

It is true that business teams and legal professionals spend ample time painstakingly drafting contracts to establish a clear framework for business engagements. However, unforeseen circumstances, changing legal dynamics, evolving project requirements, and other external factors can sometimes arise, necessitating changes to the original agreement.

Yet, making changes to contracts is not exactly a cakewalk, even for top legal professionals. You have to deal with difficult stakeholders, who may be nonchalant about participating in the contract change process, convincing them of the need for the adjustment and its critical implications. You also get to contend with the risks associated with the modifications, combing through multiple lines to ensure you don't inadvertently introduce avenues for ambiguities, non-compliance, and conflicts.

In light of this, organizations ought to establish proactive processes that keep contracts flexible and adaptable in the face of changing circumstances, and that is what effective contract change management is all about.

In this guide, we’ve discussed all you need to know about contract change management and how you can get the best outcomes with it.

What is contract change management?

Contract change management refers to the process of identifying, planning, implementing, and managing modifications in a contract after its initial execution.

When a contract hits the execution phase, a legally binding transactional relationship gets established between the parties involved. This phase signifies the point at which all parties are obligated to fulfill their agreed-upon responsibilities as outlined in the contract. However, certain events may occur while fulfilling these contractual obligations, bringing about the need to make changes to the contract's content.

At this point, the overarching aim of contract change management will be to ensure that modifications are incorporated into the contract without elevating risk, disrupting established relationships, or violating regulatory standards.

 “Regardless of when you see them coming, material changes will require that the team adjust the project plan and related documents to account for the change, and ensure that changes are communicated to all of the people who need to know and – most importantly – changes are approved in advance by the right people.” ~ Sterling Miller, CEO and Senior Counsel for Hilgers Graben PLLC Ten Things: Legal Project Management for Beginners

What can necessitate a contract change?

What can necessitate a contract change?

Contract changes are a common occurrence in the world of modern business. As companies seek to establish and maintain legally binding corporate relationships in a constantly evolving business landscape, the need to modify and adapt contracts frequently arises. 

These changes may stem from various factors, such as shifts in market conditions, technological advancements, and legal modifications, among others. In the same vein, contract changes are not only a response to evolving circumstances but also an opportunity for businesses to strengthen their partnerships and enhance the value they provide to one another.

Below, we get into the specifics of things that can necessitate a contract change.

#1 Changes in scope

One of the most common reasons for contract changes is a shift in project scope. As projects progress, stakeholders might realize that additional features, tasks, or services are needed. Similarly, they might find that certain elements initially deemed necessary are no longer relevant. 

Adjusting the contract to reflect these scope changes helps ensure that both parties are on the same page and that the project can adapt to evolving needs.

#2 Shifts in market conditions

Market conditions encompass a wide range of external factors that can influence the way businesses operate and interact with each other. These factors include economic changes, industry trends, and supply chain disruptions. These can sometimes be unpredictable and significantly impact the terms of a contract.

For instance, a supplier might need to alter the terms of a supply contract to account for shortages or price changes in raw materials.

#3 Performance issues

If one party fails or struggles to meet its obligations outlined in the contract, parties may decide to go back to the drawing board and adjust specific areas to ensure that objectives and responsibilities are seamlessly delivered. 

Performance issues could encompass a wide range of problems, from missed deadlines and quality deficiencies to incomplete tasks or inadequate services. To rectify the situation and salvage the business relationship, both parties might agree to modify the contract terms, such as adjusting timelines or quality standards.

Sometimes performance issues could even result from events beyond the control of either party, like natural disasters, strikes, or global pandemics. In such cases, contract modifications might be necessary to accommodate delays, adjust deadlines, or even suspend certain obligations until conditions improve.

Also read: Managing Contract Performance: Tips + Tools for Success

#4 Change in the legal or regulatory environment

Jurisdictional regulations and industry standards governing a specific subject matter of a contract may evolve over time. These changes can impact the validity, enforceability, or practicality of terms contained in the agreement.

Imagine a contract between a technology company and a data storage provider. If new data protection regulations requiring stricter security measures for handling customer data are enacted, the original contract might need to be modified to ensure that the data storage provider complies with these new regulations.

This could involve updating the security protocols, revising the data breach response procedures, or implementing additional safeguards. Failure to make such adjustments could result in legal non-compliance and potential liabilities for both parties.

Changes in the legal or regulatory environment can impact the risk landscape associated with a contract. Parties may need to negotiate new terms to allocate risks appropriately, ensuring that both sides are protected from any new legal exposures.

#5 Changes in organizational goals or ownership structure

Over time, a company's goals, strategies, or even ownership structure may change. These shifts can impact existing contracts. 

For instance, if a company goes through a merger or acquisition, the newly formed entity might seek to streamline its operations and consolidate relationships. This could lead to renegotiating contracts with suppliers, service providers, or customers to reflect the new combined organization's priorities and strategies. 

Similarly, if a supplier or service provider experiences significant changes, they might seek to modify existing agreements to align with their new direction.

Key steps for contract change management

Key steps for contract change management

As already established, contract changes can occur for a wide variety of reasons, and the overarching goal of effective contract change management is to ensure that changes are incorporated without elevating risks, disrupting core processes, or souring relationships.

But what are the steps involved in this mission-critical process? We will describe these using an illustration.

Company X , a software development firm, has been contracted by Client A to build a customized e-commerce platform. The project is expected to last 12 months and involves a team of developers, designers, and project managers. The initial contract outlines the scope, deliverables, timeline, and payment terms for this engagement.

#1 Identification of change requirement

Three months into the project, Client A contacts Company X with a change request. The project scope has evolved, and they want to integrate a new payment gateway that was not included in the original scope. 

The change request is documented in detail, outlining the reason for the change, the expected benefits, and any potential impacts on the project's timeline and budget.

#2 Change request evaluation

The project manager at Company X reviews the change request and assesses its feasibility. They analyze the technical requirements, evaluate the potential impact on the project's timeline, budget, and resources, and consider the compatibility of the new payment gateway with the existing system. 

The project manager also consults with the development and design teams to gather their input.

#3 Assessment of impact

Based on the evaluation, the project manager presents the findings to both the internal team and Client A. They outline the potential impacts of integrating the new payment gateway, including the need for additional development hours, potential delays, and any adjustments required in the project plan. 

Client A's representatives express their urgency in implementing the new payment gateway due to market demands.

#4 Negotiation and approval of the change request

Client A and Company X engage in a discussion about the change request. They negotiate the revised terms, which include an extension of the project timeline by two weeks and an increase in the budget by 15% to cover the extra development hours. Both parties agree to the new terms and formally approve the change request.

Also read: Mastering the Art of Contract Negotiation—Strategies for Success

#5 Formalization and documentation by the legal team

A formal contract change document is drafted by Company X's legal team. This document outlines the agreed-upon changes, including the new scope, timeline, budget, and any adjustments to deliverables. Both parties review and sign the document, indicating their consent to the changes.

#6 Implementation of changes

The development team at Company X begins working on integrating the new payment gateway. The project manager closely monitors progress to ensure the project remains on track despite the extended timeline. 

Regular communication is maintained with Client A to keep them informed of the updated development process.

#7 Post-change evaluation

After a defined period, Company X and Client A hold a post-implementation review. They assess the effectiveness of the change, whether it has met its intended goals, and whether any unforeseen issues have arisen. 

Lessons learned from this change management process are documented and shared with relevant stakeholders to improve future change management endeavors.

Pain points associated with contract change management

Pain points associated with contract change management

Making changes to a contract might seem easy on paper, but this is not usually the case. Contracts are very delicate documents capable of impacting organizations in significant ways. Yet, even the most experienced professionals run into roadblocks sometimes when trying to manage changes throughout a contract’s lifecycle.

Below are some common pain points you may face during contract change management.

#1 New risk potential

“If you're at a start-up, for every 3 projects you plan for Legal, 2.5 come at you by surprise. No matter how well prepared, how big your legal team, or how mature the company, there will be things that you can't anticipate. Because on that risk matrix, there are 100 different risks, from employment to data privacy to contractual to bank system collapse. As a legal team, budgeting for the surprises as well as for the day-to-day is a really delicate balance.” ~ Megan Niedermeyer, Apollo.io Aligning Legal's Limitless Potential to Business Goals

Making changes to a contract can potentially introduce new risks that were not initially present . These risks might stem from altered obligations, changed timelines, or modified deliverables.

New terms or conditions may conflict with existing laws, industry regulations, or contractual obligations, exposing the parties to legal liabilities and potential fines. Additionally, contract changes come with risks of misinterpretation and disputes by stakeholders, especially when the atmosphere around the project is already tense.

Furthermore, stakeholders have to worry about the impact of the change on the overall outcome of the business engagement.

Also read: Legal Risk Management—From the Playbook of 11 GCs & Leaders

#2 Dealing with stakeholders

Contract changes often involve multiple stakeholders, including the contracting parties, legal teams, project managers, and possibly external consultants. Each stakeholder may have differing opinions, interests, objectives, and concerns related to the proposed changes.

Managing these varied perspectives and ensuring effective communication among stakeholders can be challenging, as some of them could be resistant, hesitant, or nonchalant about their role in the entire process.

“‍My advice is to understand which stakeholders you’ll have maximum friction with and then adjust and lean in. Try to align the legal roadmap with their goals. In case of conflicts, make sure you’re both seeing it as a partnership. Help them understand and navigate legal risks. Also, make sure they feel educated and comfortable in making decisions (or, if they’re not the decision maker, help them resolve and get to YES).” ~ Ryan Nier, General Counsel, Pinwheel Putting Legal on the Map in a Hypergrowth Startup

#3 Consumption of time and resources

The process of evaluating, negotiating, and implementing contract changes can consume a substantial amount of time, effort, and resources. This challenge arises due to the various steps and processes required to assess, negotiate, document, and execute the changes.

First, the team will need to evaluate the potential impact of the proposed changes on the project scope, timeline, budget, resources, and other relevant aspects. Once the assessment is complete, negotiations between the parties will ensue. This negotiation process can take a long time, particularly if multiple stakeholders are involved or if disagreements arise.

Afterward, you’ll deal with revisions, legal documentation, and approval processes. These individual processes can be time-consuming, resource-intensive, and operationally disruptive.

#4 Scope creep

This refers to the gradual expansion of project requirements beyond what was initially agreed upon. Scope creep can occur when changes to a contract lead to unintended additional requirements, tasks, or responsibilities. 

This can result in increased costs, delays, and potential conflicts if the parties disagree on whether the new scope should be accommodated within the existing contract or treated as a separate arrangement.

“As circumstances change or facts become known, good LPM must plan for and have a process to capture changes and to avoid/contain “scope creep” (i.e., unapproved/un-vetted deviation from the project plan).” ~ Sterling Miller, CEO and Senior Counsel for Hilgers Graben PLLC Ten Things: Legal Project Management for Beginners

Best practices for effective contract change management

Best practices for effective contract change management

Contract change management is a pivotal process that can significantly impact an organization on all fronts—legal, financial, operational, and reputational.

To ensure that contract change processes are managed productively, certain measures must be put in place. We discuss them below.

#1 Establish a clear contract change management policy

A well-structured contract change management policy provides a standardized approach to handling contract changes. It enhances the organization's transparency, accountability, and consistency, leading to more effective and productive contract change management processes.

Establish a clear and well-defined policy outlining the procedures, roles, responsibilities, and approval levels for managing contract changes. This policy should be communicated to all relevant stakeholders, including legal, procurement, finance, and project teams.

#2 Maintain thorough documentation of every change-related activity

Keep a comprehensive record of all activities related to the contract change procedure, including change requests, approvals, negotiations, correspondence, and updated contract terms. This level of documentation fosters transparency, mitigates risks, and ensures that the organization is well-prepared to address inquiries, audits, and legal matters related to contract changes.

For this purpose, we strongly recommend using SpotDraft’s cloud repository system , which is specifically built to help you store your contracts in a secure, organized, and searchable manner.

Alongside offering centralized documentation, SpotDraft also has version control capabilities that show you a comprehensive history of all changes the contract has undergone throughout its lifecycle, including timestamps, amendments, and details of stakeholders involved in each change process.

It includes powerful search functionalities that allow you to search for files using full text or filter documents by last modification time, document type, ownership, etc.

Furthermore, SpotDraft safeguards sensitive contract information through end-to-end encryption and stores your documents in compliance with the highest security standards. You can also leverage features like access control to ensure that stakeholders can only access the data they need to play their roles throughout the contract lifecycle.

Also read: Contract Repository—Everything you Need to Know

#3 Automate routine processes

Contract change management processes can get more efficient when you leverage automation to streamline routine processes like document generation, notifications, escalations, approval workflows, and tracking, among others.

Automation increases scalability and productivity while reducing risks, costs, and errors.

You can utilize separate tools to automate these processes individually. However, we recommend leveraging a robust platform that consolidates multiple automation functionalities to cater to your automation needs from one interface.

SpotDraft is an all-in-one CLM that helps you streamline every aspect of your contract management. To do this, it comes packed with a wide range of automation functionalities.

For instance, you can utilize SpotDraft’s automated approval workflow to get contract changes “okayed” by relevant stakeholders after negotiations. SpotDraft will send automated notifications and reminders to ensure the stakeholders are followed up adequately.

Also, SpotDraft’s AI review tool will automatically scan your updated contract to flag any potential risks associated with contract changes, alerting stakeholders to potential legal, financial, or operational concerns.

Other processes you can automate with SpotDraft include reporting and analytics for post-change evaluation, clause integration for formal documentation, audit trailing for tracking contract changes, etc.

Also read: Contract Management Automation—Best Practices + Tools

#4 Maintain communication and transparency

Maintain open and transparent communication with all parties involved in the contract. Keep them informed about the proposed changes, reasons for the changes, and the expected outcomes.

Let them understand the potential impact of proposed changes on various aspects, including legal compliance, financial implications, project timelines, and operational processes. Also, ensure that relevant stakeholders are carried along throughout the change management process, including legal experts, finance professionals, project managers, and senior management. 

#5 Establish a schedule for reviewing your contract change management process

“If you think that you're doing everything perfectly, you're not going to grow. There's always an opportunity for self-improvement.” ~ Doug Luftman, ex-DGC, DocuSign The Key to Success as an In-House Legal Counsel & Leader

After implementing changes, conduct a post-implementation review to evaluate their effectiveness. Use lessons from the process to continuously improve your change management strategies for future projects.

Continuous improvement is the cornerstone of effective contract change management. By consistently refining your contract change management strategy, you will ensure that your contracts remain aligned with your organization's objectives, foster efficiency, and seamlessly adapt to changing circumstances.

Wrapping up

Change is fairly common in a wide variety of contracts. This is why there's usually a change management clause in many contracts. The goal of contract change management is to ensure that organizations are proactively prepared for potential contractual modifications and that any initiated adjustments are carried out with minimal risks on all fronts.

SpotDraft is your great ally in all this, helping you overcome common bottlenecks in every area of contract management, from the initial drafting and execution to future renegotiation and modification processes.

We're happy to give you access to a personalized demo if you’re curious about how SpotDraft fits into your organization's contract change management strategy. Click here to connect with us!

“I have seen a demo of SpotDraft’s CLM technology and they should be on your short list of vendors to talk to about a contract management system.” ~ Sterling Miller, CEO and Senior Counsel for Hilgers Graben PLLC Ten Things: “Cool Tech” For In-House Counsel

Related content

contract change management

Clause for Alarm? 😱

contract change management

en-US

Make it easier to manage construction.

Successfully navigating change management in construction.

Last Updated Jan 12, 2024

Photo of 2 workers reviewing paperwork at a jobsite

Change management in construction refers to any alteration to the original scope of work after the project has commenced. Whether the changes are simple or complex, they often affect a project's budget, cost, or schedule — and so should be handled carefully to minimize risks and avoid delays.

Table of contents

Why Change Management Matters

There are countless reasons why change orders may occur on a project. An owner could have a change of heart on a design element, a project delay could increase costs or a contractor could begin a project only to realize the original design won't work. Responsibility for any extra costs could depend on what triggered the change order.

While some changes may seem too inconsequential to require a change order, they may ripple out to significantly impact the project in time. For instance, the decision to move a wall from one place to another seems a small detail, but the change to project scope could have significant cost and time consequences. If building that wall did not originally involve an electrical contractor but does in the new location, bringing in that subcontractor could impact both schedule and cost.

When changes happen outside the original contract documents, change orders are needed to alert the owner that the project could cost more or take more time than originally planned . Change management allows contractors to recoup the extra expenses that may come with changing the scope of work.

Steps to a Successful Change Order

Change order processes vary depending on the contractor, the project, or the construction agreement. However, the following are the basic steps involved in managing changes in construction projects.

1. Identify

During a project, it may become obvious that the original contract will no longer work. Contractors who come across indicators need to create a change order. No further work should be completed until the owner approves a change order.

2. Document

Calculate the change's impacts. What costs will change? What subcontractors will need to be involved that weren't before? How will the change impact the project timeline?

Take the change order request to the general contractor and the owner with an honest assessment of what might be needed to fix any issues. When decision-makers decide the change is worth pursuing, it's time to get exact costs and further details on how the new plan will pan out.

4. Negotiate

Get a more detailed cost analysis with quotes from subs and materials suppliers. If actual costs exceed the original estimates for the change, some negotiation may be necessary to come to an agreement. After collecting cost documentation, send the information back to the owner for approval.

5. Implement

Finally, notify the field and the subs of the change by issuing a change order document. Make sure any change orders from subcontractors tie back to the original change for accurate billing later on.

On budget, on schedule, and in control.

Build with less risk and bigger profits.

Illustration of construction worker looking at charts on giant tablet

Challenges of Change Management

Contractors often need help to create and maintain change management procedures that work at scale for their employees. Without a consistent process, changes can quickly cost contractors time and money they can't recoup. The following are some of the main challenges to change management for contractors.

Inadequate Planning or Understanding of the Change

Assessing costs for a change in project drawings can be more complex than it seems. A contractor could put together a change order request believing that all costs are accounted for, only to realize later that another contractor will need to be involved in the change. This comes down to a clear definition of the change before starting the change order approval process.

Communicating the Change

If there are no protocols in place for communicating subs and field staff of the change, they could wind up continuing on the original project plan, only to have to backtrack later on to accommodate it.

Tracking Change Orders

Using spreadsheets to track change orders can lead to confusion and miscommunication about the status of a change order. Up-to-date information allows contractors to complete changes with the least impact on the project schedule. Complete data helps the subcontractor bill accurately for all costs associated with the change.

The Pressure to Carry on Without Approval

Contractors sometimes feel so time-pressured that they'll complete work on change orders without waiting for owner or general contractor approval. Changes sometimes seem inconsequential. The situation may be so immediate that there wasn't a chance to do the paperwork. Without prior approval on changes, the contractor runs the risk that the owner will reject the changes entirely, either because the owner doesn't want the extra charges or the contractor can't collect all the necessary documentation for its completion. Approval is necessary to ensure the contractor doesn't get stuck with paying the costs of the changes.

Changes that add to the original construction plan can extend the project timeline, especially if they require the help of a specialty contractor. Even the time it takes to get approvals for changes and alter project plans can delay the project schedule. Proper planning may allow contractors to slot in additional work strategically to avoid major delays.

How to Handle Change Management Better

When managed well, change orders offer contractors the security of knowing they will be reimbursed for costs they may not have previously anticipated. In fact, far from dreading change orders, some savvy contractors bake much of the project profit into their change order procedures. Here are some of the best ways to manage changes for better cost and schedule awareness.

Establish Consistent Standard Operating Procedures

Tracking change orders can get complex and be an ongoing concern for many contractors. Even if a general contractor has their change order process on lock within a specific software product, they have to track all the change orders involving their subcontractors who may not have access to internal systems.

Contractors need clear and consistent procedures to follow regarding all change orders to stay on top of the work and ensure payment on it.

Train Employees on Change Management Protocols

Protocols only work if employees and subcontractors follow them closely. Educate employees on using any forms involved, who to notify about the change, when to follow up, and how to track expenses. Changes should never proceed without express owner approval and the paperwork to back it up.

Review Work Logs

Review daily reports and logs to catch any change order-related expenses that may have slipped through the cracks.

The danger is that changes will go ahead in the field without the administrative staff having any idea it happened. If a superintendent okays a change that's never tracked, any additional time and materials will not be invoiced, shortchanging the contractor on the work.

By going through logs, office staff can catch and follow up on cost overruns to find their source and bill them accordingly.

Follow Changes Over Time

Logging changes is a critical first step in change management, but the process can't end there. Changes should be reviewed regularly to ensure all steps from initiation to payment are complete. This task will often fall to the project manager or whoever is responsible for the project's financial performance. Project management software can help keep changes manageable by allowing users to create potential changes so they're visible between departments and track any time and cost impacts they will have.

Illustration showing framers assembling a wooden wall

Tailor the Contract Documents

Much of the process of change management depends on payment schedules and other contract details. Change order details may be far more critical to a contractor working under a time and materials contract than a lump sum contract .

Some contractors gather all the changes each month to submit a single monthly bill for changes. Changes that are communicated well, tracked consistently and invoiced promptly can help improve cash flow for better project performance.

Contractors must ensure contract documents set them up for success in the event of any alterations to the original plan.

Change Management Procedures Help Protect the Bottom Line

Some contractors may deal with hundreds of change orders on a single project. Changes on a project can be a source of added income — or they can lead to lost time and unpaid expenses. Clear and consistent change order procedures can help builders identify, document, and communicate any alterations to the original construction documents.

Categories:

Change Orders , Construction Contract

Teresa Buturusis

Teresa is a Senior Strategic Product Consultant at Procore. She has almost 20 years of experience in construction finance, working for large general contractors like Alberici Constructors. Teresa has an MBA from University of Illinois Urbana-Champaign.

Kristen Frisa

23 articles

Kristen Frisa is a freelance writer specializing in finance and construction technology. She has helped numerous companies to provide value to their readers and establish their expertise in their industries. Kristen holds a degree in philosophy and history and a post-graduate certificate in journalism. She lives in Ontario, Canada.

Win More Work

Get discovered for relevant work on the Procore Construction Network.

Construction professionals

Explore more helpful resources

article-image

.css-c249p1::before{width:100%;height:100%;display:block;position:absolute;top:0px;left:0px;z-index:0;content:'';cursor:inherit;} Construction Change Directives (CCD): How to Navigate Forced Account Work

Throughout the life of a construction job, there are typically numerous alterations made to the project specs. Typically, these changes are made via change order. However, when there is a...

article-image

How Change Orders Work in Construction 

Completing a change order correctly minimizes risk, improves the chances of approval, and helps contractors get paid faster. The article contains information on how to fill out a change form,...

article-image

Request for Change Orders: Adjusting the Contract Scope

A change order is an agreement made during the course of a job that alters one of three things: the cost, the scope, or the schedule. But before a change...

article-image

Contractor’s Guide to the AIA G701 Change Order

Construction projects can be very unpredictable: Owners can change their minds, or unforeseen issues may come up. To avoid rewriting an entire contract, a change order gives both parties the...

The Essential Guide to Effective Contract Management

By Kate Eby | May 19, 2019

  • Share on Facebook
  • Share on Twitter
  • Share on LinkedIn

Link copied

When you streamline your contract management process, you can boost your revenue and grow your business. Learn the best ways to get the full value out of every contract, no matter what business you’re in.

Included on this page, you'll find a step-by-step guide to the 10 steps of contract management , tips for improving your contract management process , details on how to create your own contract management framework , and much more.

What Is Contract Management?

Contracts govern your organization’s relationships with vendors, customers, partners, and employees. Effective contract management ensures these relationships are efficient and profitable — that your business benefits from every agreement and you get optimal financial returns. It also ensures that the implementation or delivery of every contract, whether a legally binding written or oral agreement, is satisfactory to all parties.

Efficient contract management includes agreeing to, documenting, and reporting on any changes from both buyers and sellers, so you face no disputes or surprises.

Don’t let these productivity killers go unchecked.

Top 3 Productivity Killers Ebook

Uncover the top three factors that are killing your productivity and 10 tips to help you overcome them.

Download the free e-book to overcome my productivity killers

What Is Contract Life Cycle Management?

Contract life cycle management (CLM) covers every step of a contract, from drafting to approval, implementation, utilization, and expiration. CLM is vital to every business. The life cycle has three stages that encompass these actions: pre-award, award, and post-award. Each step creates, contributes to, or uses contract data.

The best contract management processes use the data throughout the life cycle to improve a company’s exposure or ability to manage financial or legal risk. CLM streamlines the process of managing all contracts that affect your business, from internal agreements with employees to external commitments with partners and vendors.

What Is the Contract Management Process?

Contract management touches every business and operations area of an organization. A consistent and efficient contract management process guides and streamlines the management of each contract through all its phases, from creation, negotiation on terms and conditions, and approval, through execution, performance, and compliance on deliverables and deadlines.

Contract management handles any modifications to the contract, as well as its termination. All phases should also ensure customer satisfaction.

What Is a Contract Management Framework?

The standards for contract management may be spelled out formally in a contract management framework (CMF) , which can help guide your organization’s process at a high level. The CMF has four main components that cover a range of activities.

Establishing Governance and the Contract Management Team: Identify the structure, roles, and responsibilities of the team, as well as the resources needed for contract management and any training.

Planning, Establishing, and Executing Contract Administration: Establish and monitor the key components of contract administration in your organization, including checklists, payment standards, and strategies for identifying and mitigating risk.

Managing Relationships: Drive engagement by using communication tools and processes, as well as developing conflict-resolution protocols that build relationships with team members, stakeholders, and partners.

Managing Performance: Assess whether the contract’s deliverables meet the standards spelled out in the contract, and use performance improvement methods to address substandard work.

The scope of contract management covers strategy, sales, performance optimization, and your relationships with customers and suppliers. The National Contract Management Association (NCMA) defines contract management as “the process of managing contracts, deliverables, deadlines, and contract terms and conditions while ensuring customer satisfaction.” It involves many areas of the organization to ensure that you not only meet your operational, functional, and business objectives, but that you profit from every interaction and deliver cost-effective approaches.

The International Association for Contract & Commercial Management puts it this way: Contract management is “a critical vehicle for high-value management information that supports strategic decision making.”

Contract Management Framework

Contract Management Framework Template

The contract management framework is unique to your organization. Identify the key data and deliverables for every contract you manage.

Download Contract Management Framework Template

Excel | Smartsheet

What Do Contract Management Professionals Do?

Contract managers play a vital role in ensuring companies get the full value from every contract. Their responsibilities include the following:

  • Write proposals, analyze data, and respond to partners.
  • Negotiate price, timeline, terms, and conditions.
  • Manage the contract, ensure compliance and implementation, solve problems, and resolve conflicts.
  • Prepare the time and responsibility schedule, as well as manage the team to fulfill the contract process.

The Contract Management Body of Knowledge (CMBOK)®, fifth edition , based on NCMA’s Contract Management Standard™, outlines the competencies for contract managers as the following:

  • Leadership Competencies: These include collaboration and vision.
  • Management Competencies: These include business administration, financial management, project management, and risk management.
  • Guiding Principles: These include skills and roles, contract principles, standards of conduct, and regulatory compliance.
  • Pre-Award Competencies: These include acquisition planning, requesting offers, and business development.
  • Award Competencies: These include price or cost analysis, negotiations, and source selection.
  • Post-Award Competencies: These include contract administration, quality assurance, subcontract management, contract changes and modifications, and contract closeout.
  • Learning Competencies: These include continuous learning, individual competence, and organizational capability.

What Is the Importance of Contract Management?

Contract management affects your organization’s revenue, budget, and operations. It also influences the way your customers view you, as well as your public image. The way you manage your contracts can touch upon almost every aspect of your company. Contracts are crucial to the success of any business arrangement.

Here are some ways that good contract management can affect your business and your bottom line:

  • Improves the process for generating, negotiating, signing, and renewing contracts
  • Increases revenue (and reduces expenses) because you can streamline contract creation and implementation processes
  • Creates strong relationships with your partners and vendors because you monitor contract performance and quickly identify problem areas
  • Promotes long-term profitability because you can renew more contracts with the partners who provide the best business opportunities
  • Ensures your suppliers are cooperative and respond to your organization’s needs
  • Supports strategic decision making because you can easily see the areas for growth, the partners and vendors that provide the best opportunities, and your organization’s ability to commit to additional work
  • Converts your strategy, partnerships, practices, policies, and capabilities into specific terms and conditions for any contract, providing deep insight into your business
  • Through a contract manager, advises C-suite stakeholders and executives on the effectiveness of the contract in implementing the organization’s goals
  • Supports commercial management because it ensures that you meet all your legal commitments once you’ve entered into a contract
  • Helps you assess, monitor, and mitigate financial, legal, and procurement risks
  • Creates standard processes for routine contracts and business, freeing time to address new business prospects and unique or infrequent processes or implementations

Contract Management Powers the Sales Cycle

Optimized contract management — the ability to tap the data in your contracts — benefits your sales cycle and is a growth area for all businesses. You can shorten this cycle from sales lead to contract to revenue, as well as reduce your customer acquisition costs, when you have up-to-date data and templates. Here are some ways contract management improves your sales cycle:  

  • Contract data helps you create quotes based on previous contracts.
  • Contract data cuts down on the negotiation process when initial quotes reflect the customer’s needs and previous business dealings.
  • Templates provide quality contracts that require less review from legal.
  • Effective contract implementation increases the likelihood of return business because customers are satisfied.

What Are the Stages of Contract Management?

Contract management and administration cover all stages of a contract, from creation and implementation to analysis, in a way that helps your organization improve its performance, boost sales, and increase revenue. It supports the complete customer and sales cycle, as well as the contract life cycle.

Contract Management Process Map

Contract Management Process Map

This contract management process map walks you through the 10 steps of the management process. Use it to identify the key inputs, deliverables, and outputs for each step in the contract management process.

Contract Management Stage 1: Request

Favorable discussions or quotes with a potential business partner or vendor trigger the request for a legal contract. In this pre-award phase, focus on the reasons for the contract and whether both sides can fulfill the terms.

At this stage, make sure that senior management supports the request and the partnership or agreement. Doing this will keep you from running into roadblocks later in the process or killing the project because it didn’t align with management’s goals and strategy.

Here’s a list of tasks you should complete in the first stage of contract preparation:

  • Identify the needs of the partner or vendor.
  • Understand the background of the contract and the business relationship.
  • Establish the goals of the proposed project, deal, or transaction.
  • Identify and set expectations.
  • Identify, define, and outline the terms to mitigate risk.
  • Specify the actions both parties need to take in order to fulfill the agreement.
  • Identify the key documents and contacts that will support the contract. (Typically, this information is accessible through an online, searchable library by way of an automated process.)

The inputs at this stage are the goals of the project, the information about the activities that support the contract, and the critical dates. The output is the initial documentation that saves the information and provides an early audit trail.

Contract Management Stage 2: Generate

To create an initial draft of the contract, research the purpose of the project and be clear about its goals. You may need to gather documents during the quote process or early sales cycle to ensure you have the context you need to generate the contract. Contracts typically change during negotiations, so both parties need to be flexible with the draft. Here are best practices for the draft:

  • The draft should be based on the contract request information.
  • The draft should include all related documents needed to fulfill the contract, such as clauses, terms, and conditions.
  • The draft should use clear and specific wording to avoid ambiguity or misunderstanding.

Templates with approved language from legal will speed up this stage and help you avoid bottlenecks that can occur when legal has to get involved in drafting every contract. Many automated contract management systems contain a searchable database of approved templates, clauses, and other legal documents.

Contract Management Stage 3: Negotiate

Negotiations should begin with trust and transparency to ensure that both parties have the best possible agreement. In many cases, negotiators use playbooks that break down the contract’s terms, fallback positions, clauses, issue lists, and questions that both parties need to answer during negotiations. Here are the steps in the negotiation stage:

  • Circulate the draft among internal stakeholders to ensure you’ve addressed all questions and issues.
  • Circulate the draft among the partner or vendor’s main contacts to gather feedback and identify points of discussion.
  • Review feedback on the draft, comparing versions and identifying the discrepancies that require negotiation.
  • Negotiate the terms and conditions, determining what is acceptable to both parties.
  • Circulate suggested revisions until both parties reach a final agreement on the terms and conditions.
  • Document every change to the contract. (You can shrink the review time of these changes by using tracking features in software.)
  • Finalize the changes, usually through a term sheet or letter of understanding (LOU) to make sure everyone approves of the terms and conditions before signing the final contract.
  • Identify the people who have the authority to formally approve and sign the final contract, as well as other signing details.

When you’re done, you will have a final contract or agreement document that is ready for formal approval.

Contract Management Stage 4: Approve

Once everyone has agreed to the terms of the contract, you can get final approvals. Depending on the contract’s size and scope, you may need to include your legal department, key executives and other internal management, external stakeholders, and the customer. The input is the contract document; the output is the final contract approval.

You may encounter another bottleneck when seeking management approval. To avoid that potential obstacle, make sure you’ve identified who needs to review the contract, and have policies and procedures to confirm the approval process.

Whether you use a manual workflow for approvals or an automated system that routes the contract and sends alerts, you must still oversee the process, so the contract can be completed and you can close the transaction. You can use parallel approvals (gathered by various departments at the same time) or serial approvals (sign-offs that happen in a consecutive workflow) to keep the process moving forward.

In this detail-driven phase of the process, approval tasks and checklists help you prepare for the transaction’s closing. Keep records of all the pre-closing, meeting, memoranda, and approval workflows. This documentation also helps you later, during your compliance and audit trails.

Contract Management Stage 5: Execute

To finalize the deal, all parties need to sign the approved contract. The contract goes into effect with those signatures. At this point, everyone should understand how the contract will work. You can simplify the signature process with e-signatures, especially if you are working with parties in different time zones or on different continents. Next, give copies of the signed agreement to all parties and store them in filing cabinets or in an online server or document library (where you can search for and manage them).

Contract Management Stage 6: Capture

Not only the source of truth for everyone involved in the project, each contract also contains a storehouse of data that you can use to grow your business. Gather all the signed contracts and supporting closing documents in a central system, so you can search, track, and retrieve the data. By organizing your documents this way, you can reap the following benefits:

  • It’s easy to access for record management, contract visibility, quality assurance and awareness, and complex situations.
  • It tags them with relevant keywords for easy search results and document retrieval.
  • It structures them for machine-readable or robotic discovery of data, which may include optical character recognition (OCR) conversion of PDFs or JPEGs into text documents that you can search using machine learning or artificial intelligence (AI).
  • It stores them securely to protect against theft or cyber attack.

Contract Management Stage 7: Comply

Once everyone has signed the contract, all parties need to adhere to the agreement’s terms and conditions. Failure to meet any performance measures, payment, or reporting can put you in breach of contract and may result in liabilities or contract termination. If you don’t comply with regulations, you can face severe penalties and even damage your organization’s brand.

Throughout the contract life cycle, you need to ensure you are following the contract’s aims and sections (also known as obligation management or commitment management ), and be on the lookout for any signs of noncompliance, including quality issues. One way to track and enforce compliance is by ensuring that a records management system is safely storing, accessing, and updating all your critical documents.

Contract Management Stage 8: Report and Audit

Reports and audits help you monitor the progress of a contract and alert you to potential problems and compliance issues. The contract should spell out the scope of any report or audit, but this can be tricky to monitor if the contract itself is stuck in a filing cabinet or desk drawer. With digital files and cloud storage in a searchable database or contract repository, it can be easier for you to know what you need to track and when you need to deliver the information.

Once you’ve established the best way to quickly and efficiently find the information, consider using an audit or report checklist that includes these details:

  • Payment, billing, and invoicing
  • Project expenses and spending
  • Project milestones and deliverables
  • Quality testing
  • Customer service
  • Systems and documentation used for audit trails

Reports and audits can reveal deficiencies or conditions that put the contract at risk, and you can put strategies in place to eliminate, mitigate, or transfer any potential risk.

Contract Management Stage 9: Review and Amend

Use the information in your reports to review your progress and identify whether you need to make changes to the contract. Establish a plan and time frame to review the performance of the contract. Revisions, changes, and amendments are common in the contract life cycle. Here is a list of typical changes:

  • Cost or price
  • Scope of work
  • Deliverables
  • Schedule or timeline
  • Overlooked items

A contract manager uses their skills in change management and document management to identify these areas, manage the relationship between the parties, and capture the details of the changes to which both parties agree. Some problem areas may be too severe to solve with a contract amendment. In those cases, contract termination may be the best solution for poor vendor performance or other issues.

Contract Management Stage 10: Renew

At the end of the agreement, you have the opportunity to consider extending the business relationship and renewing the contract. Make sure you’ve set alerts before the contract expires, so you can consider your option to let the contract lapse and end the relationship, renew the agreement, or renegotiate and create a new contract. You can rely on the performance reports to identify the best business — and revenue — opportunities, which feed back into the sales cycle.

Contract Management Maturity

The information in your contracts can help you grow your business. With better insight into the terms and performance of your contracts, you can lower your risk outcomes, improve your sales and renewal performance, and optimize your contract portfolio. The contract management maturity model (CMMM) provides a framework to help you move from a tactical business operation to a strategic approach that enhances your organization’s goals and revenue.

Here are the five stages of the CMMM. As your organization moves from an ad hoc to an optimized approach, you will identify more opportunities for business growth and strategic alignment between your contracts and your company’s long-term goals.

  • Ad Hoc: Organizations in this stage have some established processes, but the processes are not followed company-wide. These organizations lack a formal documentation system, and managers are not held accountable to comply with contract management policies and procedures.
  • Basic: These organizations have basic standards and processes, but these processes are required only for complicated, critical, or high-value contracts. They are not used on all contracts.
  • Structured: At this level, organizations have company-wide contract management standards and processes with formal documentation. With a library of standard contracts, managers tailor individual contracts rather than starting from scratch with each new contract. In addition, senior management offers direction and guidance.
  • Integrated: At this level, the contract management process is fully integrated with other business functions, such as financial management and systems engineering. The contract team includes end-user customers, and management uses metrics to make decisions about contracts and evaluate parts of the contract management process.
  • Optimized: At the highest level of maturity, organizations use performance data to evaluate the efficiency, effectiveness, and quality of the contract management process. These organizations also take a continuous improvement approach to the process, applying lessons learned and best practices with new and renewed contracts.

Uses of Contract Management

The process of managing contracts covers almost every industry, government agency, commercial business, academic institution, and more. All kinds of businesses, from public agencies to private companies, rely on a range of contracts that require contract management. Here are some examples of agreements that require contract management:

  • Employment letters
  • Purchase contracts and orders
  • Sales contracts and invoices
  • Utility contracts  
  • Construction projects
  • Highly regulated or technical goods or services
  • Intellectual property
  • International trade  
  • Distributors
  • Freelancers
  • Partnership agreements
  • Contracting
  • Sales and finance

Contract Management in Procurement

Procurement relies on contracts to buy the supplies and services your business needs. Sound contract management improves your procurement cycle and management. Here are the most common types of procurement contracts:

  • Cost-Reimbursable or Cost-Plus Contracts: When you haven’t fully defined the scope of work, use this agreement to pay the vendor or service provider for expenses related to developing the goods or services.
  • Fixed-Price Contracts: This is an agreement to provide goods or services at a set price and delivery schedule.
  • Time and Materials Contracts: This is a contract you use on smaller projects with high uncertainty. It includes an agreement to pay an hourly rate for work, plus the cost of resources or materials and a percentage of the total cost.

Contract management helps you identify and define your purchasing strategy, as well as manage the relationships with your vendors and service providers. Here is a list of some of the benefits of contract management in procurement:

  • Establish detailed master agreements with each vendor.
  • Ensure the vendor fulfills the agreement.
  • Monitor performance and quality.
  • Track related agreements to ensure you receive the best value for supplies and service.
  • Manage the vendor relationship to establish both long-term supply chains that are mutually constructive and a seamless acceptance of services and supplies.
  • Centralize procurement documents within the general contract portfolio.
  • Improve risk management by monitoring for delivery delays, late payments, or insufficient inventory.

Contract Management in Construction

Construction contracts typically govern goods or services that are part of the built or physical assets, such as infrastructure; structural, electrical, or mechanical systems in buildings; the transportation fleet; or the plant machinery. Contract management covers three phases:

  • Pre-Contract: Prepare tender documents, seek tenders, and conduct contract negotiations.
  • Contract Execution: Prepare the final contract documents for execution.
  • Post-Award: Measure performance against the terms and conditions of the contract, ensuring policy and regulatory compliance and timely payment.

Here are the most common types of construction contracts:

  • Cost Plus: This refers to payment of the actual costs or expenses that construction activity generates, plus a pre-negotiated amount that covers the contractor’s profit or overhead, such as a fixed percentage or fee, or a guaranteed maximum price or bonus.
  • Lump Sum or Fixed Price: This is a contract with a fixed-price total for all construction work, which can include incentives for early completion.
  • Time and Materials: This establishes an hourly or daily rate for work, plus additional expenses that could come up during construction.
  • Unit Pricing: This is a predetermined price for specific materials or quantities that you set during the bidding process to avoid a cost increase during the construction process.

Contract Management for Nonprofits

Nonprofits have to balance regulatory requirements or mandates from the granting organization with the needs of those who benefit from the mission and work of the nonprofit. Granting organizations and others who fund the work of nonprofits require precise contract management of spending and deliverables.

Much of the work of grant management relies on compliance with the terms of any grant or contract award. Nonprofits risk losing funding if they struggle to comply with the terms of the grant or are not transparent about the management of the contract. Here are some best practices for nonprofit contract management:

  • Ensure that the work covered by the contract aligns with your organization’s mission and strategic goals.
  • Update your policies, procedures, and systems to ensure compliance with the requirements that the funder set out in the contract.
  • Dedicate sufficient resources to write reports, attend meetings, and provide close oversight of activities covered by the contract.

Contract Management in Government

Government contracts follow a typical path: The agency (or customer) identifies a need; organizations submit proposals; the agency selects a proposal; and the contract is executed. Government contracts also have considerations that are not typical in private-sector contract management:

  • Federal contracts are governed by the Federal Acquisition Regulation (FAR) System , which guides recognition of needs, acquisition planning, contract generation and approval, and contract administration.
  • Federal agencies must comply with strict contract evaluation guidelines, spending requirements, and contract management.
  • State and local governments must follow certain federal or state laws, but may not be required to adhere to FAR regulations.
  • Government contracts often include a large oversight team of procurement staff, advisers, consultants, engineers, operations managers, and others.
  • Federal agencies use past performance evaluation (PPE) , a report that summarizes how an organization fulfilled previous contracts, as a reference when awarding new contracts.

What Are the Challenges in Contract Management?

Contract management is a complex function that is central to the success of every organization. Because it includes so many aspects of your business, contract management faces an array of challenges:

  • Lack of Coordination and Communication: Misunderstanding and conflicts can arise when you don’t have clear lines of responsibility and authority. Strong contract managers ensure consistent communication with internal and external stakeholders, as well as a defined process for feedback and approval at each stage of the contract life cycle.
  • Legal Is the “Department of No”: In-house counsel assists with most contract preparations and can even create, manage, and maintain contracts in the organization. Without a smooth process for viewing and vetting contracts, the work can progress slowly, resulting in other departments — especially sales — seeing legal as the obstacle to moving forward with contracts, sales, and strategic initiatives. Develop a checklist of the actions you need to smoothly generate, vet, approve, modify, and document any contract.
  • Time-Consuming Process: It takes time to generate, review, approve, implement, and renew contracts. Look for ways you can standardize and streamline the process, including maintaining a library of contract templates and boilerplate, communication tools that gather feedback and approvals in a timely fashion, reporting tools that automatically gather information about deliverables and track timelines, and searchable document archives that allow you to see the outcome of any contract at a glance. These methods help you avoid the bottlenecks that can form when creating and approving contracts.
  • Impact on the Bottom Line: Contracts are all about your business and its profitability. It’s essential, therefore, that you clearly spell out all the details. When a contract is phrased poorly, you may miss a technicality that could cost your organization thousands of dollars.

Best Practices for Contract Management

Contracts are the lifeblood of your organization, governing your internal and external relationships, as well as ensuring that your business benefits from every agreement and achieves optimal financial returns. Use these best practices to get the most from every contract and improve your contract management.

Specify a Workflow Process and Develop Standards

One person in your organization should be responsible for contract management. This will save your entire staff from scrambling to identify who has the data you need and the approvals you want. At the same time, train key staff members in the process, so they know how to do the following: gather needs and requirements; use the best templates to draft approved contract language; follow guidelines for negotiating; and oversee contract management.

Not sure where to start? Take a look at your existing procedures and see who holds key information. This can help you plan, design, and implement a mature contract management system. Involve other stakeholders and senior management to identify what’s working, where bottlenecks exist, and what steps to take to improve communication. Here are some details to consider as you establish your contract standards, documentation needs, and schedules:

  • Contract Management and Reporting: These include contract schedules, audits, reports for deliverables, and fiscal accountability.
  • Contract Renewal: Consider the standards that guide your decisions about whether to renew or terminate the agreement at the end of the contract.
  • Contract Requirements and Review: These include standard templates that form the basis for the contract, specific outcomes and deliverables accepted and documented by all parties, and the approval and signature process.
  • Procedure Requirements: These include the internal policies and procedures you need to manage the contract and avoid bottlenecks, the reporting guidelines to monitor quality and cost, and any conflict resolution strategies.

When you’re done, you should have a contract management process to ensure that everyone handles contracts in the same way and that every department knows what role it plays in that process.

Contract Management Template

Contract Management Reporting Template

A contract management reporting template helps you organize and track each contract for your organization. With this template, you can create a separate document for each contract you manage, complete with a project description, key dates, and deliverables, plus the information you need to ensure the contract stays on track or to create alerts if your project is falling behind.

‌ Download Contract Management ReportingTemplate - Excel

Elevate Project Management to Ensure You Meet Deliverables

Contract management can rely on project management principles to enhance a robust and complete system once you have a full understanding of every step in the contract process. Consider how you can accomplish these tasks:

  • Manage Service Delivery: Vendors should deliver goods and services in the quality and quantity that you’ve stipulated in the contract and on the schedule to which all parties have agreed.
  • Manage Relationships: Communication between your organization and the vendor or service provider should be frequent, fair, and transparent to avoid misunderstandings and keep the door open for future contracts.
  • Manage the Contract: Day-to-day contract administration and oversight ensures that all parties are meeting the terms and conditions, as well as identify and mitigate potential financial and regulatory risks.
  • Conduct Assessments: Reports and audits can help you identify gaps between the written contract and the actual implementation, as well as ensure that you follow your organization’s contracting process.
  • Protect the Contract’s Value: Look for issues that could affect your revenue or margin, including unrecorded liabilities, underreported revenue, or overpayments. Make sure the value of the contract to your business doesn’t deteriorate during the contract life cycle.
  • Manage Change: Most contracts require adjustments or amendments during the deployment of deliverables. Your organization needs to effectively document, communicate, and handle all changes.
  • Seek Improvements: Once you complete the contract, evaluate what worked, how you can improve your contracting process, and how you can enhance your relationship with the vendor or service provider.

Establish Metrics to Measure Your Effectiveness

Data drives decisions concerning your success in contract management and performance. You can’t know how well your process works without having clear goals and establishing key performance indicators (KPIs). While every contract may be different, you can use certain metrics with your vendors to evaluate contract management.

  • Contract Life Cycle Length: Measure the number of contracts in each life cycle stage (pre-award, award, and post-award) and the duration of contracts in each stage. Look for bottlenecks in your process, and identify vendors that may create delays. Determine an acceptable range for a particular internal department or external vendor, as well as for specific products or deliverables.
  • Contract Value: Measure your overall contract value (average revenue per contract) on a monthly, quarterly, and yearly basis. You can compare the annual value of recurring contracts with that of new contracts, as well as with the lost revenue from contracts that you terminate or don’t renew.
  • Contract Trends: Measure the number of contracts by type, partner, customer, program, or geographic region. Look for growth opportunities or established business that you can build upon.
  • Contract Compliance: Measure how well you and your vendors meet the terms and conditions of your contracts. Missing milestones can be costly in relation to revenue or other regulatory guidelines, while missed payments or overpayments can cost you money. Also, look at the number of changes needed for your contracts and identify any amendments that are issued on a regular basis. You may identify needs in your contract templates or pinpoint issues with specific external vendors or internal departments.
  • Quality: In manufacturing, quality is easy to measure. A product meets the specifications or acceptable number of defects per number of parts. In service contracts, you can measure quality by the number and type of customer complaints and by response times. Look for any exceptions that you make on a consistent basis, and note whether you are exposed to additional risk.
  • Cost Effectiveness: This starts with the contract’s price terms but extends to the length of the contract cycle, performance metrics, and the quality of the goods or services.
  • Contract Execution: Measure how effectively and accurately you gather signatures, and make sure they are the right signatures. Contracts without the appropriate authorization can carry unforeseen consequences, especially if the products or services are highly regulated or expose you to increased costs, added risk, or even lawsuits.
  • Renewal Rates: The percentage of contracts that you don’t renew can help you identify revenue loss from existing clients. That means your sales department has to work harder to gain new clients, and it can increase your customer acquisition costs. Determine the acceptable range of renewal rates for your organization.

Key Performance Indicator Dashboard

KPI Business Dashboard Template

A KPI dashboard can help you track everything from your total number of contracts to trends per contract or partner/vendor. Once you know what you want to monitor, choose the dashboard that will provide the right data presentation to guide your business. Use this template to create custom KPI dashboards for your business.

‌ Download Key Performance Indicator Dashboard - Excel

Optimize Contract Value

Mature contract management establishes a steady feedback loop between your contract portfolio and your business performance. Your goal is to maximize financial and operational performance.

Examine your current processes (the group of activities or tasks you need to manage a contract) and your workflows (how the tasks are organized and who completes them). Identify and eliminate tasks, steps, and obstacles that waste your organization’s time, money, and resources. Analyze your contracts for benefits to your organization, whether they are of financial or strategic value. Using your KPIs, you can also identify vendor performance.

Continually Communicate

Contracts touch many departments in your organization. Ensure that teams don’t work in silos, and collaborate smoothly and transparently. A shared system or document library provides real-time access to information, and it streamlines communication and decision making. Contract management is easier when all stakeholders can quickly make decisions.

Integrate Legal Considerations

If your legal department or general counsel is considered the “department of no,” you’ve already identified one roadblock to successful contract management. Start the contract management process with up-to-date templates that account for all the legal aspects. Use these templates to create consistent contracts that help you avoid financial and compliance risks. By doing so, you free up legal counsel to focus on the critical, unique aspects of a contract, rather than the standard boilerplate that’s required to execute and monitor the contract terms and conditions.

Document the role of counsel in your contract management. In some organizations, lawyers work behind the scenes to draft, finalize, and monitor contracts. In others, lawyers are active negotiators. Use their expertise to establish legal playbooks that you can use during negotiations.

The Benefits of Software and Automating the Contract Life Cycle

Aberdeen Group, an international market intelligence company, found that organizations with contract management solutions perform at a higher level than their peers. The best-in-class companies have more than 75 percent of their contracts in a searchable repository, enabling them to gain greater insight into contract performance, mitigate risk, and improve their contract renewal rates.

With manual contract management, you run the risk of bottlenecks in the sales or approval cycle that could result in missed renewal opportunities and lost business revenue. Manual contract management exposes you to manual errors and inefficient filing systems that bog down your organization.

That’s why many organizations accept, trust, and rely on cloud-based applications and software. These systems can feature central document repositories that function like a digital version of a filing cabinet. Here are a list of features:

  • Organized and searchable contracts that give you greater visibility into the data and details of your contract portfolio
  • Self-service portals
  • Electronic signatures (e-signatures) and approvals
  • Pre-approved contract templates, which are especially useful for larger contracts that require coordination among multiple departments and parties
  • Standard legal playbooks
  • In-depth tracking and reporting tools
  • Software storage that securely protects contracts and processes

The more robust systems bridge the gap between your company’s customer relationship management (CRM) and enterprise resource planning (ERP) systems. Automated systems allow you to accomplish a range of tasks, including the following:

  • Streamline contract management processes, giving management, stakeholders, and general counsel greater confidence.
  • Create contracts quickly and accurately, shortening your sales cycle, improving contract flexibility, and decreasing contract disputes.
  • Increase revenue by collecting payment sooner and improving contract renewal rates.
  • Track compliance quickly and improve legal, vendor, and supplier compliance.
  • Cut your administrative costs and free up staff time.
  • Decrease revenue leakage.
  • Mitigate risk quickly.
  • Grow sales due to more time for lead generation and managing customer relationships.
  • Improve your KPI analysis and spend optimization, identifying business opportunities and cutting costs.

Steps to Automate the Contract Management Process

You can take steps to move to an automated process, which combines your collection of paper and digital files to create an online repository that helps you grow your business and optimize your contract administration process.

Put your files in one location with these steps:

  • Conduct an audit of contract locations. Identify where your files are currently located and who manages, stores, and accesses them.
  • Identify the digital systems used to store and monitor contracts.
  • Gather supporting contract management tools, such as contract templates and checklists.
  • Determine how you want to structure a single system that creates a central repository of contracts, templates, amendments, and vendor information. Include key terms that you will use to search the data.

Improve your contract workflow with these steps:

  • Identify which departments or areas need to review contracts.
  • Map the order for contract approval.
  • Determine how you will add contract language and version control.
  • Build a library of legal playbook talking points and tools.
  • Evaluate which processes can be automated to free up manual stakeholder and legal reviews.

Establish your contract execution process for all stakeholders with these steps:

  • Gain process efficiencies with alerts and notifications.
  • Implement an e-signature process.
  • Determine how you will distribute final contracts to all parties.

Monitor contract performance with these steps:

  • Build and use role-based dashboards for real-time performance data.
  • Use compliance tracking to identify and mitigate pain points.
  • Create alerts that monitor milestones, invoicing, and renewal deadlines.

The Future of Contract Management

In an increasingly global economy, the companies that survive and thrive will be those that know how to gather and leverage data to drive new revenue. The best in breed are already reimagining how they manage the customer life cycle; they are beginning to see contract management as a discipline that extracts contract information to guide their sales and revenue and impact the bottom line. Contract managers will work closely with sales, as an integrated unit, to oversee contracts in all the organization’s trading relationships.

Contract management will shift from managing compliance to improving governance. It will be the “framework within which the integrity of a transaction is decided,” as defined by Nobel laureate Oliver Williamson . There are four components to an evolving collaborative governance framework for contract management:

  • Relationship Management: Gone are the days of merely managing approvals and monitoring compliance. Contract management is about the relationship between the key departments in your organization and your vendors and service providers.
  • Joint Performance and Transformation Management: This process tracks partnerships and strategically envisions how these relationships can help you re-imagine your business.
  • Exit Management: Use governance to control your organization’s risk and revenue. It encourages ethical, positive, and proactive approaches.
  • Compliance with Evolving Regulations and Special Concerns: Once contract management matures in your organization, the process can broaden its view. Managers will be forward-thinking, looking at the future of an increasingly complex regulatory environment and the unique needs of existing partners, as well as the demands of potential customers.

Improve Contract Management with Real-Time Work Management in Smartsheet

Empower your people to go above and beyond with a flexible platform designed to match the needs of your team — and adapt as those needs change. 

The Smartsheet platform makes it easy to plan, capture, manage, and report on work from anywhere, helping your team be more effective and get more done. Report on key metrics and get real-time visibility into work as it happens with roll-up reports, dashboards, and automated workflows built to keep your team connected and informed. 

When teams have clarity into the work getting done, there’s no telling how much more they can accomplish in the same amount of time.  Try Smartsheet for free, today.

Discover why over 90% of Fortune 100 companies trust Smartsheet to get work done.

Change Orders: What They Are and How to Manage Them

Women working together on change orders

Change orders are ubiquitous in any industry that handles long-term projects. Unfortunately, they’re often difficult to manage. A change order requires getting all the information from the original contract, project specifications and plans, and looping in your clients and teams. All of this information is stored in separate systems that don’t communicate naturally. 

This makes creating a robust and thorough change order complicated. Navigating these isolated processes takes time and leaves room for human error. It also leaves clients and your own team in the dark, as there’s no transparency in the contract creation process. ‌

Improving the efficiency of your change order creation process is critical to the success of your entire company. You can save your legal team time , prevent mistakes, and give your clients and teams better insight into how contracts are built. But why are change orders so important?

  • What is a change order?

A change order is a written amendment to an existing contract after the effective date that alters the work, the contract sum, or the contract time. While contracts are intended to be the final word for projects, sometimes things need to change. If your customers discover new needs and requirements after a contract is signed, they can request a change order.   

For example, suppose a client realizes they need an additional feature from the project you are completing for them. They can request a change order from you to add that feature. Your legal and design teams then produce a first-draft of a change order that includes the new feature, the adjusted price, and any company fees for altering the contract after the effective date. 

From there, you and your client can negotiate minor details of the change order contract. Once you’re both satisfied, you can sign the form. At that point, it’s considered a legally binding extension of the original contract.

  • The purpose of a change order

A change order contract allows your legal team and your clients to come to an agreement on any alterations to the contract terms without needing to scrap the original. A change order acts as legal protection for your company and your clients.

 It acts as an extension of the contract and ensures that all parties understand their new duties and expectations. It codifies the specific changes the client wants, and provides legal notice of any adjustments to the price and timeline that the client should expect.

  • When do I need a change order?

There are two primary situations in which you may need a change order. First, you should use a change order if your client requests alterations to a project after the contract’s effective date. Second, these orders are crucial if you discover new information (such as previously-undisclosed limitations or new legislation) that adjusts a project’s scope after getting started. 

Both situations require you to deviate from your original contract. E‌ven if the client requested it, deviation from a contract without a paper trail can leave you open to legal consequences.

For example, your client could refuse to pay for the additional services, or file a lawsuit for deviating from the written contract. Without a change order, it would be difficult to pursue legal action or defend your company. A verbal agreement simply isn’t robust enough. 

Even if your client appears to be acting in good faith, change orders are still valuable. The process of writing the change order m‌akes sure that you’re both on the same page.

  • Parts of a change order

Change orders typically consist of three parts: the project information, the changes to the contract, and the change in cost and time for performance. 

  • Project information includes the project name and the owner’s and contractor’s information. It also covers information about the original contract, including the effective date and the work to be provided. Finally, it should include the change order’s effective date and number (i.e., the second change order is labeled 02).
  • ‌ Contract changes include every change the client has requested. In this section, it’s best to be detailed. Cover additions, subtractions, and the cost of each change. The best practice is to include specs, drawings, and any other attachments that clarify the scope of the change order. 
  • ‌ Cost and time changes: Finally, the cost and time changes summarize how the contract changes will affect the contract price and timeline. 

One field where change orders are common is construction. The American Institute of Architects provides a standardized construction change order form that allows you to input all of this information. The AIA change order form is effective for occasional change orders, but if you’re in a different industry that requires you to perform frequent contract alterations, you’ll likely need a more robust solution.

  • Limitations of change orders

Change orders have two significant limitations. First, suppose the scope of the change order is wider than the original order requirements. In that case, a change order contract may not be enough to satisfy the clients’ new needs.

As an example of a change order, say a construction project expands to require plumbing that was not previously necessary. In that case, you may need to hire a subcontractor, but change order doesn’t cover new subcontractors. Instead, the original contract may need to be renegotiated to permit subcontracting.

Second, some localities have statutes that limit the amount by which a project’s scope can be increased through change orders. If a project’s scope increases too dramatically in these districts, it’s better to write and agree upon an entirely new contract.

  • Creating a change order

There are many reasons why you may need to create a change order. Common causes of change orders include:

  • ‌The customer requesting adjustments to the project, such as new features or changes to existing elements
  • ‌Correcting an inaccurate estimate of the project’s work or scope, such as an overestimate of time to completion
  • ‌Adjusting the contract in response to setbacks like new regulatory requirements or unexpected delays
  • ‌Altering the project budget to ensure deliverables can be completed

‌It doesn’t have to be complicated. While change orders may seem overwhelming at first, they can be broken down into more approachable steps.

Starting the creation process

Creating a change order requires attention to fine details and regular communication. These five steps can help you create a change order that’s both thorough and effective.

Read the original contract, plans, and specifications. Make sure you know the specific contract clauses and specifications that will be affected by the change order. 

Communicate with both the client and the teams who will be held to the change order. Ensure you understand your client’s requests in detail and work with your design team to collect new estimates.

Document all requested changes. Collect all information regarding the changes in one place to ensure that you aren’t missing important details.

Consolidate information into the change order template. Once you’re confident you have all the details, input the data into the change order form. If you notice anything missing, follow up with the relevant party. 

Refine with the client and creative teams. Present the change order to your team to ensure it’s feasible, then negotiate any changes the client may want.

  • Managing change orders

As you can see, change orders require a significant amount of information and discussion. When all of that data is stored in diverse and disconnected locations, it can be challenging to keep track of it all. Writing a detailed change agreement in that environment is time-consuming if you want to do it well. 

In the meantime, your client and team can discover new details that necessitate further changes, causing the process to take even longer.

Streamlining the change order process

If you want to streamline your change order process, you need insight into the creation and execution of these orders. A fully transparent contract creation and execution process lets you monitor documents through their lifecycle. You can avoid mistakes, spot bottlenecks, and return change orders to clients in less time.

You can achieve this with a contract lifecycle management solution. A contract management platform acts as your company’s single source of truth. It’s an all-in-one solution, allowing you to create, fill, and sign documents in one location. There’s never a risk of missing documents that would affect your contracts. The process is entirely transparent, so there’s no doubt about how your contracts are put together. ‌

Ironclad product features that help

If you’re considering implementing contract lifecycle management in your firm, Ironclad can help. Ironclad’s contract lifecycle management platform can help you design change order templates , collaborate with your team on changes , and maximize the use of your contract data —all within a single platform. 

Using digital contract management for change orders and statements of work makes it easy to fill and update forms. All your information is easily accessible, from the original contract to the supplementary appendices. There’s no back-and-forth necessary—Individual team members can fill in elements of the form when they’re available. With Ironclad , the entire process can be managed and completed in a fraction of the time. 

  • Simplify change orders for good

Change orders are vital documents, allowing you to keep contract changes legally secure. However, they can be time-consuming to produce. That’s particularly true if all of your contract information and specs are stored in different places. 

Using Ironclad’s digital contract management software can help you stay on top of the process. By consolidating your data and streamlining contract creation, you can produce robust change orders quickly. Contact us today to learn how digital contracting can streamline your firm’s change order workflow for good.

Ironclad is not a law firm, and this post does not constitute or contain legal advice. To evaluate the accuracy, sufficiency, or reliability of the ideas and guidance reflected here, or the applicability of these materials to your business, you should consult with a licensed attorney. Use of and access to any of the resources contained within Ironclad’s site do not create an attorney-client relationship between the user and Ironclad.

Table of contents

Want more content like this? Sign up for our monthly newsletter.

Related topics

  • Contracts and clauses

You might also like:

Navigating Options Contracts: Strategies for Success

Navigating Options Contracts: Strategies for Success

The Dynamic Nature of Executory Contracts

The Dynamic Nature of Executory Contracts

Consulting Agreements from Negotiation to Execution

Consulting Agreements from Negotiation to Execution

contract change management

6 Ways to Improve Contract Change Management with a CLM Platform

Contract change management can be taxing for enterprise businesses. But it doesn’t have to be. Explore the requisites and strategies for effective contract change management.

Sreyesh Sarma

Contract change management

For enterprise businesses, thousands of contracts dictate their business operations. These contracts range from supplier and service-level contracts to employment agreements and partnership pacts. But, as any enterprise managing thousands of contracts can attest, change is a constant companion in the business world. In the ever-changing business landscape, contracts must adapt to changing circumstances. Managing these changes in thousands of contracts is no small feat. Whether due to market fluctuations, shifting business priorities, or evolving regulations, contract change management is pivotal in ensuring contracts remain relevant.    

Contract change management is critical to successful business operations, particularly for enterprises that manage thousands of contracts. Change management can be a particularly complex endeavor since it involves multiple stakeholders, differing terms, and diverse requirements.  

In this blog, we will delve into the world of contract change management, examining the rationale behind changes, the process, the challenges, and the steps involved to improve this essential aspect of contract management.  

But first… 

What is contract change management?  

Contract change management is the systematic process of handling modifications and amendments to existing contracts. These changes can range from simple revisions to complex overhauls, all aimed at ensuring that contracts remain up-to-date and relevant in a dynamic business environment. This process can be daunting for large enterprises managing thousands of contracts and could lead to potential legal risks and financial loss.  

Here are some of the pain points in managing contract changes for an enterprise business.  

Complexity: Managing a huge volume of contracts, ranging from Procurement, Sales, employee, and partnership agreements, can be incredibly complex. Keeping track of what needs to be modified, when, and why is a serious challenge.  

Risk Management: Failing to properly manage contract changes can lead to compliance issues, disputes, and even legal action.  

Inefficiency: Manual contract change management processes are often inefficient, requiring significant human intervention and leading to slower contract TAT and bottlenecks in workflow. 

Communication Challenges: Coordinating with various stakeholders, including legal teams, vendors, and internal departments, can be a communication nightmare. 

Auditability: Maintaining a comprehensive history of contract changes is difficult in manual systems, which can lead to audit and compliance issues.  

An efficient contract change management strategy can mitigate risks, avoid legal disputes, and ensure that contractual relationships remain effective and beneficial for all parties involved.  

The rationale behind changes in a contract 

Contracts are not static documents; they are living agreements that require adaptability. Various factors can trigger changes in a contract, including:  

Market Conditions: Economic shifts, changes in supply and demand, and fluctuations in commodity prices can necessitate alterations to the terms and pricing of contracts. 

Regulatory Changes: New laws and regulations can significantly impact contractual obligations, requiring adjustments to ensure compliance. 

Business Strategy: Companies evolve, and as they do, their priorities and strategies change. This can lead to modifications in contractual terms to align with new goals. 

Force Majeure Events: Unexpected events like natural disasters, pandemics, or geopolitical crises may disrupt contract performance, necessitating adjustments to mitigate risks and losses. 

Performance Issues: If one party fails to meet its obligations under the contract, modifications might be necessary to address the shortcomings and ensure continued performance.  

Steps involved in contract change management 

Contract change management is a systematic process that involves several critical steps to handle modifications and amendments to existing contracts. These steps help ensure that contracts remain relevant and compliant with changing business needs and external factors.   

The contract change management process can be broken down into the following: 

Identification of Change: The need for a contract change is identified. This could be initiated by one of the parties or due to external factors such as regulatory changes, evolving project requirements, force majeure, etc.  

Evaluation: The proposed change is evaluated to ensure it aligns with business goals, and legal requirements and is feasible. 

Negotiation: Parties negotiate to discuss and agree on the modifications. This can involve changes in scope, pricing, or other terms. 

Approval: Once the revised contract is drafted, the change needs approval from all relevant stakeholders. 

Documentation: After reaching a consensus, the changes are documented and incorporated into the contract as an amendment or addendum.  

Execution: The amended contract is executed, and the new terms come into effect. 

Monitoring: Continuous monitoring ensures that all parties adhere to the updated contract terms.  

6 Ways to Improve Contract Change Management 

Enterprises can leverage an end-to-end contract lifecycle management platform to address these challenges and streamline contract change management. Here are 6 ways a robust CLM platform can help:  

Centralized Repository: A centralized contract repository can help businesses store, track, and manage all contracts in one place. The repository is easily accessible and offers version control features to ensure you work on the latest document.  

Automate Notifications: Leverage contract management software to automate notifications and alerts for key contract milestones. This includes reminders for contract renewal dates, review periods, and pending changes. Automation reduces the risk of missed deadlines and ensures that contract changes are addressed promptly. 

Standardized Templates: Contract lifecycle management platforms offer standardized contract templates that can be easily modified for specific situations, reducing the time required for contract change negotiations.  

Access Control: Assign role-based access to contract data, ensuring only authorized personnel can make and approve changes. 

Audit Trails: Maintain detailed audit trails within your contract management platform. These trails record all changes made to contracts, including who made the change, when it was made, and why it was made. Audit trails provide transparency and accountability, which can be essential for compliance and dispute resolution.  

Real-time Collaboration: Collaborative tools enable real-time collaboration among internal and external stakeholders, even if they are geographically dispersed. This ensures that all parties can work on contract changes simultaneously, reducing delays and speeding up the process.  

4 Do’s in Contract Change Management

Document All Changes: When changes are made to a contract, it is imperative to document them in writing. This documentation should include the nature of the change, the reasons behind it, and the approvals from all relevant parties. The importance of documentation cannot be overstated. According to a survey by WCC, 49% of organizations reported that inadequate documentation was a leading cause of contract disputes. 

Maintain a Clear Audit Trail: An audit trail is a chronological record of all modifications made to a contract, including who made the changes and when. This is vital for transparency and accountability. Maintaining a clear audit trail not only helps in case of disputes but also provides insights into the history of the contract's modifications. 

A study by Deloitte found that 35% of organizations identified a lack of visibility into contract changes as a significant challenge.

Regularly Review and Revise: Regular reviews allow organizations to proactively address issues, align contracts with changing business strategies, and avoid potential disputes arising from outdated terms and conditions. 

A study by the Aberdeen Group showed that best-in-class organizations review and revise contracts 40% more frequently than their peers.   

Leverage Technology: Modern businesses implement cutting-edge technologies to streamline contract change management processes. An end-to-end CLM can reduce the time and effort required for changes and provide analytics on historical changes, making it easier to spot trends and potential issues.

4 Don'ts in Contract Change Management

Don't Make Verbal Agreements: Relying on verbal agreements for contract changes is risky. Verbal agreements are difficult to prove and often lead to misunderstandings or disputes. The WCC survey also revealed that 70% of organizations experienced contract disputes due to oral changes. Written documentation is critical to preventing conflicts.

Don't Overlook Contractual Procedures: Every contract typically includes specific change procedures. These procedures may include requirements for written notices, approvals, or formal amendments. Failing to follow the contractual procedures outlined in the original agreement can invalidate the contract change. 58% of respondents in a study by McKinsey & Company cited not following proper procedures as a significant cause of contract disputes.

Don't Delay Communication: Prompt and effective communication is vital during the contract change process. Failing to communicate changes promptly can lead to misunderstandings, delays, and disputes. According to the Deloitte study, 62% of organizations experienced issues due to a lack of timely communication during contract changes.

Don't Ignore Risk Assessment: Making changes a contract can introduce new risks. Conduct a thorough risk assessment when implementing contract changes. Assess the potential risks associated with the modifications and ensure they are mitigated appropriately. A study by WCC found that 37% of organizations identified increased risks due to contract changes.

Manage contract changes with a CLM 

By understanding the rationale behind changes and implementing an efficient process, businesses can ensure their contracts remain aligned with their evolving needs and the dynamic business environment. The pain points of manual contract change management can be alleviated through automation, centralized repositories, and standardized workflows. By doing so, enterprises can remain agile and responsive to their dynamic challenges.   

Discover how SimpliContract’s end-to-end contract lifecycle management platform can improve your contract change management framework.

Logo

  • Contract Management

Supplier Management

Savings Management

  • Data & Security

FAQ’s

oboloo Articles

Contract change in procurement: adapting agreements effectively, introduction to contract change in procurement.

Welcome to our blog post on contract change in procurement! In the fast-paced world of business, flexibility and adaptability are crucial. This holds especially true when it comes to procurement contracts . Contracts are the backbone of any successful business relationship, but what happens when circumstances change? How do you ensure that your agreements remain relevant and effective? That’s where contract change management comes into play.

In this article, we will explore the importance of adapting agreements in procurement and delve into common reasons for contract changes. We’ll discuss different types of contract changes and provide strategies for effectively implementing them. Additionally, we’ll address the challenges that come with adapting contracts and offer solutions to overcome them. We’ll share some best practices for successful contract change management.

So whether you’re a seasoned procurement professional or just starting out in the field, read on to discover how you can navigate the complexities of contract changes and ensure smooth operations within your organization! Let’s dive right in!

The Importance of Adapting Agreements in Procurement

Procurement is an essential function for any organization, and contracts play a crucial role in governing these procurement activities . However, the business landscape is constantly evolving, which may require adjustments to existing agreements. This highlights the importance of adapting agreements in procurement to ensure continued success and efficiency.

One key reason why adapting agreements is important is that it allows organizations to respond effectively to changes in market conditions or business requirements. For example, if there are shifts in supplier availability or pricing structures, contract changes can help address these challenges and optimize procurement processes .

Another factor that underscores the importance of adapting agreements is the need for flexibility. In today’s fast-paced world, rigid contracts can hinder an organization’s ability to seize new opportunities or navigate unforeseen circumstances. By proactively making necessary adjustments, businesses can maintain agility and stay ahead of their competitors.

Additionally, adapting agreements ensures compliance with legal and regulatory frameworks. Laws and regulations affecting procurement practices are not static; they evolve over time. Therefore, updating contracts accordingly helps mitigate risks associated with non-compliance while promoting ethical sourcing practices.

Moreover, effective contract adaptation promotes stronger relationships between buyers and suppliers. By collaborating on mutually beneficial modifications when needed, both parties can align their goals more closely and enhance trust within the partnership.

Recognizing the importance of adapting agreements in procurement enables organizations to remain adaptable amidst changing dynamics while fostering compliance with legal requirements. It also facilitates better collaboration between stakeholders involved in the contractual process – ultimately contributing to overall operational excellence in procurement management .

Common Reasons for Contract Changes

Contracts in procurement undergo changes for various reasons, as the dynamics of business environments are constantly evolving. One common reason is a shift in project requirements. As projects progress, new needs and priorities may emerge that require adjustments to the original contract terms. These changes can range from modifications to delivery timelines or budgetary constraints.

Another factor that often leads to contract changes is external market conditions. Economic fluctuations, industry regulations, or even unforeseen events such as natural disasters can significantly impact procurement agreements. In response to these circumstances, contracts may need to be revised to ensure compliance with new laws or adapt to changing market conditions.

Contract changes may also arise due to technological advancements. As technology continues to advance at a rapid pace, organizations need flexibility within their contracts to incorporate emerging technologies or adopt more efficient processes. This allows them to stay competitive and leverage innovation effectively.

Additionally, scope creep is another prevalent reason for contract modifications in procurement. Scope creep occurs when there are uncontrolled expansions of project deliverables beyond the initial agreement’s boundaries. It often arises due to incomplete requirements gathering or unclear expectations during the planning phase.

Moreover, unforeseen risks and uncertainties can necessitate alterations in contractual arrangements. For instance, if a supplier experiences financial instability or fails to meet performance benchmarks outlined in the agreement, amendments might be necessary.

In summary,

contract changes occur for a multitude of reasons such as shifts in project requirements, external market conditions, technological advancements, scope creep, and unforeseen risks. Ensuring effective management of these change requests requires careful planning and collaboration between all parties involved

Types of Contract Changes

When it comes to procurement, contract changes are inevitable. As business needs evolve and circumstances shift, contracts often require adjustments to ensure they remain effective and aligned with the objectives of both parties involved. Understanding the different types of contract changes can help procurement professionals navigate these modifications smoothly.

One common type of contract change is scope modification. This occurs when there is a need for additional deliverables or a change in project requirements. It may involve adding or removing certain tasks or adjusting timelines to accommodate new priorities.

Another type is budgetary modifications. Sometimes, unexpected costs arise during the course of a project, requiring adjustments to the financial terms outlined in the original agreement. This could involve increasing or decreasing funding allocations based on unforeseen circumstances.

Contract duration extensions are also common types of changes that occur in procurement. These extensions allow for more time to complete a project due to delays or other factors beyond control.

Additionally, contractual amendments might be necessary due to legal and regulatory changes impacting the initial agreement. Adapting contracts accordingly ensures compliance with updated laws and regulations governing specific industries or jurisdictions.

In some cases, parties may request performance-related modifications when they feel that certain aspects outlined in the contract need refinement or improvement for better results.

By understanding these various types of contract changes, procurement professionals can effectively address evolving needs and maintain productive relationships with their suppliers/vendors/partners throughout the lifecycle of an agreement.

Strategies for Effectively Implementing Contract Changes

Contract changes are a natural part of the procurement process , and it’s crucial to have effective strategies in place to ensure smooth implementation. Here are some key strategies for effectively implementing contract changes.

1. Clear Communication: Open and transparent communication is vital when it comes to contract changes. Ensure that all parties involved understand the reasons for the change, any potential impact on deliverables or timelines, and their respective roles in implementing the changes.

2. Document Everything: It’s essential to document every aspect of the contract change process , including discussions, decisions made, and any modifications to terms or conditions. This documentation will serve as a reference point if any disputes arise later on.

3. Assess Impacts: Before implementing a contract change, carefully assess its potential impacts on cost, schedule, quality standards, and other relevant factors. Evaluate whether additional resources or adjustments are necessary to successfully incorporate these changes into existing agreements.

4. Seek Legal Advice if Necessary: Depending on the complexity of the contract change and its legal implications, it may be wise to seek legal advice from experts specializing in procurement law or contracts management. They can provide guidance on navigating complex contractual issues while ensuring compliance with applicable regulations.

Train Staff: To effectively implement contract changes across an organization, proper training is paramount. Equip staff members who will be directly involved in executing these changes with adequate knowledge about new procedures or requirements resulting from alterations made within contracts

Challenges and Solutions in Adapting Contracts

When it comes to making changes to contracts in procurement, there are bound to be challenges along the way. The process of adapting agreements can be complex and time-consuming, requiring careful consideration and negotiation. One common challenge is resistance from stakeholders who may be reluctant to change established contractual terms. This can stem from concerns about added costs or potential disruptions to existing workflows.

Another challenge lies in managing the expectations of both parties involved in the contract. It’s crucial for all parties to have a clear understanding of the proposed changes and their implications. Miscommunication or misunderstandings can lead to conflicts that hinder progress.

Additionally, legal complexities can pose obstacles during contract adaptation. Ensuring compliance with regulatory requirements while modifying contractual terms requires expertise and attention to detail.

Fortunately, there are solutions available for overcoming these challenges. Open communication between all stakeholders is key – this includes regular meetings or consultations where concerns can be addressed proactively. Engaging legal experts early on helps identify potential hurdles and mitigates risks associated with changing contracts.

Implementing effective change management strategies also plays a vital role in facilitating smooth contract adaptations. By creating a comprehensive plan that outlines timelines, responsibilities, and milestones, organizations can navigate through the challenges more efficiently.

While adapting contracts poses its share of difficulties, proactive communication, expert guidance, and robust change management strategies enable organizations to successfully overcome these challenges during procurement processes.

Best Practices for Successful Contract Change Management

When it comes to managing contract changes in procurement, following best practices is crucial. Here are some key strategies to ensure successful contract change management:

1. Clear Communication: Effective communication is the foundation of successful contract change management. Ensure that all stakeholders are informed about the proposed changes and their impacts. Clearly communicate the reasons behind the changes and address any concerns or questions promptly.

2. Documentation: Maintain a comprehensive record of all contract changes, including written documentation detailing the modifications made, along with supporting evidence such as emails or meeting minutes. This will help track and manage any future disputes or disagreements.

3. Risk Assessment: Before implementing any contract change, conduct a thorough risk assessment to identify potential risks and develop mitigation strategies accordingly. Assess how the proposed changes may impact cost, quality, timelines, and other critical aspects of the project.

4. Flexibility: Contracts should be designed with flexibility in mind to accommodate unforeseen circumstances or changing business needs. Incorporate clauses that allow for amendments without compromising fairness and accountability.

5. Collaboration: Foster collaboration between procurement teams, vendors/suppliers, legal departments, and other relevant stakeholders throughout the contract change process . Encourage open dialogue to gather valuable insights from different perspectives.

Technology Adoption: Leverage technology solutions such as contract management software to streamline your contract change management processes efficiently.

Track revisions easily,distribute documents seamlessly,and automate approval workflows for faster turnaround time

By adhering to these best practices,you can enhance your organization’s ability to adapt contracts effectively,enabling smoother procurement operations even amidst evolving requirements

In today’s dynamic business environment, contract changes in procurement are inevitable. It is crucial for organizations to effectively adapt their agreements to stay competitive and maximize value. By recognizing the importance of contract change management and implementing strategies tailored to the specific needs of each situation, businesses can navigate the challenges associated with adapting contracts.

Successful contract change management requires clear communication, collaboration, and flexibility between all parties involved. It is essential to identify common reasons for contract changes such as scope modifications, price adjustments, or unforeseen circumstances. This understanding enables organizations to anticipate potential changes and proactively address them.

There are various types of contract changes that may occur throughout the procurement process: amendments or modifications, addendums or attachments, substitutions or replacements, terminations or cancellations. Each type requires careful consideration and documentation to ensure compliance and mitigate risks.

To effectively implement contract changes, organizations should develop a systematic approach that includes thorough analysis of impacts on cost, timeframes, resources, and other project variables. Collaboration between procurement teams and suppliers can help streamline the change process by aligning expectations and finding mutually beneficial solutions.

While adapting agreements in procurement presents its fair share of challenges – such as resistance from stakeholders or legal complexities – there are solutions available. Open dialogue among all parties involved facilitates smoother transitions during the change implementation phase. Seeking expert advice from legal professionals specialized in contracts can also provide valuable insights into navigating complex contractual arrangements.

To achieve successful outcomes in managing contract changes within procurement processes:

1) Establish a robust change control process: Implement a clearly defined procedure that outlines how requests for modifications will be evaluated, approved/denied, and communicated. 2) Maintain accurate documentation: Ensure all alterations made to contracts are recorded accurately, including any supporting documents like emails, amendments, or addendums. 3) Foster transparent communication: Keep all relevant stakeholders informed about proposed changes early on while maintaining open channels for discussion. 4) Seek mutual agreement: Collaborate with suppliers and other parties involved to negotiate fair and mutually beneficial terms

Want to find out more about procurement?

Access more blogs, articles and FAQ's relating to procurement

Oboloo transparent

The smarter way to have full visibility & control of your suppliers

Contract Management 

Partnerships 

Charities/Non-Profits

Service Status

Release Notes

Feel free to contact us here. Our support team will get back to you as soon as possible

Sustainability

contract change management

  • change management , contract , contract change process , contract management

Improve contract performance with effective change management process

Improve contract performance with effective change management process

Track and manage contract change management processes effectively to improve contract performance and extract maximum value from agreements, while reducing the time and resources spent during the change process.

What to do when contracts do not meet expectations on value or quality? Many times, the renegotiation of contract terms, even for simple changes, can take time, resulting in lost revenue or delays. Additionally, keeping track of the discussions related to change management processes can be challenging when using tools such as email to retain discussions. Capturing and understanding the actual changes required in a contract may also be difficult, particularly when major updates are required.

Change management in contracts

Change management is the process of implementing adjustments to an active contract. Change can represent an opportunity to renegotiate elements, such as pricing or identify other improvements that can enhance contract performance or value. Implementing and managing changes to a contract and its scope is a common process that may be performed many times during its life cycle.

Sometimes changes are small or more complex, and the process of managing these is aided by maintaining records and discussions that express the nature of contract changes. This also ensures a clear and well-documented background for the rationale behind changes, as well as confirmed approval from internal or external stakeholders.

Change management is only possible through regular communication between all contracting parties, and it can be challenging to ensure that changes to a contract are universally understood and the scope of changes are clearly distinguishable for all concerned.

Benefits of effective contract change processes

Well executed contract change processes can reduce costs, risks and even contract complexity. Additionally, changes can improve contract schedules and obligations to the benefit of both parties. Effective change management processes can help sustain good relationships with customers or suppliers by providing quick, concise, and clear information about changes as early as possible in the process. This is likely to benefit any negotiation action taken during the change, helping to reduce the time and effort needed to modify a contract.

Cloudia Contract allows users to easily initiate and manage contract change processes so that they are completed in a timely manner, thus avoiding drawn-out renegotiation processes, while ensuring that changes are fully understood and recognised by all parties.

Improve contract performance with effective change management process

Why Cloudia Contract?

  • Access full editing capabilities to active contracts
  • Generate a clear summary of any and all changes made
  • Quickly and effectively edit contract elements, including individual clauses and attachments
  • Easily share information about changes to internal and external stakeholders to expedite the negotiation process

Want to improve your contract change management process? Contact us with the contact form below to get started.

You should also check out how to manage contract disputes effectively with digital contract management .

Contact us to build your strategic suite

Digital contract management makes it easier to locate and access contract data, digital contract management proved invaluable in resolving savings bank group’s data security questions, digital contract management – what are the benefits, turn data into insight, get the contract information you need, quickly and with minimal effort, manage contract disputes effectively with digital contract management, in times of crisis what makes a cpo great, exceptional situation providing the opportunity for developing procurement operations, digital procurement electrifies the energy sector, privacy overview.

Click here to return to previous view

contract change management

Source-to-Contract solutions

Procurement Planning Sourcing Contract Management Supplier Management Analytics

contract change management

Solutions for suppliers

Supplier Portal

  • Contact sales

Start free trial

How to Make a Change Management Plan (Templates Included)

ProjectManager

A change management plan is a critical part of any project plan can be the difference between project success and failure. Let’s break down how to create one so you can better manage project change, no matter where it shows up in your project life cycle.

What Is a Change Management Plan?

A change management plan is a process that implements a change or changes in a project or across an organization. You can think of a change management plan as a roadmap that shows all the steps you need to take from identifying the change to realizing it. This plan not only sets the course by which you can execute the change, but asks how it will impact the project or organization, how workflows will be affected and whether it will alter your relationship with your customers or teams.

Manage Change, Reap the Benefits

By using an effective change management plan you’re able to manage the process and thereby be more productive in its execution. It helps you control the budget, schedule , scope and resources. It even impacts your communication process. In fact, the change management plan is systemic, touching on all aspects of project management. When done correctly, it will minimize the impact to your project or organization.

contract change management

Get your free

Change Log Template

Use this free Change Log Template for Excel to manage your projects better.

Elements of a Change Management Plan

Define the following elements below to create an effective change management plan for your project.

  • Change Management Roles:  First, who is going to be doing what in your change management plan? Who has the authority to submit a change request, who reviews them and who authorizes them? You’ll need to define roles and responsibilities for effective change control
  • Change Control Board:  Staff your change control board with people who will receive the change requests and have the authority to approve or veto them.
  • Develop a Process: You need a process in order to effectively submit, evaluate, authorize and manage and control the change requests. Without a process, change management is unmanageable.
  • Change Request Form: You can’t have a process, however, if you don’t first create a change request form to capture the data. It’s important that the information you collect is consistent throughout the project.
  • Change Log: Basically, this is a place to collect, and then track all the change orders . Without a central location where changes can be identified, requests approved and assignments documented, there’s no way to know if there’s been any progress.
  • Use a Tool: A project planning software  can help you keep track of changes through every phase of the project until it’s finally resolved.

Project management software can help you execute your plan. ProjectManager has an award-winning Gantt chart that can be used to create your change management plan: organize tasks, link dependencies, set milestones and even filter for the critical path. The plan can be shared with your team, who can use our multiple project views to collaborate better. You won’t find an easier-to-use or more powerful change management software. Get started with ProjectManager today for free!

ProjectManager's Gantt chart

How to Make a Change Management Plan

Jennifer Bridges, PMP, breaks down how to create a change management plan in the following video. She explains how change is measured against the project baseline , which is the detailed description of the time, cost, scope and quality of the project that you have determined when planning. Therefore, a change management plan is going to take that baseline and ask how, what, when where, why and how to figure out change and how to manage it.

After you watch the video, be sure to try some of our free templates below to help you manage change and your project.

Pro-Tip: There are different types of change management, and the best way to get a holistic understanding of it is through the triple constraint. There are processes established to help with the change management process , and it’s crucial to know them. Also, keep in mind that change management procedures vary depending on the industry you’re in. For example, change order forms are used primarily in construction to change the scope of projects.

Take it Further: Sometimes, when tough changes happen in the midst of execution, technical debt can be accrued. Learn all about it and how to minimize it.

Our free change log template for Excel is part of any thorough change management plan.  It is the next step once a change has been proposed and authorized by the project manager. This free template has space to write the change request type, the date it was identified, a brief description, the priority and its status.

contract change management

More Change Management Plan Templates

Change management can be planned, executed and monitored best with project management software , but if you’re not using that tool then you can still get by with templates. ProjectManager has dozens of free templates on its site, which touch on every aspect of a project, including the change management plan. Below are three free templates to get you started.

Change Request Form Template

Before a change can be approved, stakeholders or project team members should use a change request form to suggest changing the project scope or project plan. If their request is feasible, it can be approved and turned into a change order.

Change Order Form Template

Our free change order form template for Excel is just the tool to streamline the change approval process. It helps you understand the change, from the opportunity it offers and the reason for the change to how long it’ll take, who requested it and who will authorize or deny it.

Action Plan Template

Get that change management plan executed properly with our free action plan template for Excel. This is where you can organize all the tasks that are necessary to implement the change. You can note which action steps occur during which phase in the project and then assign them to your team. They’ll see the start date and due date as well as the planned hours you expect for the duration of each task. There’s even room for resources and costs related to the work.

Go Beyond Change Management Templates with ProjectManager

ProjectManager is cloud-based work and project management software that connects hybrid teams to help implement change across an organization or project. Real-time data makes it collaborative to the core and multiple project views mean anyone in any department, no matter how, when or where they work can use it the way they want, whether in a task list, Gantt or kanban board.

You’ve seen how a Gantt chart can organize the change management plan but when that plan is assigned to teams that maybe work in a more agile environment, then they need a different tool. Kanban boards visualize workflow and workflows can be customized to automate task approvals, for example. Managers have control and transparency, while team members can manage their backlog and collaborate when planning sprints.

A screenshot of the Kanban board project view

Track Change on the Dashboard

Monitoring change is how you make sure your actual progress is aligned with your change management plan. Our real-time dashboard gets live data and crunches the numbers to display metrics on time, cost and more in easy-to-read graphs and charts. It’s a status report whenever you need one so you can catch issues and resolve them before they cause problems.

ProjectManager’s dashboard view, which shows six key metrics on a project

ProjectManager is award-winning work and project management software that connects hybrid teams for greater productivity. Manage change without impacting your schedule or budget. Get started with ProjectManager for free today!

Click here to browse ProjectManager's free templates

Deliver your projects on time and under budget

Start planning your projects.

  • Project management |
  • What is a change control process and ho ...

What is a change control process and how do you use it?

Team Asana contributor image

A change control process is a way for project managers to submit requests to stakeholders for review, that are then approved or denied. It’s an important process to help manage large projects with multiple moving parts.

The change control process is essential for large initiatives where many teammates work cross-departmentally. Let’s dive into the process and tangible examples to help you implement a change control procedure of your own.  

What does change control process mean?

Change control is a process used to manage change requests for projects and big initiatives. It’s part of a change management plan, which defines the roles for managing change within a team or company. While there are many parts to a change process, the easiest way to think about it is that it involves creating a change log where you’ll track project change requests. 

In most cases, any stakeholder will be able to request a change. A request could be as small as a slight edit to the project schedule or as large as a new deliverable. It’s important to keep in mind that not all requests will be approved, as it’s up to key stakeholders to approve or deny change requests. 

Since the change control process has many moving parts and differs from company to company, it’s useful to implement tools that can help the lifecycle process flow smoothly. Tools such as workflow management software can help you manage work and communication in one place. 

Change control vs. change management

Confused by the difference between change control and change management? We don't blame you. There are many differences between change control and a change management plan . Change control is just one of the many pieces of a change management strategy. 

Change control: A change control process is important for any organization to have, and can help the flow of information when it comes to project changes. A successful process should define success metrics, organize your workflow, enable teams to communicate, and set your team up for future success. 

Change management: A change management plan consists of coordinating budget, schedule, communication, and resources. So while a change control process consists of a formal document that outlines a request for change and the impact of the change, change management is the overarching plan.

As you can see, a change control process is just one small part of a larger change management plan. So while related, the two terms are different.

What are the benefits of a change control process?

Implementing a change control process can help organize your team with the support of organization software and efficiency around project deliverables and due dates. It’s also crucial when considering the consequences of change that isn’t managed effectively.  

A change management process can help you execute a resource management plan or other work management goals. Here are some additional benefits of implementing a change control process. 

Increased productivity  

A change control process will eliminate confusion around project deliverables and allow the focus to be on executing rather than collecting information. This results in increased productivity and efficiency, especially with the help of productivity software .

Without a process in place, productivity can suffer due to time spent on work about work. With limited bandwidth available for the most important work, over one-quarter (26%) of deadlines are missed each week.

Effective communication

Properly documenting change can help alleviate communication issues. When goals and objectives are clearly defined, team communication can flourish. Keep in mind, a change control process won’t fix all communication issues. It may be helpful to also incorporate work management software to keep communication about projects in one place.  

A change control process can then also be shared with executive stakeholders in order to easily provide context for change requests.  

Better teamwork and collaboration

Not only is effective communication a benefit in its own right, but it can also help improve collaboration. With clear communication on project changes, it’s easier to collaborate and work together. 

For example, when changes are clearly communicated the first time around, stakeholders have more time to focus on creativity and teamwork. Without effective communication, stakeholders are forced to spend time piecing information together instead of working creatively with team members. 

Want to enhance collaboration even further? Pair your change control process with task management software to set your team up for success. 

The five steps of a change control process

Similar to the five project management phases , there are five key steps when it comes to creating a change control process. Though some processes differ slightly, they all contain a few key elements. From initiation to implementation, each one of these basic steps helps change requests move efficiently through the pipeline and prevent unnecessary changes. 

The five steps of a change control process

Some prefer to view the procedure in a change control process flow, which can be easier to visualize. No matter how you choose to look at it, the outcome will be a finalized decision on whether a change request is approved or denied.  

Let’s dive into the five steps that make an effective change control process and what’s included in each.

1. Change request initiation

In the initiation phase of the change control process, a change is requested. There are numerous reasons why you might request a change. For example, a creative deliverable is taking longer than anticipated. A request would then be made to adjust the deliverable due date. While a request may be more likely to come from a stakeholder or project lead, a proposed change can be requested by anyone. 

A team member who wishes to make a request should submit one via a change request form. As the project manager, you should store the change log in a place that’s easy to find and everyone has access to. 

Once the request form has been filled out, you will update the change log with a name, brief description, and any other details you see fit, such as the date and name of the requester. The log is a record of all project changes, which can be beneficial for managing multiple projects that span many months. 

Here’s an example of various fields you might include in a change request form.

Project name

Request description

Requested by

Change owner

Impact of change

The fields you include will depend on how thorough you want your change log to be and the type of changes you come across.

2. Change request assessment

Once the request has been filled out and the initial form has been submitted and approved, the request will then be assessed. This is different from the initial form submission since the assessment is when the actual change will be evaluated. 

The assessment phase isn’t necessarily where a decision is made, but rather, reviewed for basic information. The information will likely be assessed by a project or department lead, who will review details such as the resources needed, the impact of the request, and who the request should be passed on to. 

If the change request passes the initial assessment, it will then be passed on to the analysis phase where an actual decision will be made. 

3. Change request analysis

The change impact analysis phase is where there will be a final decision on whether the request is approved or denied by the appropriate project lead. While you may also give input on the decision, it’s a good idea to get official approval from a leader as well. In some cases, there may even be a change control board that is in control of any change approvals. 

An approved change request will require signoff, and from there, be communicated to the team and continue through the rest of the five-phase process. It should be documented on the change log and anywhere else project communication lives to ensure all project stakeholders understand the shifts needed. 

If the change request is denied, it should also be documented on the change log. While communicating a denied request to the team isn’t necessary, it could be helpful in order to prevent confusion. 

4. Change request implementation

If the change request is approved, the process will move on to the implementation phase. This is where you and the project stakeholders will work to make the project change.  

Implementing a change will look different depending on what stage the project is in, but it usually consists of updating project timelines and deliverables, as well as informing the project team. Then the actual work can begin. It’s a good idea to evaluate the project scope to ensure any changes to the timeline won’t have a huge impact on projected goals. 

It’s best to disseminate the request’s information in a shared workspace and the change log to ensure productivity isn’t lost by trying to look for new information. You may even want to send out a revised business case to cover all of your bases. 

5. Change request closure

Once the request has been documented, disseminated, and implemented, the request is ready to be closed. While some teams don’t have a formal closure plan in place, it’s helpful to have one in order to store information in a place that all team members can reference in the future. 

In the closing phase, any documentation, change logs, and communication should be stored in a shared space that can be accessed later on. You should also store the initial change form and any revised project plans you created along the way. 

Once documents are in the appropriate place, you can close out any open tasks and work on successfully completing your project. Some project leads also host a post-mortem meeting before officially closing the project. 

Change control process example

Now that you understand the five steps of a change control process, it’s time to put them into action. We’ve put together an example to give you a tangible place to start.   

Before putting your own plan together, it’s important to evaluate your current processes and tools to ensure they’re right for your team. You may even want to create a business case or project plan to present to company stakeholders. 

The entries you include in your change log may differ depending on the types of changes you frequently come across and how complicated the projects are. While complicated projects that span months may run into more change requests, smaller one-off projects may not need as detailed of a change log. 

Here’s an example change log to give you an idea of what to include and how to format your own. This change control example includes:

Priority status

Progress status

Change type

This simple format is a great starting point for a change log, but you may choose to add additional fields depending on the complexity of your project. 

Change control process example

To create your own change log, you can create a custom template or view our project templates gallery . 

When to use a change control process

It’s a good idea to note when to use a change control management plan so you’re prepared when the time comes. There are many different kinds of change that you might come across, depending on any new initiatives and the tools in place.

Common changes might include requests to extend timelines, reorganization of information, or a change in the deliverables. Here are some additional instances where you may want to use a change control process. 

Over scope: You may want to consider using this process when a project is going over scope, also known as scope creep . 

Project inconsistencies: If you notice inconsistencies during a project, requesting a change can help you avoid having to rework deliverables later. 

Steep goals: In some cases, OKRs may be out of reach and it’s a good idea to flag those issues before the project is complete.

New tools: If there are new processes or tools in place, change may be inevitable while you work out new issues during your first few projects. 

Request your way to change

While changes are inevitable, the good news is a change doesn’t have to derail your next project. By implementing a change control process, you can ensure the project stays on track and communication is clear and effective. This will bolster productivity and lessen confusion about your project deliverables . 

In the event that you do run into change, it’s reassuring to know that you have the right processes in place to handle the situation. When you have a change management plan ready to go, you can mitigate the negative impacts associated with a shift in strategy and continue to focus on delivering impact.

Related resources

contract change management

What is stakeholder analysis and why is it important?

contract change management

7 causes of content calendar chaos—and how to solve them

contract change management

What is a product launch? A guide from planning to execution

contract change management

What is resource management? A guide to getting started

404 Not found

Featured Content

" "

Cost Management

" "

Artificial Intelligence

Meet BCG X banner

BCG X Product Library

" "

Change Management

Change is essential but far from easy. Roughly half of all change management projects—and 75% of large-scale transformations—fail to meet their objectives. BCG’s change management consulting services help organizations beat these daunting odds.

Change management efforts allow companies to reinvent themselves as new opportunities and challenges arise, leading to greater participation in—and earnest adoption of—critical transformation initiatives. This adaptability allows businesses to hone their competitive edge.

BCG's change management consultants unlock transformation’s true potential, using approaches and tools that incorporate artificial intelligence, behavioral science, deep learning, and data analytics. The underlying principles come from our Smart Simplicity concept, which teaches that understanding people’s behaviors, along with the context in which they work, reduces complexity and improves performance.

The success of our change management consulting approach can be seen in the track record of the more than 3,000 companies in our Transformation Check benchmark:

CM-BTN-Graphic-211122.png

How BCG Uses Change Management to Help Clients Gain an Edge

BCG works with clients to address their most pressing business transformation challenges. We help:

  • Align and activate leaders around strategic initiatives
  • Craft and execute persona-driven communications and engagement plans
  • Prioritize and manage complex portfolios of change initiatives
  • Establish and advise the office of the Chief Transformation Officer (CTO)
  • Transform organizational performance and culture
  • Manage transformation-related people changes and cost reductions
  • Create program-management best practices for complex business strategies

Our Change Management Approach

BCG’s network of change management consultants helps clients through our proven three-journey approach:

Leader Journey

  • Behavioral science tactics like our Nudges at Scale approach
  • Education and targeted coaching on a transformation leader’s role
  • Leadership tools and playbooks to help manage the change, align culture, foster the right type of behaviors, and mobilize the extended leadership team
  • Forums, so leaders understand what matters most and how to activate necessary behaviors across the organization
  • Executive workshops, so leaders can envision the case for change and set the strategic agenda

People Journey

  • Stakeholder identification and prioritization
  • Communication and engagement strategies
  • Data collection to track and measure employee readiness and impact
  • Implementation of organization and role changes

Program Journey

  • Alignment on program setup, structure, workstreams, and initiatives
  • Integration of the team with the Office of CTO’s office
  • Identification of financial and KPI accountability, including determining the baseline and validation approaches
  • Creation of a value-delivery process, including ways of working and capability building for a program’s transformation office

" "

Copy Shareable Link

" "

Change Management and Behavioral Science

Our approach to change is driven by data and informed by the latest research in neuroscience, behavioral economics, and psychology. BCG experts in these fields have established the Behavioral Science Lab, which develops and applies a suite of propriety data-driven tools and evidence-based approaches to help clients achieve meaningful and lasting change. At the Behavioral Science Lab, we:

  • Study and diagnose human behavior through a scientific lens, using proprietary diagnostic tools—one tool , for example, measures employees’ "change energy," that is, their emotions, confidence, and capacity to take on new work throughout a change initiative. 
  • Design behavioral solutions, including nudges, to change behavior and achieve desired outcomes. 
  • Build behavioral science capabilities and “nudge units” within organizations to institutionalize sustainable change.

Our Change Management Enablers

Our change management strategy experts deploy several foundational tools to support our change management approach, including:

Change Management Academy

Change Academy

This key enablement solution helps organizations adopt the skills and ways of working needed to carry out their change management strategies. The program offers end-to-end trainings as well as learning modules on specific change management topics and tools. Offerings are tailored to a client’s needs and are delivered through hands-on exercises, led by BCG’s change management consultants or through on-demand learning and modular sprints.

Transformation LAUNCH

Transformation Launch

Our Transformation LAUNCH solution kicks off the critical first four weeks of a change effort and gets the office of the CTO off to a good start. We’ve found that Transformation LAUNCH correlates to an 80% higher likelihood that a change program will succeed. Our change management consultants combine their expertise with learnings from other organizations’ transformation experience and analytics from our Transformation Check database to customize kick-off activities in four areas.

Meet Our Change Management Consulting Leaders

Kristy Ellmer

Managing Director & Partner

fetherston-julia-tcm9-156657.jpg

Managing Director & Senior Partner

San Francisco - Bay Area

Headshot of BCG expert Jens Jahn Partner & Director

Reinhard Messenböck

The critical role of change management in large scale transformation.

The Key CTO Competencies to Steer and Manage a Transformation

Michael Lutz

The key cto competencies to steer and manage a transformation, bcg’s client work in change management, ensuring the right change.

By embracing strong change management principles, an insurer put itself on a growth trajectory—and positioned itself ahead of its predicted timeline to achieve $500 million in cost savings.

Powering a Cost-Focused Culture

An energy company embedded new behaviors and mindsets for sustainable gains—and identified more than a thousand cost-saving initiatives.

Becoming a Public Sector Powerhouse

A government agency partnered with BCG to design and implement a new service delivery model—which delivered a 15% increase in productivity.

The Prescription for Shareholder Value

A pharma company streamlined operations and improved its return for investors—while delivering efficiency savings totaling $1.6 billion.

Our Latest Insights on Change Management

" "

People Make the Difference in Green Transformations

Companies committed to becoming sustainable find that it can be a struggle to marshal their organization and people behind that goal.

AI Is Revolutionizing How Companies Manage Transformations | rectangle

AI Is Revolutionizing How Companies Manage Transformations

Analyzing massive data sets in real time, generating unbiased insights, enabling prompt course correction: an AI-based approach is powering up—and radically transforming—initiative management.

What Works—and What Doesn’t—in Transformation - rectangle

What Works—and What Doesn’t—in Transformation

Change is harder to implement than ever, but a new analysis highlights why some companies still manage to outperform the competition.

Why Leaders Can’t Let Up in Transformations | Rectangle

Why Leaders Can’t Let Up in Transformations

The business environment just keeps getting tougher, but transformation is still an imperative. A new survey confirms that five measures can make a big difference in results.

Explore Related Services

Business transformation.

" "

People Strategy

" "

Change Your Trajectory: Monthly insights on business transformation.

  • Latest Headlines

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com.

https://deloitte.wsj.com/riskandcompliance/why-it-pays-to-improve-contract-lifecycle-management-f9068706

Why It Pays to Improve Contract Lifecycle Management

Improving the handling of contracts from initial request through long-term management can help save organizations money and lower risk while improving regulatory compliance.

contract change management

Depending on its size, a financial services organization could have thousands of contracts with third-party providers at any one time, spanning large ERP systems right down to the florist that supplies the lobby arrangements.

Some of these contracts are highly bespoke, requiring the expertise of experienced internal or outside counsel. But many of them, perhaps even the majority, can follow a standardized and more streamlined and consistent approach utilizing cost-favorable contract negotiators. This approach has shown that an organization can handle relatively common contracts resulting in significant cost savings, faster preparation and closing speeds, as well as better business insight.

contract change management

“Think of it as creating a superhighway,” says Joe Mendel, a principal with Deloitte Transactions and Business Analytics LLP. “Many contracts can stay on the superhighway for the whole distance, while some may need to take an exit ramp.”

In Deloitte’s experience, improving the contract management process can potentially save some organizations upwards of 60%. But time and cost savings are not the only benefits. It could also help financial services firms stay on top of their compliance obligations.

“You could spend hundreds of hours negotiating a contract, and later realize you have no way to govern the risk, respond to regulatory requirements, and enforce the terms you worked so hard to achieve,” Mendel adds.

Mendel shares some of the steps an organization can take to better manage the contract life cycle.

Mendel: It is important to create a playbook, which then becomes the cornerstone for the entire contracting process, highlighting roles, responsibilities, escalation protocols, and reporting, as well as negotiation tactics. These playbooks are tailored to an organization’s goals, dynamic enough to evolve with marketplace conditions, and comprehensive in scope. To be effective, the scope should cover the complete life cycle of contracts—from initial contract request through archiving and managing contract obligations. Leaders can then begin work on optimizing the end-to-end contracting process. By that, I mean set improvement goals that streamline processes while adding value, such as reducing contracting cycle time and cost per contract, freeing up attorneys to work on more strategic matters, and using automation and intelligent data to develop insights about contract terms and obligations.

Leaders should also consider which contracts might be candidates for automation. Those are usually the low- and medium-complexity agreements that follow a blueprint and require less of a high-touch approach.

Where might there be risks if contracts are not managed appropriately?

The risk could be in the process itself—for example who is part of the escalation path and how do documents get funneled. There’s also risk in the negotiation, for example the need to include a certain type of indemnity or fourth-party data rights. It’s important to understand what the various risks are, safeguard against negotiating in the wrong direction, document the risk, create a process to mitigate that risk, and put the proper governance in place.

There’s also risk stemming from lack of insight. There are some organizations that don’t know how many contracts they’ve created with a certain third party, or how many contracts they have that include or exclude a certain provision, or which contracts might be affected should, as an example, data privacy laws change.

Some less complex contracts, such as nondisclosure agreements, can still take time to negotiate and therefore can become expensive to process when using outside counsel. Such contracts may hold little value and little risk, so a bespoke approach is unnecessary. Effectively enhancing the process improves transparency and visibility. It also helps organizations keep track of the latest versions of contracts where amendments have been made and drives better value, more efficiency, accountability, and lower fees.

An enhanced contract lifecycle management system can also help organizations stay on top of regulatory issues. For example, within financial services, an organization should maintain a complete inventory of their third-party relationships and conduct periodic risk assessments of each relationship. An inability to provide evidence of completion may result in a penalty associated with noncompliance.

How might an organization approach each step in the contract lifecycle to work toward that goal of a distributed and repeatable process?

This issue highlights the importance of the playbook. Start with looking at the format in which a request comes in, and whether and how that request is documented. Then, consider which service level agreements (SLAs) are being measured against, how long it took to respond to the request, and how long it took to get a draft out. Ascertain whether a third-party contract template is used and—if so—whether the same template is used for the same types of services. In a similar vein, look at whether a standard playbook is used for negotiation, so that if two different people from different departments within the same organization are negotiating with the same third party, they’re asking for the same concessions and terms.

It’s important to ensure there’s a process in place if it’s necessary to escalate the contract, perhaps to someone in cybersecurity or data management, and there ought to be a documentation process that accompanies that. Then consider how the agreement is executed, whether through electronic signature or wet ink, and how it’s stored. Ideally, the repository where it’s stored would be searchable, either through structured data fields or unstructured text searching. Lastly, consider how the obligations or provisions of the agreements would be maintained.

Altogether, this creates a system that is measurable and, therefore, can be managed and improved.

What kind of measurable outcomes might an organization expect?

First and foremost, there could be significant cost savings on legal fees if an organization is reducing its reliance on outside counsel for less complicated agreements. Second, there could be an improvement in quality, for example, consistency, turnaround time, and SLAs.

There are also cost savings associated with keeping track of the various agreements. For example, if an organization has contracts with three similar service providers, by knowing what’s in each of the agreements, it could leverage favorable terms from one in its negotiations with the others. There could also be a discount available—for example, a lower rate with one of the three providers—for a given service or quantity. Keeping track of that provision can ensure the provider honors it, thereby potentially saving the organization money.

Quality improvements could also help address potential strategic risks. For instance, it’s important for an organization to know where it stands from a contract perspective if things were to go south. Consider potential ramifications if a service provider went out of business? If they had a terrible event and the organization no longer wanted to do business with that provider, what would be its right to terminate the agreement? If that right has been amended over the years of the relationship, is there documentation for all those amendments? These are all reasons an organization would want a robust contracting process in place.

How might automation and intelligent data processing provide strategic insights?

Advanced technologies including AI, natural language processing, and automation can help provide real-time visibility into where contracts are in the process and what the agreements contain, particularly changed or new elements. That type of real-time information management and reporting can drive business intelligence such as increased visibility into negotiation patterns. Intelligent contract triage and delegation to alternative resources can help redistribute low-risk tasks so in-house legal teams can focus on more complex, high-touch issues. Ongoing performance obligation management can provide insights to the compliance and internal audit teams for evaluation. Further, intelligent tools and reporting systems can help increase satisfaction among business stakeholders by, for example, demonstrating that customer KPIs are being achieved—thereby emphasizing the growing strategic value of the legal and contracting functions. We are starting to see generative AI play a role in this as well.  For example, an organization can compare the terms of any signed contract or new draft agreement against a negotiations playbook in seconds.

This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor.

Deloitte shall not be responsible for any loss sustained by any person who relies on this publication.

About Deloitte

Copyright © 2024 Deloitte Development LLC. All rights reserved.

What to read next...

Legal Counsel: Navigating the Risks of AI

Legal Counsel: Navigating the Risks of AI

SMBC Group in the Americas’ CFO on Making Finance a Conduit for Strategy

SMBC Group in the Americas’ CFO on Making Finance a Conduit for Strategy

Why It Pays to Improve Contract Lifecycle Management

Guardian CLO: Take Setbacks as Feedback, Not Failure

SEARCH DELOITTE ARTICLES

EXECUTIVE PERSPECTIVES

Copyright © 2024 Dow Jones & Company, Inc. All Rights Reserved

Gatekeeper's COVID-19 Resource Centre

This website stores cookies on your computer. These cookies are used to improve your website and to provide more personlised services to you, both on this website and through other media.

To find out more about the cookies we use see our Privacy Policy .

contract change management

  • Book a Demo
  • Gatekeeper for Legal Teams
  • Gatekeeper for Procurement Teams
  • Gatekeeper for Finance Teams
  • Gatekeeper for Vendor Management Teams
  • Gatekeeper for Operations Teams
  • Gatekeeper for IT Teams
  • Gatekeeper for Sales Teams

contract change management

  • Complete Guide to Contract Management (ebook)
  • Contract Management Template Bundle (Excel)
  • Contract Management RFP Templates (Excel)
  • 2023 Gartner® Magic Quadrant™ Report
  • An Introduction to Vendor Management (ebook)
  • Vendor Risk Management Checklist
  • Customer Knowledge Base How-to Guides for Using Gatekeeper
  • Request my demo

Search common contracting language and take a deeper dive to discover what each means

Contract Change Management

Contract Change Managemen t is the process agreed between the Parties to a Contract to formalise the requesting, development and implementation of a Variation to the Contract.

  • REQUEST MY DEMO

UKAS-ISO9001-Mark-cl-27_Mono

  • SPECIALISMS
  • Contract Lifecycle Management
  • Vendor Lifecycle Management
  • Contract Management Software
  • Vendor Management Software
  • Artificial Intelligence
  • OCR Search & Analysis
  • Enterprise Contract Management
  • USEFUL LINKS
  • What is VCLM?
  • How to manage vendors
  • How to review a contract
  • Complete Guide to CLM
  • How to build a Business Case
  • How to run an RFP
  • Vision & Values
  • Partner Program
  • Privacy Policy
  • Terms of Service
  • Legality of E-Signatures
  • Data Processing Agreement
  • Data Feed Terms

UKAS-ISO9001-Mark-cl-27_Mono

Copyright © 2015 - 2024. Gatekeeper™ is a registered trademark.

Request your free demo of Gatekeeper

Top rated clm software.

Capterra_5Star_Badge

Before Gatekeeper, our contracts were everywhere and nowhere. Anastasiia Sergeeva, Legal Operations Manager, BlaBlaCar
Gatekeeper is that friendly tap on the shoulder, to remind me what needs our attention. Donna Roccoforte, Paralegal, Hakkasan Group
Great System. Vetted over 25 other systems and Gatekeeper rose to the top. Randall S. Wood, Associate Corporate Counsel, Cricut

Book your Free Demo of Gatekeeper

Thank you for requesting your demo.

Next Step - Book a Call

Please book a convenient time for a quick call to discuss your requirements.

contract change management

Change management solution,

Zoho Contracts enables you to adapt quickly to changes in a business environment and within contracts using our intelligent, sleek, and comprehensive features.

Change management solution

Why change management is important for today's businesses

The current business landscape is in a constant state of flux due to evolving new technologies and highly uncertain geopolitical environments. The pandemic has further aggravated the situation as businesses around the globe are trying to grapple with unprecedented disruptions in supply chains caused by it. In addition, regulations are cropping up more often than ever across all industries. These factors have put the emphasis on effective change management at an all-time high. Given these circumstances, optimizing for flexibility with an effective change management strategy is the most critical investment any business can make.

It is not the strongest or the most intelligent who survive but those who can best manage change.

Keep up with regulatory changes using clause-based reports

Regulatory changes, or even an internal policy change, will demand alterations to some clause language that would affect multiple contracts in an organization. Traditional systems make the process of changing contracts with these clauses challenging. Using clause-based reports in Zoho Contracts means you can effectively assess the impact of these changes across all your business deals.

For example, if a regulatory change impacts the Liability for Damages clause, the Clause vs No. of contracts report will display the number of contracts that have that clause. The admin can click on the entry, and the report lists all the contracts having the Liability for Damages clause.

Faster and accurate change management using our smart letter templates

Since clauses are the building blocks of contracts in Zoho Contracts, the tool will be able to capture changes made to any part of the contract document. The contract owner can directly start editing the document during amendments, and Zoho Contracts will automatically generate an amendment letter based on the letter template, capturing all the changes. In this amendment letter, the Whereas clause captures the contract history with all the past amendments, renewals, and extensions in chronological order. The Now Therefore clause shows the changes made to the agreement in the current amendment.

Zoho Contracts ensures that the amendment letter goes through the approval, negotiation, and signature cycles before the amendment becomes active. This process will ensure that the internal stakeholders and the counterparty are aware of the changes made to the contract. The auto-generated letter templates and the workflow are also available for renewals, extension, and termination.

Never miss out on a renewal opportunity

Renewals are the lowest-hanging fruit from the standpoints of revenue expansion and strengthening business relationships. Fortunately, Zoho Contracts makes renewing and extending contracts effortless.

The in-app and email alerts in Zoho Contracts notify users of upcoming renewals so they don't miss out on any renewal opportunities.

In Zoho Contracts, the contract owner can renew the contract in two different ways:

Evergreen renewal

In an evergreen renewal, towards the end of the contract term, the contract will be automatically renewed for the duration that the contract owner had entered in the Renewal Term field in the New Contract form at the time of contract creation.

Manual renewal

In a manual renewal, the contract owner must manually renew the contract before the contract expires. The contract owner can set an expiration reminder in the New Contract form when creating the contract to receive a notification.

Never miss out on a renewal opportunity

Make the termination process hassle-free

Zoho Contracts makes the termination process more transparent by effectively communicating the reasons for termination to the counterparty.

Even after termination, contracts are stored in the centralized contract repository. This allows contract managers to keep track of the terminated contracts and derive insights from them when required.

Zoho Contracts also tracks the gain or loss from all your contracts based on the financial details in them. Admins can see the overall gain or loss incurred from all of their contracts on their personalized dashboard.

Make the termination process hassle-free

Achieve compliance and mitigate risks with activity tracking

Keeping track of incorporated changes in your contracts helps you measure the overall success of your organization's contract management process. All activities performed in Zoho Contracts are stored in a central audit system that is easily accessible. Every change can be traced back to the individual who performed the activity. This feature ensures better security, accountability, and compliance.

Achieve compliance and mitigate risks with activity tracking

Turn change management into your competitive advantage

More From Forbes

The future of leadership: from change management to team dynamics.

Forbes Business Development Council

  • Share to Facebook
  • Share to Twitter
  • Share to Linkedin

Founder and principal consultant of Vertil & Company, a consulting firm dedicated to empowering nonprofits to realize their strategic goals.

In a world that never pauses, how do you see your role as a leader adapting? Can traditional leadership and change management approaches stand the test of time?

Over the last four years, the leadership landscape has dramatically transformed, driven by rapid technological advancements and the unforeseen challenges of the Covid-19 pandemic. This era has unveiled the fragility of traditional change management approaches, compelling many leaders to adopt a more holistic change mindset . Central to this evolution is recognizing how psychological safety within teams plays a key role in resilient leadership. It's a departure from the past, where rigid control and predictability once dominated, and a move toward a future where understanding and adapting to human emotions will play a pivotal role in decision-making and team dynamics.

Evolving Beyond Change Management

The transition from conventional change management to a change mindset marks a critical pivot in how leaders approach the complexities of human and organizational behavior. The pandemic has served as a stark reminder of the inadequacy of previous leadership models, pushing leaders to confront and mitigate team anxieties associated with the shift to hybrid or fully remote models.

Embracing a change mindset involves a deep dive into the intricacies of leadership, focusing on creating an environment where psychological safety is paramount, and the human element is integral to strategic decision-making. This evolution underscores a broader understanding that successful leadership is inherently tied to the well-being and engagement of teams, heralding a new era where adaptability, empathy and resilience support effective management.

Best High-Yield Savings Accounts Of 2024

Best 5% interest savings accounts of 2024, elevating leadership through psychological safety: a strategic imperative.

Embracing psychological safety transforms workplaces into arenas where ideas flourish, and change is embraced. This paradigm shift, where each team member's contribution is valued, not only catalyzes creativity but also fortifies the foundation for tackling the intricacies of modern project management.

Imagine working in a team where every voice matters, where pursuing innovation replaces the fear of judgment. This isn't just an ideal; it's the reality in environments where psychological safety is integrated with leadership. Here, ideas don't just reside beneath the surface—they are integrated into strategies that propel businesses forward. Such a culture not only ignites creativity but also equips teams to navigate complexity with a sense of ownership and agility. It's a world where change isn't just accepted; it's celebrated.

Embracing Change For Organizational Growth

Resistance to change is a common hurdle in business evolution. The mindset of "If it isn't broken, why fix it?" often stems from a preference for stability but can lead to a failure to explore potentially transformative opportunities. This status quo bias can significantly stifle a company's growth, as reluctance to embrace risk precludes innovation and adaptability.

For businesses to thrive, it's essential for leaders to challenge this bias, encouraging a culture where risk-taking is valued and the pursuit of new, efficient processes is integral to organizational development.

Championing New Leadership Paradigms For Strategic Impact

The adoption of a holistic change mindset redefines the contours of contemporary leadership, moving beyond traditional doctrines to practices that amplify project success and foster dynamic team interactions. This era demands leaders proficient in navigating uncertainties and cultivating an inclusive culture that champions both safety and innovation.

In the article " Getting Personal About Change ," Scott Keller and Bill Schaninger, who have both served many years as Senior Partners at McKinsey, highlight that the journey toward holistic leadership requires the acknowledgment of and addressing unconscious biases. These biases include the resistance to new ideas or processes due to preconceived notions. A real-world example might involve a project lead who's influenced by a bias toward seniority and overlooks innovative solutions from junior team members.

Remediation lies in structured interventions such as inclusive decision-making processes and bias-awareness training, ensuring a leadership approach that is both empathetic and innovative.

Final Thoughts

Looking forward, the essence of leadership in strategic management is unequivocally holistic. Embracing a change mindset and prioritizing psychological safety isn't just necessary—it's a golden opportunity for those ready to lead with empathy and innovation.

This isn't merely a trend; it's a fundamental evolution in the DNA of effective leadership. As we step into 2024 and beyond, let us be the pioneers of this new paradigm, leading with courage, insight and a deep commitment to our teams' growth and well-being.

Forbes Business Development Council is an invitation-only community for sales and biz dev executives. Do I qualify?

Eddy Vertil

  • Editorial Standards
  • Reprints & Permissions

Canton Township dumps GFL, approves $26 million trash contract with Priority Waste

contract change management

CANTON TWP. — After a long stretch of difficulties with its current provider, township leaders have chosen a new company to collect refuse, recyclables and yard waste — but say residents should be patient during the transition period this summer.

At its meeting Feb. 13, the Canton Township Board of Trustees voted 6-0 to approve a five-year, $26 million agreement with Priority Waste.

Priority Waste will take over collections from GFL Environmental during the first week of August with a contract extending to July 31, 2029.

Making a change

The township’s contract with GFL Environmental expires July 31.

“We've had significant challenges with GFL over the past two years, and it was under the guidance and advice of the supervisor's office we went out for bid for a new provider,” said Dave Norwood, Canton Township’s director of municipal services. “We’re pretty pleased with what (Priority Waste) is offering the township.”

The current assessment of $195 and collection day schedule will remain the same, he said, and Priority Waste will provide residents with a 95-gallon trash cart to replace the current protocol of using 35-gallon containers and garbage bags.

The five-year contract, Norwood noted, will offset the cost of the trash carts for the company.

“They need to capitalize on the cost and return on their investment,” he said. “However, we are going to be protecting the township from some challenges that we had with GFL through the contractual arrangements. We’ll be putting some things in the contract that we did not have in the past to certainly protect the residents of Canton.”

Showing up every week

Dan Venet, vice president of municipal sales for Priority Waste, said residents can expect consistency from the company.

“We hear from our customers that they just want us to show up — every week,” Venet said. “We may alter routes a little bit, but we have never had an issue where we had to suspend any kind of service or push a service to a Saturday to compensate for mechanical or employee issues.

“At times, there may be a delay because of operations in the field that we encounter, like just a couple weeks ago, those really bad, cold days," he added. "But it's a collaboration with the department of public works and our colleagues to find a solution for the problem as opposed to just saying, ‘too bad, so sad.’”

The company, he said, will also answer the phone when residents call, and has an average hold time of 25 seconds and an average call time of less than three minutes.

Technology is also integrated into the company's platform to help provide better service, he noted.

“So not only is it the guy in a truck...picking up your three different waste streams, you have a full network behind the scenes that's watching them operate...through our camera systems, our routing software,” Venet said. “That way, when and if there is an issue, it's not just the person in the truck on an island any more. They now have that backend support to problem solve for them."

'This is going to be a transition'

Canton Township trustees voiced full support of making the change to Priority Waste, but some cautioned residents to temper initial expectations.

“I’m very much looking forward to better service," Trustee Kate Borninski said. “I do want to tell the community though that this is going to be a transition, so we may not see that great service right away. I'm sure we will get the kinks worked out and get it to where it should be.”

Trustee Sommer Foster agreed.

“Shifting waste collection agencies is going to be a huge thing," Foster said. "Given what I've heard about this provider from other communities that use them, they do provide good work.”

Clerk Michael Siegrist was also supportive.  

“I have been unhappy with the consistency in the trash service that we've received in the township for quite some time and I am looking forward to new days with a new vendor,” he said.

The township plans to launch a public education campaign in the months ahead to inform residents about new procedures and to address questions regarding the change. 

Contact reporter Laura Colvin at [email protected] or 248-221-8143 .

Get the latest headlines for metro Detroit every morning in your mailbox by signing up for our daily briefings newsletter .

Global Activity image

Search Jobs

Keyword Search

City, State, or ZIP

Search radius Radius 5 miles 15 miles 25 miles 35 miles 50 miles

contract change management

Working at Lockheed Martin

Contract management (hybrid telework).

Colorado Springs, Colorado & Additional Locations

Colorado Springs, Colorado; King of Prussia, Pennsylvania; Littleton, Colorado; Orlando, Florida

Job Responsibilities

  • Success Profile
  • Meet Our Employees
  • Related Content

At Lockheed Martin, we apply our passion for purposeful innovation to keep people safe and solve the world's most complex challenges.

Mission-Focused Innovation: From aerospace to outer space to cyber space, you can solve the world's most complex challenges for our customers.

Foundational Values: Our culture of performance excellence, ethics, teamwork and inclusion is embedded in everything we do.

Diverse Career Opportunities with Meaningful Work: Grow your career and skills for life. Our technology-driven learning platforms and programs enable your development and agility.

Your Health, Your Wealth, Your Life: Our flexible schedules, competitive pay and comprehensive benefits enable you to live a healthy, fulfilling life at and outside of work.

Empowered to Be Your Best: Use your strengths to make a difference in the lives of one another, our customers, our communities and our planet.

Commitment to Sustainability: We foster innovation, integrity and security to preserve the environment, strengthen diverse communities and propel growth.

Here, the possibilities are endless because we offer:

  • Flexible Schedules, dependent on role
  • Levels: Student, Entry, Mid, Senior, Management
  • Locations: Nationwide & OCONUS Positions

Back to Job Navigation (About)

Qualifications

See what it takes to be a successful Lockheed Martin employee.

There is no innovation without imagination. You bring new, different and exciting ideas to the table every day. You are committed to the success of your team.

The ability to explore and drive new ideas. You think innovatively to come up with creative solutions to complex challenges.

From planning and organizing to decision making, goal orientation produces impactful results. You set goals and strive to make things happen quickly and efficiently.

The ability to anticipate, plan and prepare for what lies ahead. You act rather than react to potential situations.

You work to tackle tough problems with complex solutions.

You observe, reflect and analyze processes to make more informed decisions.

Back to Job Navigation (Qualifications)

“Before I came to Lockheed Martin, I never thought I’d get these opportunities. The benefits available and the company’s value culture make it an incredibly supportive place to work, and I’m grateful to work somewhere that wants me to succeed. I hope to have a long career here making an impact, and I know I’ll be supported in doing that every step of the way.” Ryan J., Enterprise Operations

Medical, Dental and Vision coverage is available for employees who opt-in.

401(k)/Retirement Plans

Our 401(k) plan features generous matching and company contributions.

Professional Development

We support our employees through mentoring, internal & external educational programs, networking, skills enhancement and career-building programs.

Maternity and Paternity Leave

Our generous parental leave policies support your journey into parenthood. When you return to work, our facilities offer mother's rooms to support your transition and work/life balance.

Paid Time Off

We offer PTO, paid holidays and paid time off for jury duty and military obligations.

Depending on the position, we offer flexible work schedules.

Back to Job Navigation (Benefits)

Together, Let's Change The World For The Better.

From green energy to aerospace, there are so many ways you can make a difference with us.

Applying at Lockheed Martin (Video)

Applying at Lockheed Martin

We’re thrilled that you are interested in joining the team at Lockheed Martin! Since applying for a job can be a bit of a mystery at times, we wanted to let you know exactly what to expect during the process with Lockheed Martin.

Man running

Lockheed Martin: In The Community

Evan Sanders, a running miracle himself, survived his battle with cancer and is now one of the many Lockheed Martin employees who give back to their communities. Learn more here.

Lockheed Martin 2020 aircraft

Year in Review: The Missions, Milestones and Challenges Faced in 2020

As the world faced unprecedented challenges this year, we continued to deliver on our mission and support our customers around the world.

Team boarding aircraft

Living our Company Values Amid COVID-19

Throughout the COVID-19 pandemic, our employees have lived the company’s core values of doing what’s right, respecting others, and performing with excellence.

Share this Job

Explore the area.

Colorado Springs — Colorado

What should you and your team members do after work? Find the best places to hang out around the city.

Join our talent network and receive company news and job alerts to your inbox.

Email Address

Job Category Select a Job Category Administrative Aeronautical Engineering Artificial Intelligence Artificial Intelligence/Machine Learning Assembly/Laborers Business Development Call Center Chemical Engineering Contracts Craft Workers Cyber Architecture Cyber Engineering Cyber Intelligence Cyber Security Cyber Security Architect Cyber Security Engineering Cyber Security Governance and Risk Compliance Data Science Electrical Engineering Electro-Optical Engineering Electronics Engineering Enterprise Operations Environment Safety and Health Facilities Finance Guidance, Navigation and Control Hardware Engineering Human Factors Engineering Human Resources Information Assurance Information Security/Information Assurance Information Technology Intelligence Analysis Logistics Management Manufacturing Material and Distribution Materials Engineering Mechanical Engineering Media Services Miscellaneous Engineering Missiles and Fire Control Office and Clerical Product Support Production Operations Program Management Program Planning Public Relations Publications and Graphic Arts Purchasing/Procurement/Supply Chain QA/Test and Inspection RF Engineering Rotary and Mission Systems Scientist Security Software Engineering Space Systems Architect Systems Engineering: Assembly/Integration and Test Systems Engineering: Design and Verification Systems Engineering: Information Assurance Systems Engineering: Models and Simulations Systems Engineering: Network Systems Engineers Systems Engineering: Other Systems Engineering: Requirements Development Systems Engineering: Software Systems Engineering: Specialty Engineering Systems Engineering: System Architecture Systems Engineering: System of Systems Integration Technicians Test Engineering

Location* Select Location ‘Ewa Beach, Hawaii Andover, Massachusetts Annapolis Junction, Maryland Archbald, Pennsylvania Arlington, Texas Arlington, Virginia Arnold, Missouri Aurora, Colorado Baltimore, Maryland Bath, Maine Beaufort, South Carolina Bethesda, Maryland Bothell, Washington Boulder, Colorado Bridgeport, Connecticut Bridgeport, New Jersey Buellton, California Camden, Arkansas Camden, New Jersey Cannon Air Force Base, New Mexico Cape Canaveral, Florida Carlsbad, California Chantilly, Virginia Chelmsford, Massachusetts Cherry Hill, New Jersey Cherry Point, Marine Corps Air Station, North Carolina Chicago, Illinois Clarksburg, West Virginia Clarksville, Tennessee Clearwater, Florida Colorado Springs, Colorado Courtland, Alabama Dahlgren, Virginia Dallas, Texas Dayton, Ohio Denver, Colorado Doral, Florida Eagan, Minnesota Edwards Air Force Base, California Eglin Air Force Base, Florida Eielson Air Force Base, Alaska El Segundo, California Englewood, Colorado Fallon, Nevada Fayetteville, North Carolina Fort Belvoir, Virginia Fort Benning, Georgia Fort Bragg, North Carolina Fort Campbell North, Kentucky Fort Meade, Maryland Fort Smith, Arkansas Fort Walton Beach, Florida Fort Worth, Texas Fredericksburg, Virginia Goleta, California Grand Prairie, Texas Greensboro, North Carolina Greenville, South Carolina Groton, Connecticut Hamilton, Washington Hanover, Maryland Henderson, Nevada Herndon, Virginia Hickam Air Force Base, Hawaii Highlands Ranch, Colorado Hill Air Force Base, Utah Hooks, Texas Huntington Beach, California Huntsville, Alabama Hurlburt Field, Florida Jacksonville, Florida John F Kennedy Space Center, Florida Johnstown, Pennsylvania Joint Base Lewis McChord, Washington Jupiter, Florida King George, Virginia King of Prussia, Pennsylvania Kings Bay Base, Georgia Kirtland AFB, New Mexico Lakeland, Florida Langley Air Force Base, Virginia Langley Field, Virginia Las Vegas, Nevada Lawton, Oklahoma Lemoore, California Lexington, Kentucky Little Rock Air Force Base, Arkansas Littleton, Colorado Liverpool, New York Longmont, Colorado Lufkin, Texas Luke Air Force Base, Arizona Madison, Wisconsin Manassas, Virginia Marietta, Georgia Marine Corps Base Camp Lejeune, North Carolina Mayport, Florida Melbourne, Florida Milwaukee, Wisconsin Minneapolis-St. Paul-Bloomington, Minnesota Montgomery, Alabama Moody Air Force Base, Georgia Moorestown, New Jersey Mount Laurel, New Jersey NAS Pax River, Maryland Nellis Air Force Base, Nevada New Orleans, Louisiana New York, New York Niagara Falls, New York North Charleston, South Carolina Ocala, Florida Offutt Air Force Base, Nebraska Oldsmar, Florida Orlando, Florida Orogrande, New Mexico Owego, New York Palmdale, California Palo Alto, California Pearl Harbor, Hawaii Pinellas Park, Florida Quantico, Virginia Riviera Beach, Florida Rockville, Maryland Rosamond, California San Diego, California Santa Cruz, California Scott Air Force Base, Illinois Shelton, Connecticut Silverdale, Washington South Burlington, Vermont Springfield, Virginia Stratford, Connecticut Suffolk, Virginia Sunnyvale, California Titusville, Florida Troy, Alabama Tullahoma, Tennessee Uniondale, New York Vineyard, Utah Virginia Beach, Virginia Warner Robins, Georgia Washington, DC Westford, Massachusetts White Sands Missile Range, New Mexico Yuma, Arizona

  • Contracts, Colorado Springs, Colorado, United States Remove
  • Contracts, King of Prussia, Pennsylvania, United States Remove
  • Contracts, Littleton, Colorado, United States Remove
  • Contracts, Orlando, Florida, United States Remove
  • Rotary and Mission Systems, Colorado Springs, Colorado, United States Remove
  • Rotary and Mission Systems, King of Prussia, Pennsylvania, United States Remove
  • Rotary and Mission Systems, Littleton, Colorado, United States Remove
  • Rotary and Mission Systems, Orlando, Florida, United States Remove

Confirm Email

Featured Jobs

  • Systems Administrator - ALIS - Level 3
  • ALIS Multifunctional Administrator- Florennes, Belgium
  • Mult Function Info Systems ALIS Asc Manager (Florennes, Belgium)
  • Multi Functional Information Systems Analyst (MPE Admin)
  • Info Systems Administator DBA Level 3
  • Material Handler - F-35 - Level 3

Recently Viewed Jobs

You have not viewed any jobs.

contract change management

10 Innovations that Will Change Construction As We Know It

construction innovations shape the future of the industry

Construction innovations are progressing rapidly, and the industry now has a tremendous amount of resources to advance construction technology. Construction tech funding held steady at $5.38 billion in 2022 .  

These investments in innovations pay off significantly; research shows that firms that are rated as “digitally savvy” outperform companies by as much as 48% on revenue and 15% on net margin. And this is true across many fields, including AEC.   

Research also show that when asked to self-assess, 25% of businesses overate their ability to use data effectively and a whopping 80% of construction businesses are classified as beginner or emerging levels of data capabilities.  

There’s never been a more exciting time to be a part of the construction industry. As it continues to change at an accelerated pace, innovations will bring about even more developments and advancements. Here are 10 innovations we believe will shape the future of the industry as we know it today. 

1. AI and Machine Learning

Optimized workflows are essential to well-running projects and teams in the AEC industry. However, due to the complexity of construction, workflows have the tendency to be disconnected and manual in nature. The three most significant areas within optimized construction workflows are communication, data, and transparency. AI is making it easier to succeed across all three of these areas, resulting in greater productivity and profits. The fact that Construction Management Association of America (CMAA) proclaimed AI has the potential to increase industry profits by 71% by 2035 doesn’t hurt either. 

Machine learning is helping construction pros optimize their workflows and aid decision-making. Predictive analytics is quickly establishing its foothold in the construction industry’s core stack of technology tools. By leveraging current and historical data as well as machine learning, companies can make predictions about future outcomes. These predictions can then be used to make more informed decisions and strategize next moves. Research has also shown that data leaders in construction are 7x more likely to be using AI and machine learning.  

Predictive analytics and machine learning are especially valuable in today’s world of complex construction projects and operations. Companies need a precise way to mitigate risks, take advantage of opportunities, and prepare for challenges. This information also gives workers the freedom to focus on higher-value activities that are more likely to move the needle.  

BAM Ireland is an excellent example of this benefit. The multinational construction company leveraged Construction IQ, powered by Autodesk AI , as its predictive analytics tool for all projects. Doing so led to a 20% improvement in on-site quality and safety and a 25% increase in time spent on high-risk issues. 

Some construction AI innovations are even more subtle. For instance, another tool, AutoSpecs , allows you to find and track submittal items that may not have been added to the specification. The suggested submittals tool compares your current project specifications with historical project data and recommends potentially missing items to enhance accuracy and mitigate risks associated with overlooked details.

Watch to learn more:

What is AI’s Proper Place in Construction?

2. Resource and Workforce Management Software

Managing resources and a workforce are massive expenses for construction companies. Effective workforce management can help companies keep operations running smoothly, optimize resource allocation, and avoid unexpected expenses as well as delays. 

Today, more companies are turning to software platforms to bring more efficiency and actionable analytics to their workforce, whether they be remote, on-site, large, or small. 

Construction innovations in workforce management solutions include predictive tracking, forecasting, and mobile-first interfaces. These solutions remove many of the manual processes that come with resource planning. 

Bridgit Bench is a workforce planning solution built for contractors to track pursuits, project changes, and forecast workforce needs. Project teams can push awarded and opportunity projects from Autodesk Construction Cloud to Bridgit Bench, keeping projects up to date as changes are made. 

One tool, Riskcast provides a way for crews to easily capture labor, equipment, and production plus more, without multiple systems and complex spreadsheets. Teams can sync real-time data into Autodesk Cost Management Performance Tracking to see actuals vs. planned.  

Solutions like these allow companies to access metrics and forecasting analytics to better allocate resources to the right projects at the right time. Workforce management solutions are especially important in our current economy, where volatile markets require firms to be as precise and efficient in their operations as possible. 

3. The Next Wave of 3D Printing

3D printing has long been cited as one of the top modern construction innovations. However, its future is even brighter these days as the technology moves from a novelty to an emerging industry standard. 

With the right implementation strategy—and some creative thinking—3D printing can help speed up projects, make materials more accessible, and enable you to create beautiful designs.  

As Stephan Mansour, a 3D Printing & Emerging Technology Advisor at MaRiTama Ltd points out , “Everything can be 3D-printed; it’s just a matter of how far you want to go, how scalable it is, and how much money you’re going to put in.” 

In terms of use cases, you can 3D print design elements like facades to make them more intricate and detailed. 3D printing can also be used to print parts, fixtures, and furniture for your building. This is particularly useful when you’re dealing with supply shortages or when you’re working in a remote area. Rather than waiting weeks or months for the materials you need, you can print them within a few hours or days. 

We can expect to see 3D printing technologies continue to mature and grow in the future. As companies look for ways to improve quality control, address skilled labor shortages, and explore advanced designs, 3D printing will be here to help them make it a success. 

4. AR, VR, and the Metaverse

Extended Reality (XR) serves as the encompassing term for a spectrum of captivating and interactive technologies, including Virtual Reality (VR), Augmented Reality (AR), and Mixed Reality (MR). These transformative experiences are accessible through various devices, ranging from mobile devices to VR headsets. The allure of XR lies in its ability to seamlessly immerse individuals in the digital realm in real-time. 

This technology plays a pivotal role in revolutionizing Architectural, Engineering, and Construction (AEC) workflows as highlighted by the announcement of Autodesk Workshop XR, an immersive design review workspace. The evolution of XR is swiftly paving the way for more impactful and efficient work processes. With innovations like Workshop XR, AEC teams are discovering new avenues for issue tracking, error prevention, and enhanced spatial understanding, ultimately improving workflows and integration. 

The increasing adoption of XR signifies a paradigm shift in how we approach work, collaboration, and project success. This dynamic environment enables teams to scrutinize and problem-solve within their 3D models in a 1:1 scale, fostering a level of interaction that transcends traditional computer screens. 

Businesses—particularly those reliant on cross-departmental collaboration—stand to gain enormous benefits from extended reality solutions. Autodesk Workshop XR, with a connection to Autodesk Construction Cloud through Autodesk Docs, facilitates real-time collaboration within Revit or Navisworks models, making XR a driving force in the AEC industry’s technological wave. 

5. Sensor Data

Tracking the various components of your business—including manpower, jobsites, and equipment—is essential. Proper monitoring aids project planning, promotes smoother operations, and ensures compliance with safety and worker regulations.  

Here’s the good news: thanks to construction sensors and IoT technology, keeping an eye on the many moving parts of your projects is easier than ever. There are various solutions in the market that can enable you to monitor site conditions, track materials through the supply chain, improve worker safety, and empower better facility management. 

Forward-thinking firms are also using sensors to forecast and prepare for future events. “With the use of sensor data and Forge as a software foundation, we are able to predict future product failures,” explains Chris Schoneveld, BIM Manager at Alkondor Hengelo .  

“So for a maintenance task, we could analyse the use curve of a building and protect our products against future failures. And doing multiple tasks on a single maintenance job benefits our company’s eco footprint due to a minimization of traffic movement.” 

6. Digital Twins

Digital twins is certainly a buzzworthy term, but what benefit does it have for the construction industry? As it sounds, a digital twin is a digital replica of a physical entity, including its potential and current assets, systems, data, processes, workflows, people, and devices. In the context of construction, building out a digital twin from the very start is significant to better understand a physical structure for future operations. 

Having a duplicate source of a physical structure allows workers to assess, manipulate, and optimize the building. As they analyze the digital twin, they can uncover potential means of creating efficiencies, developing safety protocols, reducing risks, and improving quality. Digital twins also enhance BIM by serving as a digital thread, connected directly to a physical structure. 

Since almost 80% of a building’s lifetime value is realized during operations , the data and insights provided by a digital twin helps owners better maintain their facilities, streamline operations, and improve capital planning.  

You can also use digital twins to determine if a built asset is meeting certain KPIs and metrics. “If you have certain sustainable goals, you’ll be able to see if you’re achieving them. If you have equipment and want to measure mean time between failure, having a digital twin helps you do that,” explains Bob Bray, Senior Director & General Manager for Autodesk Tandem . 

It can also help owners strategize for the future. As Bob points out, “A digital twin gives you the knowledge to inform, predict, and look at future decisions based on how that asset is performing in the real world.”  

Lastly, the advantages of digital twins are especially relevant during times of social distancing, remote work, and travel restrictions. Essential information about a property is readily accessible with a digital twin, avoiding the need to travel or even leave a home office. 

Check out Episode 59 of the Digital Builder podcast to learn more about Digital Twins.   

7. Truly Connected Construction

Simplicity in construction? It might not be a buzzword, but we’d argue that simplicity is the lifeblood of the most powerful of innovations. When data, workflows, and technology connect, they’re all the more powerful. Apple is a key example of this fact. The same information flows seamlessly between the company’s iPhones, iPads, and MacBooks. These harmonious connections keep things simple and effective. 

We see the same concepts play out in connected construction. Construction companies often have to deal with information silos and paper-dependent processes. These challenges are exacerbated by the massive volumes of data and resources that make up the industry. For stakeholders to work efficiently on projects, they need a solid foundation, a single source of truth. 

This foundation can be built and maintained with connected construction. Connected construction equates to integrated and connected data, workflows, and technology. It brings information, processes, and people together in one common data environment . It powers effective decision-making, whether they occur during daily operations or as part of a long-term strategic plan. For companies that genuinely want to empower their people to make the most informed decisions possible, connected construction is the answer.  

8. Advanced Takeoff and Estimating Tools

The days of relying solely on spreadsheets to put together quantity takeoffs, estimates, and bids, are over. Or at least, they should be. The rise of advanced tools in preconstruction are helping construction pros implement robust bidding and estimating processes so they can focus more on winning more business and reducing risk.  

Modern takeoff, estimating, and bidding solutions work in the cloud, enabling you to view and manage bids and estimates from anywhere. These tools also help connect data and teams on one platform, leading to better collaboration and accuracy. And thanks to automation and 3D visualization, you’re able to work faster, produce competitive bids, and ultimately win more work.   

Autodesk Takeoff helps contractors easily perform 2D and 3D quantification and ProEst’s estimating solution helps translate project scope into material, labor and equipment costs to generate accurate project estimates. From there, contractors can use BuildingConnected’s bid management solution to choose the right builder for every project from the largest crowd-sourced construction network, reducing risk and protecting the bottom line. 

9. BIM Beyond Design

BIM, or building information technology modeling, is widely used in the design world but is often seen as complex and technical outside of it. However, BIM doesn’t have to be complicated. By sharing models between the design department and the field, BIM can be a simple and effective communication tool.  

There are many advantages to facilitating BIM access in the field. When models are distributed as PDF documents, valuable BIM data can be lost. By using BIM in the field, teams can improve communication, increase data visibility, and reduce rework costs.  

According to John Lim Ji Xiong, Chief Digital Officer, Gamuda Bhd, “In 2024, I think construction industry trends will morph from BIM and 3D modeling to more data-driven topics such as building dashboards, AI, and managing project data. BIM has become something that is mature in the industry and is a requirement in a lot of tenders. However, in the drive to modernize and improve, construction companies will be looking to drive efficiency and transparency through data in order to build better projects.” 

Expanding the use of BIM beyond design streamlines communication, provides a richer view of construction documents, promotes safety and reduces rework. By keeping design and field teams aligned through BIM, collaboration improves, and work gets done faster.  

Furthermore, new AI innovations open even more opportunities for BIM. “This year, we’ll see greater momentum and interest from the industry as firms leverage AI-driven technologies to automate tedious tasks, more deeply analyze information, and augment decision-making,” says Jim Lynch, Senior Vice President and General Manager, Autodesk. “Particularly, the integration of BIM with AI poses new and exciting opportunities. BIM’s rich data, paired with machine learning, can enable firms to improve efficiency and make smarter decisions beyond just the design phase of a building.” 

It’s time to rethink the role of BIM in construction. BIM is not just a design tool every team can use to deliver high-quality work and improve collaboration throughout the construction lifecycle.  

10. Robotics

The continued adoption of robotics in construction is another significant development that will shape the industry’s future. However, construction companies face barriers in implementing these technologies including cost of entry and a lack of skills with these specific technologies within teams  

On an episode of the Digital Builder podcast, Brooke Gemmell, Emerging Technology Partner at Skanska said, “We’re starting to see so many more robotic applications. I think one thing that may be a misconception is just how readily available they are on projects. Most of the tools out there are only being piloted on a select few projects because we’re still learning how can we really use these and what’s the biggest impact for these tools.” 

To overcome these hurdles, companies can start with more mature technologies like drones and offsite prefabrication. They also can invest in training programs and partnerships with technology providers to improve their workforce. Brooke believes there is already a strong appetite from the workforce to do so, “I’ve been on a lot of project sites where we’ve had robotic solutions deployed, and first off, people are really excited about it. They want to learn more and they want to engage.” 

Collaboration and communication with technology providers is crucial. By sharing specific needs and challenges, construction companies can shape the development of tailored AI and robotics solutions. It is also beneficial to learn from industry leaders who have effectively incorporated these technologies.  

By embracing AI and robotics, construction companies can unlock productivity, efficiency, and safety benefits. These technologies will greatly improve workflow, optimize resource management, and enable faster project delivery.  

“Robots are helping people go home earlier, less tired, and with less strain. We’re also taking people out of dangerous situations and using robots in those places,” added Brooke.  

The Real Impact of Robotics on Construction Sites

Moving Innovation in Construction Forward

The construction industry is truly evolving right in front of our eyes. We’re confident these 10 construction innovations will prove to be especially valuable in the industry today and in the future. 

Grace Ellis

Construction trends, tips, and news – delivered straight to your inbox, you might like..., demystifying autodesk technology: unlocking efficiency for factory planning and factory design, digital builder ep 77: what is ai’s proper place in construction, using digital technology for project success in denmark’s construction sector.

U.S. flag

An official website of the United States government

Here’s how you know

Official websites use .gov A .gov website belongs to an official government organization in the United States.

Secure .gov websites use HTTPS A lock ( ) or https:// means you’ve safely connected to the .gov website. Share sensitive information only on official, secure websites.

GSA Logo

  • Explore sell to government
  • Ways you can sell to government
  • How to access contract opportunities
  • Conduct market research
  • Register your business
  • Certify as a small business
  • Become a schedule holder
  • Market your business
  • Research active solicitations
  • Respond to a solicitation
  • What to expect during the award process
  • Comply with contractual requirements
  • Handle contract modifications
  • Monitor past performance evaluations
  • Explore real estate
  • 3D-4D building information modeling
  • Art in architecture | Fine arts
  • Computer-aided design standards
  • Commissioning
  • Design excellence
  • Engineering
  • Project management information system
  • Spatial data management
  • Facilities operations
  • Smart buildings
  • Tenant services
  • Utility services
  • Water quality management
  • Explore historic buildings
  • Heritage tourism
  • Historic preservation policy, tools and resources
  • Historic building stewardship
  • Videos, pictures, posters and more
  • NEPA implementation
  • Courthouse program
  • Land ports of entry
  • Prospectus library
  • Regional buildings
  • Renting property
  • Visiting public buildings
  • Real property disposal
  • Reimbursable services (RWA)
  • Rental policy and procedures
  • Site selection and relocation
  • For businesses seeking opportunities
  • For federal customers
  • For workers in federal buildings
  • Explore policy and regulations
  • Acquisition management policy
  • Aviation management policy
  • Information technology policy
  • Real property management policy
  • Relocation management policy
  • Travel management policy
  • Vehicle management policy
  • Federal acquisition regulations
  • Federal management regulations
  • Federal travel regulations
  • GSA acquisition manual
  • Managing the federal rulemaking process
  • Explore small business
  • Explore business models
  • Research the federal market
  • Forecast of contracting opportunities
  • Events and contacts
  • Explore travel
  • Per diem rates
  • Transportation (airfare rates, POV rates, etc.)
  • State tax exemption
  • Travel charge card
  • Conferences and meetings
  • E-gov travel service (ETS)
  • Travel category schedule
  • Federal travel regulation
  • Travel policy
  • Explore technology
  • Cloud computing services
  • Cybersecurity products and services
  • Data center services
  • Hardware products and services
  • Professional IT services
  • Software products and services
  • Telecommunications and network services
  • Work with small businesses
  • Governmentwide acquisition contracts
  • MAS information technology
  • Software purchase agreements
  • Cybersecurity
  • Digital strategy
  • Emerging citizen technology
  • Federal identity, credentials, and access management
  • Mobile government
  • Technology modernization fund
  • Explore about us
  • Annual reports
  • Mission and strategic goals
  • Role in presidential transitions
  • Get an internship
  • Launch your career
  • Elevate your professional career
  • Discover special hiring paths
  • Events and training
  • Agency blog
  • Congressional testimony
  • GSA does that podcast
  • News releases
  • Leadership directory
  • Staff directory
  • Office of the administrator
  • Federal Acquisition Service
  • Public Buildings Service
  • Staff offices
  • Board of Contract Appeals
  • Office of Inspector General
  • Region 1 | New England
  • Region 2 | Northeast and Caribbean
  • Region 3 | Mid-Atlantic
  • Region 4 | Southeast Sunbelt
  • Region 5 | Great Lakes
  • Region 6 | Heartland
  • Region 7 | Greater Southwest
  • Region 8 | Rocky Mountain
  • Region 9 | Pacific Rim
  • Region 10 | Northwest/Arctic
  • Region 11 | National Capital Region
  • Per Diem Lookup

Privately owned vehicle (POV) mileage reimbursement rates

GSA has adjusted all POV mileage reimbursement rates effective January 1, 2024.

Airplane nautical miles (NMs) should be converted into statute miles (SMs) or regular miles when submitting a voucher using the formula (1 NM equals 1.15077945 SMs).

For calculating the mileage difference between airports, please visit the U.S. Department of Transportation's Inter-Airport Distance website.

QUESTIONS: For all travel policy questions, email [email protected]

The shortcut to this page is gsa.gov/mileage.

Have travel policy questions? Use our ' Have a Question? ' site

PER DIEM LOOK-UP

1 choose a location.

Error, The Per Diem API is not responding. Please try again later.

No results could be found for the location you've entered.

Rates for Alaska, Hawaii, U.S. Territories and Possessions are set by the Department of Defense .

Rates for foreign countries are set by the State Department .

2 Choose a date

Rates are available between 10/1/2021 and 09/30/2024.

The End Date of your trip can not occur before the Start Date.

Traveler reimbursement is based on the location of the work activities and not the accommodations, unless lodging is not available at the work activity, then the agency may authorize the rate where lodging is obtained.

Unless otherwise specified, the per diem locality is defined as "all locations within, or entirely surrounded by, the corporate limits of the key city, including independent entities located within those boundaries."

Per diem localities with county definitions shall include "all locations within, or entirely surrounded by, the corporate limits of the key city as well as the boundaries of the listed counties, including independent entities located within the boundaries of the key city and the listed counties (unless otherwise listed separately)."

When a military installation or Government - related facility(whether or not specifically named) is located partially within more than one city or county boundary, the applicable per diem rate for the entire installation or facility is the higher of the rates which apply to the cities and / or counties, even though part(s) of such activities may be located outside the defined per diem locality.

IMAGES

  1. DealHub Stages of Contract Management Infographic

    contract change management

  2. The Contract Management Process Made Easy

    contract change management

  3. The Role of Contract Management in Business Planning

    contract change management

  4. The Effective Contract Management Model: “ECoM”

    contract change management

  5. What is Contract Management? a guide to the key steps and benefits

    contract change management

  6. Contract Management

    contract change management

COMMENTS

  1. How to achieve effective contract change management

    Learn the rationale, principles, process and reporting of contract change management for contracts between two parties. Find out how to minimise the risk of unexpected outcomes, automate the process and use contract change management software.

  2. Best Practices for Change Management in Contracts

    Learn the best practices and objectives for change management in contracts and SOWs, and see a sample template for a change procedure. Change management is a process of agreeing, approving, and coordinating changes to the scope of a project or contract, and it should be part of your contract management lifecycle.

  3. Contract Change and Variation Management: A Guide

    The first step in managing contract changes is to have a clear and robust contract change and variation clause in your contract. This clause should define what constitutes a change, how...

  4. 8 Steps for an Effective Change Management Process

    Change management processes should include the following steps: First, identify opportunities for improvement and secure approval from stakeholders. Then, make a plan and evaluate your processes. Communicate the changes, monitor progress, and continue to assess any risks.

  5. What is contract change management?

    Contract change management refers to the process of identifying, planning, implementing, and managing modifications in a contract after its initial execution. When a contract hits the execution phase, a legally binding transactional relationship gets established between the parties involved.

  6. Successfully Navigating Change Management in Construction

    Change management in construction refers to any alteration to the original scope of work after the project has commenced. Whether the changes are simple or complex, they often affect a project's budget, cost, or schedule — and so should be handled carefully to minimize risks and avoid delays. Table of contents Why Change Management Matters

  7. The Contract Management Process Made Easy

    Learn how to streamline your contract management process and boost your revenue with Smartsheet templates. Find out what contract management is, how it affects your business, and what steps and tips you need to follow. Download a free contract management framework template and get a guide to effective contract management.

  8. PDF 100R-19: Contract Change Management

    1. Identification of Potential Change to Contract (Box 1) ................................................................................ 7 2. Contractor Submits Change Order Request to Owner (Box 2) ..................................................................... 8 3.

  9. The Contract Changes Management Process: Managing and Controlling

    The ConTr aCT Changes ManageM enT Pr oCess, ParT 2: Managing and C onTrolling C onTraCT Changes. Just as the authority for awarding, ad. ministering, and terminating contracts is. controlled in ...

  10. What is Contract Change Management? Definition

    Contract change management is the process of identifying, analyzing, and approving changes to a contract. The goal of contract change management is to ensure that changes are made in a controlled and consistent manner, while also protecting the interests of all parties involved in the contract.

  11. Change Orders: What They Are and How to Manage Them

    Using digital contract management for change orders and statements of work makes it easy to fill and update forms. All your information is easily accessible, from the original contract to the supplementary appendices. There's no back-and-forth necessary—Individual team members can fill in elements of the form when they're available.

  12. How to improve contract performance with effective change management?

    Contract change management is the systematic process of handling modifications and amendments to existing contracts. These changes can range from simple revisions to complex overhauls, all aimed at ensuring that contracts remain up-to-date and relevant in a dynamic business environment.

  13. Contract Change in Procurement: Adapting Agreements Effectively

    Best Practices for Successful Contract Change Management. When it comes to managing contract changes in procurement, following best practices is crucial. Here are some key strategies to ensure successful contract change management: 1. Clear Communication: Effective communication is the foundation of successful contract change management.

  14. Improve contract performance with effective change management ...

    Change management is the process of implementing adjustments to an active contract. Change can represent an opportunity to renegotiate elements, such as pricing or identify other improvements that can enhance contract performance or value.

  15. Change Control and Management, 1st edition

    Change Control and Management, 1st edition. Changes are almost inevitable during construction projects of any size. This guidance note gives advice on how to handle changes proposed and made after a contract is agreed, and covers the role of the person requiring the change, whether the employer's agent, the project manager or the contract ...

  16. Contract Change Management

    Contract Change Management is essentially the integration of every aspect of project controls - including schedule, cost, contract admin. Large companies and large projects have their own...

  17. How to Make a Change Management Plan (Templates Included)

    A change management plan is a process that implements a change or changes in a project or across an organization. You can think of a change management plan as a roadmap that shows all the steps you need to take from identifying the change to realizing it.

  18. What Is a Change Control Process? (with Example Change Log ...

    A change control process is a way for project managers to submit requests to stakeholders for review, that are then approved or denied. It's an important process to help manage large projects with multiple moving parts. When it comes to managing multiple projects, things can get complicated.

  19. PDF Contract Change Management or Change Control

    An effective change management process includes but is not limited to: Formal, written approval of all changes prior to the change taking place. Do not verbally authorize the supplier to begin working on a change before formal process is fully analyzed, documented and approved in writing.

  20. How to achieve effective contract change management

    Discover what contract change management is, the process that's required, and how you can make it a success throughout your business. Discover what contract change management is, and edit that's required, plus how you sack make it a achieve throughout your economic. ...

  21. Change Management Strategy Consulting

    BCG's change management consulting services help organizations beat these daunting odds. Change management efforts allow companies to reinvent themselves as new opportunities and challenges arise, leading to greater participation in—and earnest adoption of—critical transformation initiatives. This adaptability allows businesses to hone ...

  22. Why It Pays to Improve Contract Lifecycle Management

    In Deloitte's experience, improving the contract management process can potentially save some organizations upwards of 60%. But time and cost savings are not the only benefits. ... data privacy laws change. Some less complex contracts, such as nondisclosure agreements, can still take time to negotiate and therefore can become expensive to ...

  23. Contract Change Management

    Contract Change Managemen t is the process agreed between the Parties to a Contract to formalise the requesting, development and implementation of a Variation to the Contract. < Previous Next > Explore the definition for Contract Change Management and what it means for businesses.

  24. Change Management

    Keeping track of incorporated changes in your contracts helps you measure the overall success of your organization's contract management process. All activities performed in Zoho Contracts are stored in a central audit system that is easily accessible. Every change can be traced back to the individual who performed the activity.

  25. The Future Of Leadership: From Change Management To Team Dynamics

    The transition from conventional change management to a change mindset marks a pivot in how leaders approach the complexities of human and organizational behavior.

  26. Canton Township switches to Priority Waste for garbage, recycling

    Priority Waste will take over collections from GFL Environmental during the first week of August with a contract extending to July 31, 2029. Making a change The township's contract with GFL ...

  27. Contract Management (HYBRID TELEWORK)

    The successful candidate will need to demonstrate the ability to perform contracts management responsibilities, including but not limited to: - negotiate, coordinate, extend, terminate, and renegotiate standard and nonstandard USG/DCS contracts; - evaluate contract performance to resolve necessity for amendments or extensions of contracts, and

  28. 8 Innovations that Will Change Construction

    2. Resource and Workforce Management Software. Managing resources and a workforce are massive expenses for construction companies. Effective workforce management can help companies keep operations running smoothly, optimize resource allocation, and avoid unexpected expenses as well as delays.

  29. Privately owned vehicle (POV) mileage reimbursement rates

    Contract opportunities on SAM.gov Search current federal contract opportunities and procurement notices. Forecast of contracting opportunities Anticipated contracts offered by GSA. Vendor support center Research the federal market, report sales, and upload contract information.