Contract Management
Chapter Overview
• Elements of a contract
• How to write a contract
• Types of contracts
• Long-term contracts in alliances and partnerships
• Non-traditional contracting
• Settling contract disputes
Pitfalls in Global Commerce
• Signing contracts without reading them
• Making risky assumptions
• Making unreasonable demands
• Assuming terms in one market are the same as in another
• Not recognizing cultural or legal landmines
Preventive Contracting
• Fully understanding stakeholder requirements, expectations,
and communication of expectations
• Need for flexibility in contract terms and clauses
• It usually costs less to avoid getting into trouble than to pay for
getting out of trouble
What Does a Purchase Contract Do?
• Establishes the terms and conditions by which the parties agree to
conduct business
• Defines the type of relationship
• Provides a way for the parties to obtain mutual benefits
• Represents the understanding of the parties
Elements of a Purchase Contract
• Introduction of the contracting parties
• Definitions
• Scope of agreement
• Purchase orders
• Supply and delivery
• Specifications, quality, and health, safety, and environment
Elements of a Purchase Contract
• Payment
• Liability
• Force majeure
• Effective date and termination
• Intellectual property
• Assignment and contracting
• Technology improvements