Best Practices in Service Contracts - Getting good value and ensuring accountability Best Practices Building the Contract Managing the Contract Completion of the Contract Capturing new knowledge Building the Contract Building the Contract Client - define the expectations for a successful contractual relationship. Examples: – On time and at or below budget – Performance criteria – Customer survey results Building the Contract Contracting team (client, procurement) determine the contracting approach – Support selected success criteria – Partnership with Contractor – Determine key risks/mitigating strategies – Define roles – who will be managing the contract? Defining Expectations Building the Contract Define and execute a fair bidding and awarding process. – Model RF(x) by contract type Fixed price Cost reimbursement Time and Material Indefinite delivery – Ensure “Full Monty” bidding process Building the Contract 4-Negotiate a mutually agreeable contract that embodies the contracting approach. Clearly determine contract completion (date, acceptance…) – Client defines desired outcome – Contractor determines the best way to achieve that outcome – Clearly defined “Statement of Work” (SOW) Managing the Contract Managing the Contract Provide orientation for contractors. – Culture and norms of the client. Discuss performance measures, contract milestones etc. with key individuals. – Clearly define roles of Client / Contractor – Organization policy compliance e.g. harassment, workplace safety, parking, travel. Managing the Contract Monitor Performance and provide timely feedback. – Performance-based contracting Focus on output, quality or outcomes – Connect all the pieces Client desired expectations Contracted terms and deliverables exercise Managing the Contract Establish a clear communication process specific to the project – Reporting schedule KPI model Benchmarking metrics Competency standards for consultants – Meeting schedule Progress reporting to SOW Conflict resolution Completion of the Contract Completion of the Contract Contract completion based on contract type. – Acceptance – Fixed date – Final Milestone completion – Bonus or penalties for performance – Requirement for competitive evaluation Capturing New Knowledge Capturing New Knowledge Knowledge transfer to client Post mortem evaluation – RFP evaluation methods – contracting methodology – KPI metrics used – Communication methods – Update templates (rf(x), contract, letters etc.) Summary Funding agencies requiring more accountability and demonstrated value Ensuring value and accountability requires significant effort even before the RFP “Value add” for the procurement organization Best Practices in Service Contracts - Getting good value and ensuring accountability Questions? Bibliography Effectively Managing Professional Services Contracts. Sandra L. Fisher, Michael Wasserman, Paige P. Wolfe. IBM Centre for The Business of Government. Seven Steps to Performance Based Services Acquisition. U.S. Office of Federal Procurement Policy. It’s what’s up front that counts. Richard W. Walker, Government Computer News, 11/10/03 Contributions by: Bob Moore, Director, Purchasing - University of Western Ontario Paul Dugal, Manager, Purchasing Services – University of Manitoba Ron MacDonald, Chief Executive Officer-Interuniversity Services Inc.