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In today’s competitive and hectic global economy, to stay ahead of the pack companies
have to embrace effective project management in order to consistently deliver business
results. As most of projects are complex and multi-disciplinary, to keep them on track
and constantly monitor the results, effective oversight of contracts is critically important.
On the other hand poor management of contracts ensue range of risks; from being forced
to close the projects due to breaking of the law to struggling on with supplier disputes.
There is no doubt, that effective contract management is paramount for it guarantees
organization in realizing its business value by successful delivering projects on time and
within budget.
The aim of this study is to assess the role of procurement contract management in the
effectiveness of project management at MIC-Tanzania. Research was executed by means
of questionnaires and interviews where employees from Supply Chain department and
other project stakeholders were invited to share their experiences of the same.
Literatures acknowledge the importance of contract management for effective contract
management by citing important terms and conditions for good contracts as well as the
essential features of valid contract. They also spell out the basis for supplier selection,
remedies for breach of project contracts, service level agreements, contract as a project
risks management tool as well as supplier relationship matrix.
This research has discovered that there is very high dependency of effective project
management on suppliers’ compliance with terms and conditions, suppliers’ technical
capability and close monitoring of suppliers during project implementation. Therefore,
contract management is essential for effective project management.
The researcher recommends MIC-Tanzania to recruit more experienced and qualified
staff for its contract management function, to have e-contract management solution in
order to have visibility of its active contracts at every stage of the project lifecycle, to
have strong technical supplier evaluation and to secure and enforce penalty clauses for
suppliers’ breach of project contracts. This is because the more MIC-Tanzania improves
its ability to manage its project contracts at practically every stage of project life-cycle,
the more it can transform contracting into a project management competency. |
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