Contract process cycle
Contract process goes through the following stages to complete the contract documentation cycle:
- Pre tender documentation stage.
- Approval of project manager for inviting tenders.
- Tendering documentation.
- Contract documentation.
- Amendments to contract.
- Closing of contracts.
Pre tender documentation stage: All the pre tender preparations are carried out in this stage. This involves collecting technical documents like detailed drawings, specifications, schedule of work and so on for civil, mechanical, electrical, hydraulic, pneumatic systems required for the project. Documents covering commercial clauses and statutory guidelines to be followed by the contractors also need to be prepared. These documents form a part of tender documents, which involves interaction with various agencies including both internal and external. The documentation personnel involved should be familiar with the nature of the project and its intricacies so that they can adopt a comprehensive approach to this activity.
Approval of project manager for inviting tenders: The personnel handling contract should obtain an approval from the project head or project manager prior to issuing the tender notification. This is essential as the project manager is the overall coordinator for the entire project and he will be executing the functions of planning, organising, directing and coordinating all the individual functions of the project. Any amends in the programme in terms of change in design, budget and so on may be incorporated in the tender documents in this stage of tendering. Slippages if any in parameters of the project plan will weigh heavily in terms of process time and project cost in this stage.
Tendering documentation: Issue of tender notice is the first activity in this stage of contract documentation. The notices are published in news papers, trade journals and portals based on the practice in vogue. Of late e-tendering has taken off in a big way. There are websites meant for tendering notices of various values and types of contracts. Tenderers can also respond to notices through electronic media. There are many advantages to this method like responding at short notice and eliminating the use of paper promoting environment friendliness. The following are essentials of the tendering documents to ensure flawless and smooth documentation process:
- Schedule of tender documents.
General conditions of tender (project completion schedule, method of payments, cancellation of tender and so on).
- Statutory guidelines to be followed (labour laws, safety laws and others).
- Required form of tender.
- Detailed drawings and specifications of the project.
- Last date for submission of tenders.
- Action on late submission of tenders.
- Arrangement for site inspection by tenderers.
- Deposit with tender documents, if any.
- Contact person details for clarifications.
- Criteria used to evaluate tenders.
Contracting documentation personnel should also make necessary arrangements to facilitate tendering and finalisation of tenders like:
- Forming evaluation committee for tenders received.
- Opening of tenders and evaluating the same.
- Taking action on late tenders.
- Negotiating with tenderers.