Benefits of the R3 GovCon Contract Management System

More than half of Federal Government Contractors still use separate tools and manual work to manage their GovCon contracts. They will realize significant business benefits when they move to a formal, centralized GovCon Contract Management system such as the R3 Contract Management for GovCon solution.

In this article we describe the key benefits that GovCons realize when they move to our system.  The benefits fall into two main categories: Reduced Risk and Increased Effectiveness. These benefits are critical for the operational success of Federal Government Contractors. There is also a third benefit – Cost Savings.  While reducing risk and increasing your team’s effectiveness, you are also increasing their productivity.  Increased productivity means time saved, which translates into real dollars saved. For cost savings, we offer a spreadsheet tool that can help you work through the numbers.

Breaking Down the Benefits

Let’s look at each of the three categories of benefits.

Reduced Risk

By adopting the R3 Contract Management system you are proactively taking a decision to reduce risks of various types. A fundamental way that you reduce risk is by moving to a single, centralized source of information and having the ability to control access to the information. Below we list some of the specific risks you are reducing and how we accomplish this. This should spur some thoughts specific to your way of working.

1. Lack of control over information – in a manual environment, organizations usually face a choice of on or off. This means that people can access everything or nothing. If you open up the system you run the risk that mistakes can happen. Our system gives you role-based, controlled access. You can control what users can see and what they can do. This means that you can provide access to drive Increased Effectiveness, but, it is controlled.
2. A key contract person gets sick or leaves – instead of things being in their heads, the information, work and activity is now in a system. The work can carry on.
3. People work with the wrong information – you now have one source of contract information. People are working off the same page. In fact, in a second people can get an instant Contract Brief with real time information.
4. Reduce the chance of things falling through the cracks – along with one source of information you have one source of the work that needs to be done. The system even has a feature called My Work that brings everything that someone needs to work on to them. Visibility closes cracks.
5. Missing contract deliverable requirements – the system has a robust system to track contract deliverables and streamline getting the work done
6. Getting out of compliance – you can track FAR/DFAR clauses, provisions, deliverables (CDRLs). And, you can easily find the relevant contracts when things change and drive change system-wide in one step.
7. Not ready for audits – having a formal system helps you perform better to put you in a better position for an audit. And, when an audit comes the system provides everything you need.
8. Missing deadlines – you don’t want miss important time sensitive events. The system becomes your extra hands. It sends off email alerts and presents upcoming dates dashboards/calendars/reports to provide visibility.

Increased Effectiveness

With our system you now have all of your information in one place. People can begin to collaborate, and, they can get used to working together in a single system. In addition, our system is a full work management system. It automates and streamlines work. These capabilities increase productivity. But, the greatest driver of effectiveness is the elimination of silos, roadblocks and administrative “noise” – this enables people to focus on the work that matters.

1. Controlled Access to Information – this also drives effectiveness. To reduce risk, many organizations with a manual approach restrict access. They therefore require requests to be funneled through people in the contracts department. This negatively impacts peoples effectiveness. R3 provides you with appropriate controlled access. People have the appropriate, real time information at their fingertips and are more effective.
2. Instant, Accurate, Single Source Information – it is not effective for people to have to ask for information, have someone research and prepare it and then use it. With our system any people get that information in real time. It is the same information for all people at the same time. A good example is our instant Contract Briefs. One click to get the full, current story about a contract.
3. Accessing Customer and Subcontractor master data – the master databases for customer, subcontractor and contact information are often spread across an organization. Our system allows you to centralize this information as Master Data and make it accessible and reusable through the system and your organization.
4. Following consistent work processes – you can increase effectiveness by having your organization follow consistent processes. Our system allows you to set up processes. It streamlines and automates the work. An example is the New Customer Contract process. You set up your process and the system takes care of moving it along and making sure that all of the information is available to each participant to do their part.
5. One system – many organizations manage contracts using many tools. They might use Excel for tracking, CRMs for people data, 10 custom databases, file shares for documents or Google Drive or SharePoint, lots of email and multiple workflow tools. All of these are part of our system. You can consolidate these tools. This makes it easier for your people.
6. Analytic Reports like Contract Waterfalls – people need good information to be effective. However, with the manual work required to pull together information and do analysis this means that the right information is typically not timely which means that it may not be accurate. With our system, you can get instant reports like a Contract Waterfall that shows you your portfolio of contracts with contract revenue spread out over the period of performance. The system will do the analytics in the background so people don’t have to.
7. Driving the Work – fundamentally, R3 is a work management system. This means that you use it to assign work and track that things that need to get done, are getting done. In GovCon, for instance, Contract Deliverables are a major compliance issue. Our system can drive the work as follows:
   • you document the Contract Deliverable Requirements
   • you create Actions Items into the future for the Deliverables (such as “spawning” 60 Monthly Reports using our Recurring Action Item feature)
   • and then, when the time comes, you manage the work for each Contract Deliverable Action Item. R3 Action Items are like little virtual folders that can hold multiple documents, track activity and be routed, reviewed and processed.
8. Effectiveness across Departments of Work – silos are constraints to organizational effectiveness. Contracts in GovCon is a “team sport” that crosses departments. With our system BD/Sales/Capture/Proposal people can access Subcontractor information, make requests for NDAs or Teaming Agreements, track the progress and participate. Or, Program Managers can use the system to instantly get a Contract Brief or to manage the Contract Deliverables that need doing. It is not just a system for Contract Department effectiveness – it drives organizational effectiveness.
9. Just the right reporting – R3 is an open system. It starts with reporting tools that are configurable by business users. It also has advanced reporting and an API enabling organizations to create very custom, advanced way of looking at information and/or combining it with information from other systems such as your financial system. It can also be accessed and used with third party reporting tools such as SQL Reporting Services.

Cost Savings

When you adopt a formal system such as R3 Contract Management, you gain productivity through time savings. These systems eliminate the manual work, the duplication, the admin tasks, the “noise”, the searching for information across multiple tools and systems. This saved time can be correlated into cost savings.

You can work through this yourself using our Productivity ROI Calculator for GovCon Contract Management. It is an Excel spreadsheet that gives you a model of GovCon contract work. Our model does three things:

• It lays out the core tasks that GovCons do on Customer Contracts and Subcontracts and the estimated time people work on these Tasks.
• Second, it estimates what % of time our solution will save for you on these tasks. It also tells you how it saves time.
• Third, you see how all of the work tasks add up to total hours of work and what the ROI can be for investing in the R3 system.

There is another article, ROI Calculator for R3 Contract Management System for GovCon, that has the link to download the ROI Calculator and walks you through how to use it. It will help you to work through the tasks, the hours, the potential savings. It will end up showing you how many total hours go into contract work.

In our ROI Calculator we provide a model that is already filled out based upon our customer experience and best practices. You can start with that and go from there. For instance, below is a screenshot of some default tasks and their estimated hours for a customer contract.

Evaluating the Benefits and the Cost

The benefits of Reduced Risks and Increased Effectiveness are the business drivers of why GovCons shift to formal contract management systems. The Cost Savings is really what it costs you to get the benefits. If you come up with bottom line savings using our model then you are saying that the cost to move to a formal system is less than nothing. However, note that often you are really avoiding the cost of adding another person vs. actually cutting costs.

For more information on R3 Contract Management for GovCon visit our product page.