Contracts are the core of every Federal Government Contractor. Yet, the majority of Federal Contractors have not implemented any type of a formal contract management system to track, manage, and monitor their contracts. Many have moved to electronic storage of their contracts, but still rely on file shares, email, spreadsheets, other assorted systems, and manual processes to manage the contracts.
This lack of structure, control, and visibility significantly increases the risk of missed contract requirements, milestones, and deliverables.
One 300-person defense contractor had a complex set of contracts to manage. They had long been a government reseller of advanced computer and communications equipment, so, they had transactional types of contracts through delivery orders. They also had a solutions business and had won multi-year prime contracts, and many associated subcontracts. They also dealt with all the contract artifacts, including teaming agreements, NDAs, and more.
The Challenge
This firm had moved from paper to electronic storage, but the contracts and information were still spread across the organization and all the work was still manual. It created significant access issues, massive inefficiencies and duplication of effort, and most of all, it created a high-level of risk for the organization because it did not have a handle on the contracts or the myriad of contract requirements.
Some of the specific issues included:
- Could not provide people outside the contracts department with direct access to many of the contracts, so people were constantly asking for information.
- Some of the contracts were managed by sales, with no control over the documents. They were open and accessible, and could be changed or even deleted. They were completely exposed.
- There was no way to get a real-time view of the status of any contract. Information was in multiple places and not generally accessible.
- There was no ability to look across contracts to find those that met certain criteria like having specific FAR clauses or Terms.
- Finally, all of the processes were manual. They were driven by emailing documents around. It was impossible to know what processes were occurring with what contracts across the contract landscape. Things fell through the cracks.
In effect, while their information was electronic, they were still in a manual, segregated work environment. This means that all work was driven manually, primarily through email. It means that there was no visibility into the work going on. And, it means the environment couldn’t do anything to help them drive or manage the actual work on contracts. They were stuck.
The firm realized the potential risk they were facing, as well as the time and dollars lost to all the inefficiencies. They realized they needed to upgrade their way of working to a formal contract management system. They needed a single central repository. They needed controlled access by users across the organization. They needed visibility into each contract and all its associated information and documents. And they needed process automation. They needed the ability to actually see all the contract requirements in one place, manage the contract work, and drive processes and the workflow.
Over the years they had evaluated multiple off-the-shelf contract management systems, but they were all designed to support organizations selling to commercial organizations. The needs of Federal Government Contractors are different. The costs and risks of trying to convert these systems to meet their needs were too great.
The Solution
They finally found their solution—R3’s Contract Management for GovCon. The solution is based on a rich set of contract management features that are designed to specifically support the business of Federal Contractors. With the solution, companies are able to quickly add organization, structure, and control to all their contracts and the associated artifacts. This significantly reduces contract risk and increases efficiency and productivity.
Some of the specific benefits the company realized with R3’s Contract Management for GovCon are discussed below.
One Full View of a GovCon Contract
GovCon contracts have a lot of information that can grow and change over time. The R3 solution provides a single view of a contract that brings together the core data and documents of a contract. It also brings to the user the related information such as Contract Modifications, CLINs, FAR clauses, Customer and Subcontractor master data, Subcontracts, and Contract Deliverables. All of this information can be necessary to get a full picture of a GovCon Prime contract.
Controlled Access
When using Microsoft SharePoint, other document management systems, or file shares, organizations are constantly battling the issue of whether to provide users with direct access or not. It is usually binary, full access or no access. This is just not a good situation to be in.
The R3 Solution enables an organization to provide users across the organization with “controlled access” to contract information. Users are only able to see contract information and take actions on contracts based upon their role. So, while there is direct access, you have control. This gives you very fine grain control, such as just allowing certain people in a particular role to say change certain dates.
Pillars of Contract Work
This customer needs to work with quite different types of contracts, like most Federal Government Contractors. They have Prime Solution contracts that are very involved. They have Subcontracts that relate to Prime contracts but are separate. And, they have Delivery Orders that are more high-volume, simpler and transactional.
The R3 solution allows organizations to optimize different types of contract work. It does this by providing separate “Pillars” for key types of contract work. Each Pillar can have its own information, different processes and workflows, and different user actions and permissions based upon the role of the user. So, the work can be optimized. Yet, they are all part of one system that can be searched, used and managed as one.
Visible Processes
The R3 solution enables you to drive streamlined and automated contract processes. You set them up and the system drives the work. You can have different workflows for different contract processes. And, you have lots of process visibility. You can see all of the contracts that are in process. When you are called upon to do your work in a process you have all of the information and tools at your fingertips to make intelligent decisions and get the word done.
Takeaway
Many Federal Government Contractors are stuck in this same situation as this company. They may have electronic storage of their contracts, but the information is still spread across the organization, open to anyone (if you can find it), and managed in an unstructured, ad-hoc way. It’s wasteful, unproductive, and carries increased risks of things falling through the cracks.
The benefits of moving to a formal contract management system are clear. The problem is that most contract management systems are designed for companies selling to commercial organizations and managing vendor purchasing contracts. With the R3 Contract Management solution you have an option to move up to the better way of working that is specifically designed for Federal Government Contractors.
Click here for more information on R3’s Contract Management solution.
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