EME12 Contract Management

Contract Management

• Differentiate the types of contract.
• Describe the contents of contract.
• Master the stages in contract placement.
• Master contract management.

Types of contract

1. Bespoke system/off-the-shelf package/COTS.

2. Fixed price/Time & Materials/Fixed price per delivered unit.

   • Fixed price contract

   Advantages:
   - Known customer expenditure.
   - Supplier motivation.
   Disadvantages:
   - Higher prices to allow for contingency.
   - Difficulties in modifying requirements.
   - Upward pressure on the cost of changes.
   - Threat to system quality.

   • Time and materials contract

   Advantages:
   - Ease of changing requirements.
   - Lack of price pressure.
   Disadvantages:
   - Customer liability.
   - Lack of incentives for supplier

   • Fixed price per delivered unit contract

   Disadvantages:
   - Difficulties with software size measurement.
   - Changing requirements

3. Open/restricted/negotiated contract.

The another approach used in contractor(承包人) selection

• Open tendering process.
• Restricted tendering process.
• Negotiated procedure.

Stages in Contract Placement

• Requirements analysis
• Evaluation plan
• Invitation to tender
• Evaluation of proposals
  • Scrutiny(调查) of the proposal documents.
  • Interviewing suppliers’ representatives.
  • Demonstrations.
  • Site visits.
  • Practical tests.