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Is This A Good Time To Be A Contract Manager?

June 2, 2010

There is strong competition for business. There is a lot of uncertainty about existing contracts. In this environment, terms and conditions have the dual challenge of becoming simultaneously more creative and more protective.

The number of job openings for high-quality contracts and commercial management professionals has increased. Salary levels for these positions are down a little, but have remained robust. In general, contracts and commercial groups have not seen the attrition levels of some other functions.

However, there is no question that management is becoming far more demanding of its contracts / commercial staff. They want people with a strong commitment to success, people who can close deals or ensure their delivery. They demand creative thinkers who can make the difference between winning and losing business – because today, commercial creativity is a major source of competitive difference. At the same time, the business needs practitioners who can protect and defend margins and ensure trading relationships remain strong.

So I am observing great interest in new terms and conditions, in better ways to package business relationships. Issues like agility and flexibility, imaginative ways to address revenue recognition, new approaches to pricing and financing, change management, intellectual property, termination rights – these are examples of the subjects under fierce debate. The key driver for all of this is the need to operae within an acceptable economic framework – not just our own, but also that of our trading partner. Top commercial and contracts pr0fessionals are those who devise and manage mutually winning deals.

Over the next few years, market volatility will continue. Many companies will face regular renegotiation of their public sector contracts; this will flow into their sub-contractors. The President of Hitachi recently alluded to this challenge in an interview with the Financial Times. He also highlighted the increase in competition, both because of general cut-backs and due to new market entrants.  The IACCM message boards and mail boxes have been  filling with debates and questions that illustrate the major role that is being demanded of the contracts and commercial community.

So is it a good time to be a contract or commercial manager? The answer quite clearly is yes – but it is also a challenging time, where an increased contribution is expected and where results must become far more visible. Top performers will flourish.

In the past, the only way to become a ‘top performer’ was through a combination of the right personal skills (that won’t change), the right overall experience and (if you were lucky) some good mentoring. There was no structured community to provide advice, to answer questions. There was no structured training – just a few sporadic classess, or materials that focused on the more administrative aspects of contract management. There was no defined profile of the role, the required skills, or a professional certification. And today, this has changed – IACCM offers fast, practical routes to gain structured training, to validate skills, to become certified and to participate in a vibrant professional community.

So as the world becomes both more challenging and more rewarding for contracts and commercial managers, it is easy to understand why IACCM continues to add new members at a rate of more than 500 a month. Yet more evidence that this is indeed a good time to be a high performing and professionally well-connected contract or commercial manager.

One Comment
  1. Fantastic article. I’m a QAP and although we stuggle with decreasing outsourcing dollars for outsourced service/plant maintenance, the DoD is redirecting those funds towards R&D to bring new joint force capabilities. Additionally contracting services is a force multiplier, allowing DoD componante to send more boots downrange.

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