Skip to content

Key Commercial Criteria

June 11, 2012

I received a question today from an IACCM member that i thought might be of wider interest – because it is the sort of thing we should know, yet not something i have previously encountered.

So the question is this: “We have an executive presentation coming up at the end of this week and I’m hoping you can help with some information we need to present.

Specifically, from an industry best practice perspective, what are the key criteria or issues a large company would expect its employees to be aware of for each phase of the sales contracting lifecycle. The phases we are using are:

a) Initiate

b) Pursuit (Bid and Contract Negotiations/Execution)

c) Service Management (Transition and run and maintain)

d) Completion (e.g. Unwind as a result of expiration or termination of a contract).”

They want to put forward 3 or 4 criteria that employees who are involved in the phase (either internal or external to the Contracts Department) should be aware of and adhere to.  As an example, in the Initiate phase, you might always check the credit rating and gather background information on the client, including any past performance with your company.

I will be assembling a list this week; i would welcome any input and will share the recommendations we come up with.

2 Comments
  1. John Jorgensen permalink

    a) Have an implementation mind-set…from the out-set.
    b) What relationship is desired? Ensure your governance is not boilerplated out of the last deal you did. There is no point having ‘Green SLA’s’ if your relationship is not right for both organisations.
    c) Ensure scope is very clearly defined, boundaries and acceptance criteria, and how that links to payment.

  2. Robert J. Hatfield permalink

    Sorry to just be seeing this query, but perhaps this thought might be of eventual utility:
    Either add a new first Phase -Evaluate -or include it as a prime 1st step under Initiate.
    The Evaluate action would include:
    – perform data-gathering/research on potential customer’s buying history for relevant service/commodity including contracting styles, established contracting vehicles/platforms, and partner-supplier relationships
    – obtain internal consensus views as to extent to which the sales “opportunity” corresponds with applicable company strategic plan and the anticipated closing date capacity to perform (i.e. re forecasted backlog)
    – feed above data into a good balance metrics Bid/No Bid decision-support tool
    – make at least a notional Bid/No Bid decision. If result is “Bid”, then perform periodic validations as new data emeges during proposal cycle – with readiness to reverse course if justified.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: