Contract Management ‘writ large’

“Contract management will be writ large in terms of where we put our focus in the public sector”.

These are the words of Sally Collier, Deputy CPO for the UK Government, when she spoke at the Scottish Government Procurement Conference last week. Sally was one of many speakers who highlighted the increasing role of contract and commercial management in ensuring delivery of value and successful policy objectives.

As this blog has highlighted on many occasions, this growing focus is not unique to the public sector. Organizations generally are grasping the need to improve alignment on scope, to ensure that governance and performance criteria are effective and to select trading partners who can support successful outcomes. This is achieved through contract and commercial disciplines.

Recent publicity over contract management practices has probably accelerated interest in improvements. Next month, the CEOs of three large companies – Serco, Capita and G4S – will appear before the UK Public Accounts Select Committee to explain charges of large-scale over-charging on Government contracts. The incidents have already led to two high profile resignations, plus extensive internal re-organizations (see here and here). But I am sure Government ministers also recognize that failures are to some extent due to poor contracts and weak governance procedures with the public sector.

IACCM research shows that similar problems apply across most industries. Commercial and contracting skills and capabilities have largely been ignored in recent years, even though business complexity has steadily increased. Now they are very much on the agenda – but, as one delegate in Scotland opined, “Can we have any confidence that the skills we need to change this situation are actually available?”