The performance of a contract should only be managed by staff with the appropriate level of skill and experience. For more complex contracts or those that represent a higher risk to the University it is advisable to explicitly nominate an individual to act as contract manager.
d) Understand the contract
When you take responsibility for managing a contract, read it (this includes the specification, supplier’s proposal, key performance indicators, milestones and terms and conditions) and ensure you understand its provisions, particularly those relevant to the practical management of the work under the contract, such as reporting requirements, deliverables (including any testing and acceptance procedures), governance, the payment schedule, confidentiality, dispute resolution, liability, termination and insurance. The contract should be a key tool in managing supplier performance and the delivery of value for money, rather than a document referred to only when there are performance issues. The University Purchasing Department can explain the provisions of the contract if you require assistance.
e) Additional or amended work
You should not permit a supplier to undertake any additional or amended work, free of charge or otherwise, until a formal contract amendment is executed. A formal contract amendment ensures the appropriate terms and conditions are secured, reduces the likelihood of later dispute and ensures that the scope, deliverables and price are clear and meet the department's needs. Processes will be set out in the contract for dealing with changes, including who needs to approve the change. Templates for requesting and executing changes may also be included in the contract; if not an amendment template is available. Contract amendments should be signed by an individual in the department with an appropriate contractual delegate (see (a) above). Records should be kept of all contract amendments and stored with the original contract. If you are unsure, please seek advice from the Purchasing Department.
f) Supplier performance
You should manage the supplier’s performance in accordance with the standards set out in the contract (for example any key performance indicators or service levels). Even if these standards are not specific, the supplier should perform the services to a reasonable standard. You must therefore ensure you are familiar with the performance standards in the contract and keep a record of the supplier’s performance against these standards. You should regularly review performance with the supplier and aim to give clear and evidenced feedback regarding performance to the supplier (both positive and negative). Where a supplier is responsible for reporting their own performance, consideration should be given to any available methods which might be used to validate the accuracy of the supplier’s reporting. Feedback should also be sought from users or stakeholders if they are able to provide insight into supplier performance.
g) Risk management
Both parties should have a clear understanding of the risks associated with delivery or performance of the contract and clear responsibilities should be identified as to who is best placed to manage these risks (with such information potentially being captured in a formal risk register). Risks should be subject to ongoing review and assessment.
h) Information security
Where a Third Party Security Assessment (TPSA) was completed as part of the procurement process, it is the responsibility of the person managing the contract to monitor the expiry date of the TPSA (information security policy dictates the TPSA will expire three years from the completion of the assessment). Where the TPSA expires during the term of the contract the supplier should be asked to update its original self-assessment and this should be re-checked by the Information Security Team (email: grc@infosec.ox.ac.uk). It should be noted that this process can take many weeks to complete, depending on the complexity of the service and co-operation of the supplier and therefore this activity needs to be planned for accordingly. If you are unsure of the expiry date of the TPSA you can check the current register at Information Security - Third Party Register - All Items (sharepoint.com). Full information on working with third parties can be found at Working with third parties | Information Security (ox.ac.uk).
You should also maintain awareness of any changes to international locations where University personal data is processed: International transfers of personal data | Compliance (ox.ac.uk).
i) Governance processes
Ensure your departmental/divisional internal escalation and reporting routes are in place for authorising contract change, reporting risks and dealing with poor performance issues or disputes at contract negotiation stage. If a dispute occurs, it should be resolved as quickly as possible through mutual agreement in line with the terms of the contract. Where this is not possible, the dispute should be escalated to the appropriate University department. For legal disputes this would need to be escalated to Legal Services. For contractual matters, to the Purchasing Department.
j) Contingency plans
Where appropriate, develop practical contingency plans to handle supplier failure (temporary or long-term failure/default).
k) Review & benchmarking
The contract should be regularly reviewed (with a view to updating it where necessary) to ensure it meets evolving business needs. Review meetings should aim to cover progress with agreed deliverables, or problems with the specification, or other risks such as time delays. For longer terms contracts consideration should be given to periodically benchmarking supplier’s prices and rates to ensure value for money continues to be delivered. Benchmarking guidance is available.
l) Acceptance and payment
You should not complete a goods receipt note (or any other document used to accept work) until the contracted work has been satisfactorily delivered to the standards set out in the contract (and confirmed in accordance with any defined acceptance tests). No payment should be made at any time if standards are not met by the supplier. The use of retention payments should be considered where delivery is required over a period of time to ensure the supplier continues to be motivated to deliver the remaining aspects of the contract.
The contract will specify the payment terms and invoice address that should be strictly observed. All invoices must be checked for completeness, compliance with the contractual payment schedule and other agreed terms and conditions, and confirm that the relevant payment ‘trigger’ has been met, for instance, the delivery and acceptance of a certain aspect of the contract. Formal (written) approval of this must be evidenced before payment can be approved.
m) Contract extension
Arrangements for any extension of the contract (both scope and time), any termination notice or any other related issues should be recorded and retained and must be sufficient to enable others to understand how the contract has been managed. You must ensure that any such extension or termination notices comply with the terms of the contract and are legally binding. Such extensions or notices should be signed by an individual in the department with an appropriate contractual delegate (see (a) above). The Purchasing Department can provide advice if required.
