A contract manager controls contracts made with customers, vendors, partners, or employees. They negotiate the terms and conditions in contracts. Ensure compliance with the terms and conditions, document and agree on any changes, or amendments that may arise during its implementation or execution. Contract managers handle contracts like employment letters, purchase orders, sales invoices, and utility contracts.
Contract managers oversee projects performed in partnership between one organization and another. They are responsible for coordinating every aspect of the project. From viewing and approving contract terms to coordinating deadlines, supporting budget, and more. Contract managers work across many industries, including real estate development, healthcare, government agencies, and more. They typically begin their careers as a contract specialist and work their way up to a management role.
Contract managers often serve as the critical point of contact between a business, and third parties to ensure timely review and approval of any variations. They also provide recommendations, and negotiate directly with customer attorneys or purchasing staff, to craft a satisfactory final document for all parties. They streamline communication and monitor processes to ensure the success of an organization.
Contract Manager Job Description
Contract managers cover various industries from government to technology to company that has a large number of contracts. Regardless of the organization type, one consistency is that, contract managers are the primary individual responsible for creating, and managing all warranties organizations use. They maintain complete records on an entire procurement and contract administration process. Contract managers’ writes, evaluates, negotiates and execute various contracts covering a range of transaction. They maintain correspondence and documentation related to contracts. Generally, contract management involves a few key stages. There is the early stage or pre-award phase. The first stage involves all the work before giving someone a contract, whether a business or an employee. The intermediate step is when the process is awarded. This step includes all the paperwork to make the agreement final. Third, there’s the post-award stage. This stage involves a lot of contract management and maintenance.
Contract manager job description entails:
- Drafting and revising a variety of contracts with the customer
- Ensuring the organization’s internal contract documents are accurate and well maintained
- Meeting with customers to discuss both legal and business matters
- Providing advice and guidance to the different teams relating to contract generation
- Maintain excellent working relationships with clients to ensure their needs are met
- Creating, preparing, reviewing, and editing all contracts
- Providing support and advising new potential business opportunities
- Identifying opportunities to improve business processes and devise plans to implement these changes
Contract Manager skills
Contract managers respond to bids, proposals, and contract negotiations. They prepare requests for proposals for distribution to vendors. They analyze all requirements and provisions in contracts, including terms and conditions, to ensure compliance with all laws and regulations, and company policies and procedures. Nonetheless, contract managers ensure that contracts are executed under corporate guidelines. They research writing contracts, audit existing contracts and oversee contract modifications. The contract managers also train and supervise other contract professionals. They communicate contract implementations to subordinates, and maintain a computer database for its contract management system. Contract managers, therefore, need to have extensive skills and knowledge to execute these duties successfully.
The skills of a contract manager, according to Indeed, include:
- Effective communication, negotiation, and interpersonal skills
- Exceptional attention to details and talents for accuracy and precision
- Deep understanding of contracts, contracts governance, contractual language, and the contract lifecycle
- Critical thinking skills and the ability to research and understand legal and financial implications
- Superior reading, writing, and language skills
- Excellent understanding of the business or industry, its services, customer, and providers
Contract managers need to have a high level of concentration, creativity, and leadership, as well as good problem-solving skills. They also need to have extensive knowledge of computers and software.
Contract managers are the backbone of every organization. Their role is one of the most significant responsibilities for all business sizes. They assist in managing obligations effectively. A contract manager who effectively controls his/her contract directly impacts financial performance, relationship with third parties, and organizational reputation.
Contract Manager Salary
The average salary of a contract manager is $81,950, according to pay scale data. According to data from Indeed, the highest paid contract managers are from Fort Worth TX, with the average salary 22% higher than the average national salary. Washington, DC follows second, with the average wage 17% greater than the average national salary. New York State follows with the average salary 13% greater than the national average wage. Atlanta, GA, follows with the average salary 10% higher than the national average salary. The average salary of a contract manager depends on the kind of certification, experience level, and education level.
The average salary of a contract manager, according to Payscale data, is as follows:
Certifications for Contract Manager
The type of contract management certification a contract manager choose depends on several factors. Specific work experience and the type of career path also affect the decision to enter a particular program. The NCMA offers three different contract management certifications;
- NCMA Certified Commercial Contract Manager (CCCM)
- NCMA Certified Federal Contract Manager (CFCM)
- NCMA Certified Professional Contract Manager (CPCM)
- NAGC Certified Government Contractor (CGC)
To obtain CCM or CFCM certification, a contract manager must have at least a bachelor’s degree from a regionally accredited university, one year of work experience in contract management, and 80 hours of continuing professional background. Contract managers are also typically required to pass an exam on the relevant body of knowledge. They are also permitted to take the exam while still working toward education or work experience requirements. Contract managers who pass the exam, receive contract management certification as a CCCM or CFCM once they have attained the necessary work experience and continuing education credits. Contract managers with formal training have higher chances of passing the exam.
A contract manager who intends to apply for CPCM certification must have at least a bachelor’s degree from a regionally accredited institution. At least five years of relevant work experience, and a minimum of 120 hours of continuing professional education.
Obtaining a CPCM certification represents mastery of all aspects of contract management, governments and commercial sectors. Professionals with CCM certification generally work exclusively in the private sector. Those with CFCM or CGC credentials primarily deal with government contracts. Contract managers with CPCM are qualified to work in either field.
The certification’s purpose is to guarantee that a contract manager has all the necessary skills required to handle a task. The contract manager industry is growing very fast. Thus, many employers require their workers to obtain certification. The certification gives a competitive advantage, higher pay scale, job securities, and more job opportunities.
Masters Degree for Contract Manager
A master’s degree help contract managers develop the skills to manage international projects successfully. With growing global competition and increasingly complex regulatory structures, international contract managers make a major impact on an organization’s efficiency, and are in demand. The master’s program also provides contract managers with an understanding of both the people-related and technical requirements necessary to handle contracts efficiently.
A master’s program in Contract management, or any related field provides all the knowledge and understanding of contract management, that a contract manager uses without emphasizing economics and finance. It bases on leadership. This implies that everything a contract manager needs to know relating to business analytics, marketing, consulting, and communication will be directly applicable in any leadership setting. The master program in contract management is eighteen months. However, it can be as short as one year or as long as two years, depending on whether the contract manager takes full-time or part-time.
Contract Manager Career Requirements
The day-to-day roles and responsibilities of a contract manager vary depending on the organization, type and size of project, and location. Besides, contracts can vary in complexity and style and can include rental or sale agreements, purchase contracts, employment contracts, or contract proposals for business. These roles are vital and require an individual to have all the relevant skills to qualify for the position.
Qualification for a contract manager typically include:
- A bachelor’s degree in a business or financial management field, i.e., business law or business administration
- 2-3 years of contract related experience
- Attention to details and the ability to spot errors and inconsistencies
- Ability to work with a team at all levels of an organization
- Proven management and leadership skills
- Sufficient ability to negotiate and execute contracts
- Excellent reading and language comprehension skills
- Ability to effectively handle contract management tools and software
Contract Manager Tools and Software
Contract management tools are great assistance to contract managers to manage and organize their work efficiently. There are many types of software for project management. The contract management software has diminished the human efforts, and the machinery efficiency is increased to the extent that they handle work, timetables, schedules, documentation management proficiently.
Wrike is one of the best contract management software. It helps supervise several projects with their completion, accompanying quick turnaround to generate quality output. Wrike’s intelligent software enables contract managers to manage their work effortlessly in an adequate manner, helping them be organized. The other software is Monday. com. This software enables contract managers to manage work with vast teams. It avoids confusion in the teamwork by offering attractive, user-friendly designs. Keeping the team posted about all the progress and updates of the projects.
Contract managers also use Microsoft Project software, to schedule tasks and assignments and observe workloads, and time tracking processes. This software minimizes human efforts. The contract management software confines great features within itself. They help manage and schedule contract managers’ tasks and provide a system to manage every work neatly. They help eradicate human errors and hence contract managers give out quality work.
Role of a Contract Manager in Project management
Project management is similar to contract management. Each contract is a mini-project .it has unique goals, consumer resources, has a beginning and end date. Contract managers coordinate and plan relevant activities and documentation in a contract file throughout the process.
Contract managers monitor and document project performance. Depending on the organization and goods or services they have procured. They ensure the actions of the supplier and the organization are in line with the contractual responsibilities. That the contract is amended to reflect agreed changes in circumstances, and that any claim or dispute is resolved amicably according to the contract terms.
Contract managers analyze the terms and conditions of the prospective contract. Then develop a work breakdown structure that reflects both the technical and administrative aspects of contract performance. The contract manager and the procurement officer, agree on intermediate performance goals based on contract performance obligations. The intermediate goals enable the contract managers to measure progress, detect significant performance variance, take corrective action, and follow up.
Additionally, contract managers conduct a formal meeting with the supplier’s team, to discuss their understanding and joint administration of the contract. They lead the sales team in reviewing the contract terms and conditions, and other vital elements, and explain the requirements. They update the project plan with the involvement of both parties, to reflect the actual date of effectiveness. The milestones/deliverables of the contract and any changes that may have occurred since planned.
The contract managers review the assessment plan with the suppliers. So that both parties know the basis of establishing contract performance. They discuss how and when to measure and report actual project performance. They ensure the techniques, timing, and frequency of measurement, and reporting reflect the work’s nature and criticality. The managers, additionally, clarify any remaining ambiguities and discuss procedures for managing change and resolving differences.
Contract managers make observations to collect information related to the aspect of performance. The information helps describe the progress of the work. They observe, gather information, and measure progress, to have a basis for comparing actual achievement with planned achievement to exert control. The steps contract managers take in project management are intended to ensure that parties work together to achieve the contract’s objectives. Thus, a contract manager must be alert, experienced, and equipped with problem-solving skills to successfully manage a project.