Grappling with the world of contract governance

By Lilia Guan
In the public sector, at the local government level recording and notification of upcoming contract-related events is currently a manual process, prone to error and de-prioritisation.
Where suppliers’ invoices are lodged electronically into the accounts payable system, visibility of charges is typically lost.
Also there’s no formal mechanism to record incidents of service failures against the supplier and contract.
Financial service provider, Grosvenor Management Consulting’s managing director – Denis Henry told Government News it’s not uncommon for contracts and pricing to simply roll over as critical contract dates pass.
He said large enterprise solutions – like ERP and SAP systems – were costly, complex, challenging to implement and on long timeframes.
“What we are seeing and know to be true is government is highly scrutinised and governance has to be performed, all the t’s have to be crossed and the i’s have to be dotted,” Mr Henry said.
“We’ve had our own employees seconded into chief procurement positions and they’ve gone in and found a need for an enterprise contract system.”
To help lift contract governance in local government, Grosvenor has come up with a web-based contract management tool – based on a per contract per month subscription.
“It’s not meant to be the all singing, all dancing to get to Nirvana type of tool and is not just not another big ERP-type of system that costs time and money during the implementation phase," Mr Henry said.
“It’s a web based opportunity, where we have the servers and we’ll maintain that. The tool also has log-in systems and all of the hardware and
 software for disaster recovery will be managed on our end.”
Mr Henry said for local governments large enterprise systems are too expensive and their implementation too complex, but these procurement managers need something in place to keep governance on contracts.
“Gone are the days when procurement officers could manually log-in contract details through an Excel spreadsheet,” he said.
“Those that are still doing this have disconnected systems.”
Mr Henry said Grosvenor web-based tool is only sold on a per contract basis and not per user.
“The client pays $40 per contract, so they can have as many users viewing the contract details as they need,” he said.
Currently Grosvenor has three local government clients using the tool across New South Wales and Victoria.

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