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Contract & Commercial Management - the seller side. Christian Sandbeck 20 nd October 2009. Agenda. Short introduction to CSC Contract & Commercial Management (“CCM”) A core function in CSC What defines best CCM practice? How CSC implements best CCM practice

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contract commercial management the seller side

Contract & Commercial Management - the seller side

Christian Sandbeck

20nd October 2009

agenda
Agenda
  • Short introduction to CSC
  • Contract & Commercial Management (“CCM”) A core function in CSC
  • What defines best CCM practice?
  • How CSC implements best CCM practice
  • Good and bad experiences with CCM
slide3

Short introduction to CSC

90.000 Employees worldwide introduced via outsourcing

92 Countries where CSC does business

3.346 Employees in Nordics

2.266 Employees in Denmark

5.200 bank-, finance og insurance companies use programs from CSC

100 % of CSC datacenters are ISO-compliant

contract commercial management a core function in csc
Contract & Commercial Management - A Core Function in CSC
  • Contract & Commercial Management (“CCM”):
    • Is a global organisation in its own right
    • Reports into the Corporate General Counsel
    • Regional leads reports into VP for CCM International business
    • Total of 425 Contracts professionals
    • Mandated by the Corporate CEO
    • Contracts that are complex and substantial in size have dedicated CCM support
    • Close co-operation with IACCM
contract commercial management a core function in csc1
Contract & Commercial Management - A Core Function in CSC

Commercial Management

Contract Management

Value

add

Contract Administration

contract commercial management a core function in csc2
Contract & Commercial Management - A Core Function in CSC

Commercial Management

Trusted Advisor

Contract Management

Value

add

Contract Administration

what defines best ccm practice
What defines best CCM practice?

“Contracting is less about words,and more about process” (but what is ‘the process?’

“Complete Visibility into those processes, and precise performance metrics are necessary conditions for managing contracting processes and contracted relationships”

Source: IACCM, Tim Cummins,

what defines best ccm practice1
What defines best CCM practice?
  • Research studies have furthermore indicated that best practice is defined by well defined processes for:
    • Effective relationship
    • Transition
    • Change Management
    • Performance management
    • Requirement definitions

Source: IACCM, Tim Cummins,

how csc implements best ccm practice
How CSC implements best CCM practice
  • CSC has implemented best CCM practice (visible processes) by the use of :
    • Governance structure,
    • Common process, systems and tools
    • Knowledge sharing/Communication

Which incorporates best practice as set on the previous pages…

how csc implements best ccm practice governance structure effective relationship
How CSC implements best CCM practice -Governance structure/Effective Relationship

Legal function

CCM

Account/

Finance

Service Delivery

how csc implements best ccm practice governance structure effective relationship1
How CSC implements best CCM practice -Governance structure/Effective Relationship
  • Well-defined career paths
    • To ensure that the highest level of professionalism is maintained, CSC has together with IACCM defined career paths

Vice President & General Counsel

Vice President

EMEA Contract & Commercial Management

Commercial Region Directors

Commercial Account Directors

Senior Commercial Managers

Commercial Managers

Contract Specialists

(plus junior Contract Specialists)

how csc implements best ccm practice common process systems and tools
How CSC implements best CCM practice Common process, systems and tools
  • CCM Contract handbook ensures that the foundation for contract management is established during the transition phase:
    • Contracts Administration Responsibilities
    • Contract Deliverables
    • Contracts Governance
    • Contract Interpretations & Issues
    • Escalated Issues & Disputes
    • Projects
    • Contract Modifications
    • Commercial Contracts Management Databases
    • Risk Authorizations and Authorizations to Proceed
how csc implements best ccm practice common process systems and tools1
How CSC implements best CCM practice Common process, systems and tools
    • Contract deliverables focuses on performance measurement and requirement definitions
    • Contract Compliance Matrix database ensures that the contractual baseline is established during the transition phase.
  • Automation of CSC and client obligations
  • The contract is broken down into:
    • CSC Obligations
    • Customer obligation
    • Billable items
    • Important contract information (e.g. Order of precedence)
    • Risk items (from the negotiation phase)
how csc implements best ccm practice common process systems and tools2
How CSC implements best CCM practice Common process, systems and tools
    • Contract Compliance Matrix (cont.):
  • Every CSC obligation in the contract have allocated an owner
    • Email address (used for notification purposes)
    • Description of obligations (laymen terms)
    • Due dates
    • Risk exposure
    • Contract Managers will ensure that each owner has a place to go for in case of question on the owners specific obligations
how csc implements best ccm practice common process systems and tools3
How CSC implements best CCM practice Common process, systems and tools
  • Common process, systems and tools
    • By using Contract Compliance Matrix database, CSC has a tool which enables:
      • Constantly monitor contracts with high criticality and complexity, broad scope, and longer duration to ensure they are delivering value as intended
      • Structured contract audit process which periodically reviews the health of each account against their objectives
      • Executive reports, regular review of performance and improvements; oversight of ‘troubled’ contracts
how csc implements best ccm practice common process systems and tools4
How CSC implements best CCM practice Common process, systems and tools
  • Common process, systems and tools
    • After transition, the contract manager monitors the contractual performance by subtracting reports e.g. :
    • Deliverables due in 30,60,90 days and overdue
    • Missed client obligations
  • Each owner gets mail notification in due time.
  • Overdues are escalated through the proper management chains
  • Obvious benefits:
    • Proactive
    • Ensures that the customer gets the contracted services -> Reduces breach situations
how csc implements best ccm practice common process systems and tools5
How CSC implements best CCM practice Common process, systems and tools
  • Common process, systems and tools
    • Contract Modification
  • To ensure that the contract is always current, the CCM handbook contains a process for contractual change management, which covers elements such as
    • Triggering events
    • Input
    • Execution steps
    • Process for updating the contract compliance database.
how csc implements best ccm practice knowledge sharing commuincation
How CSC implements best CCM practiceKnowledge sharing/commuincation
  • Knowledge sharing focuses on effective relationships
    • Subject matter experts (SMEs). E.g. experts within SLA/SLC, benchmarking, pricing models
    • Database with templates and checklists
    • In the transition phase CCM is responsible for ensuring that important contract information is conveyed to the Account Team, e.g.
      • Contract value
      • Flow downs to subcontractor
      • Unusual terms and conditions
      • Billable items
      • Etc, etc
  • Consistent communication(both internal and external)
    • Newslettersfor internal use, covering items such as new article on CCM, promotions, internal articles on lesson learnt
    • Account communication covers items such as substantial changes to the contracts, information about the Contract Compliance status
good and bad experience with ccm
Good and bad experience with CCM
  • Bad experiences
    • N/A
  • Good experiences with CCM
    • CCM has been engaged early in the negotiation phase(e.g. DD), to ensure that the intention of the contract is understood
    • Management of the contract has been considered in the negotiation phase. Not to many “to be agreed within 30 days after the Effective Date” please
    • The Customer has engaged professional Contract & Commercial Managers