Solution

(Solution) CIPS Advanced Level Final Project Proposal

Selected Title

Improving Contract Management in Onshore and Offshore construction services in areas of project management, cost management, mechanical and electrical services by use of ADNOC Procurement Contracts Team and Contracts Application Systems

Aims and Objectives

• Reviewing of the contract management strategies in ADNOC Procurement Contracts Teams for identifying best strategies and opportunity to improve procurement construction services
• Reviewing the entire contract management plans
• Improving contract turnaround and reducing delays which contribute to costs overruns
• Coming up with recommendations to implement the procurement construction services and on the other hand supporting ADNOC broad category management strategy in their construction areas

Proposed Structure

ADNOC organisation implement Global Procurement Team (PCT) tasked with a role of making sure entire procurement contracts consistency with set standards, policies, guidelines and different policies. The different spend categories operate a specific PCT. Their mandate is to deliver consistent reviewing of the contracts and negotiation services for entire spend categories by applying contract management application and database managing their contracts, pursuing service level agreements (SLAs) and mastering the agreement. The contracts implementation by the process can be audited and multiple roles including reporting techniques, letters offered with suppliers and buyers notified.

There are three situations with contract being essential;

1. Costs of sourcing which are more than $100,000 as a minimum
2. Sourcing involving exercise of Intellectual Property (IP) deliverables
3. The suppliers requests to be offered with a written-based contract

In an event the contract is expected, purchase requisition ought to be highlighted with an approval sourced. After this, contract is offered to Procurement Contract Analyst for reviewing, analysis and negotiations for enhancing complying with ADNOC contracts legal and sourcing support. This is by liaising with suppliers and requesters in the entire phases to signing and suppliers management level.

The identified procedure is used in different spend categories in ADNOC apart from my spend category of interest which is the construction services (project management, cost management, mechanical and electricity). The overall construction spend amount in financial year 2022-2023 was AED500 Million. Hence, category manager for the construction services are tasked with increased reviewing of the contracts, implementing negotiations both commercially and legally and signatures. After the execution of the contract successfully, it is eventually shared to the ANOC Legal department to be approved.

The issue is that in the construction project consultancy category of spend, the category managers lack legal-based training or appropriate knowledge for effectively contributing to contract management.

Further, more weaknesses in the ADNOC arrangement identified include;

• Delayed successful turnaround leading to delayed project implementation and more costs incurred for the process implementation
• Poorly done negotiations and re-evaluation of suppliers teams contributing to inconsistency in ADNOC legal demands and comply with all legal and procurement requirements
• Ability to comply and liability characteristics owing to poor definition of assigned performance roles
• Inefficiencies in gaining approvals and to sign entire signing workflows

Methodology

Primary data sourcing using interview and also questionnaires

Sources of Information

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