Loading...
 
 

Losing money on your contracts?

Published: 20 Feb 2019 Average Rating: 0.5 / 5 Print
 

Author: Tim Cummins

Only 29% of organizations are actively monitoring the profitability of their contracts. That's just one of the findings in IACCM's latest benchmark research, which gathered data from 752 organizations.

Why is this not surprising? Well, for most, accurately associating costs with specific contracts is challenging, both in terms of collecting and consolidating the data. Given the amount spent on technology, it might appear that problems like this should have been overcome, but it really depends on the type of technology that has been implemented. For most of that 29%, I suspect that much of the analysis is based on standardized apportionments rather than detailed analysis.

Today's technology is mostly about efficiency

In the typical corporation, many of the tools and systems have been implemented to automate and streamline existing activities and processes. These are interesting because they reduce operational costs and potentially raise quality, but their design frequently results in incomplete or fragmented data flows. However, there are other tools and systems that deliver far greater value by offering previously unavailable insights and knowledge – data that is actionable and potentially transforms business.

Information breakdowns are typically most severe at the cross-over point between processes or organizations. When data meets boundaries, it frequently depends on manual support for its transmission, with the result that it often gets lost, corrupted, delayed or ignored – and this is clearly the case with something as complicated as cost and profitability data on contracts or customers.

Enabling relationships through business intelligence

Transformational technologies are typically those that cross traditional boundaries and I was therefore excited recently to speak with some of the revenue leakage experts at Pramata and gain insights to their system, which is designed to provide precisely the sort of intelligence needed to support sales decision-making and 'ease of doing business'. Pramata software equips an organization with real-time data on the overall performance and profitability of specific customers or clients, enabling resources to be targeted towards the best returns and to reduce value leakage.

By consolidating fragmented data, Pramata is equipping organizations to better manage the commercial relationship with their clients, whether dealing with new opportunities, billing, servicing existing contracts or planning renewals. It certainly appears to be filling a critical gap in business intelligence and supporting the IACCM mantra that contracts must be handled as key economic assets.

 
 
 

Related Discussions


Occidental Petroleum Corporation
2019-02-12 17:17:02

Cloud Contracting

I am interested in perspectives on various issues and contracting approaches for the use of cloud services, particularly from niche providers who may, in-turn, actuall...
 
 
 
Replies: 2
Anonymous
2020-03-11 05:47:57

FM Event - Foreseeability

Can someone please clarify for me: Australian Jurisdiction Where, in a FM clause, it defines an event which does not constitute Force Majeure as "any circumst...
 
 
 
 
Replies: 3

Marshall Denning
2019-06-12 10:55:59

8 payment schemes

Jacko mentions there are 8 different payment schemes - do we know which?
 
 
Replies: 1
Anonymous
2019-01-03 10:38:17

ADVICE NEEDED: difficult contract management position - customer & shareholder contracts

Hi, My company outsources key services to another company (Company X). However, we also own a portion of Company X as it was set up as a joint venture. I am the contr...
 
 
 
 
 
Replies: 4

Rogers Communications
2018-12-06 17:48:18

Source Code Escrow Type Protection for non-software

I am brainstorming ideas for a supplier contract where I want to ensure the technology and services to be provided by the supplier for resale to our end-customer over ...
 
 
 
Replies: 2
Anonymous
2018-01-06 22:53:15

Exception on a NDA

Hi everyone, I have, like Vladimir Koval, a question regarding the Non- Disclosure Agreement. Imagine the following situation: you have to issue a standardized Non-...
 
 
 
 
 
 
Replies: 5

Eureka Consulting, LLC
2020-08-27 11:25:55

Cross Cultural Communication

A Lesson in Cross Cultural Communication https://www.linkedin.com/pulse/lesson-cross-cultural-communication-iruka-a-ndubuizu-ll-m
 
 
Replies: 1

Clarivate
2020-07-29 23:12:10

Contract Forgery and other Fraud (Sell-side POV) - What preventive controls do you have in place and does your organization allow sellers to send contracts to customers directly for signature/review

Hello Folks: We have a number of processes in place to present various types of contract fraud for example customer forgery or side letters which we do not tolerate....
 
 
Replies: 1

University of Chicago
2020-06-25 19:09:34

Supplier's corporate culture

When you choose a supplier for mission critical parts do you care about its internal culture, if so what aspects of it and why, if not why not?
 
 
 
Older entries »
Replies: 2