What distinguishes commercial management from contract administration is that the former involves a more strategic approach to matters that normally would be treated formalistically. There is nothing intelligent or noble in strict abidance to the rules if such approach leads to losses or long-term failure.. Often, the success of a complex project rests entirely on the relationships with the supply chain.
Prudent and mature commercial management done by experienced industry insiders is an art that allows to minimise the frequency of commercial tensions or contentious arguments which is paramount to achieving specific commercial objectives. Commercial management does also assist in maximising the financial success of the project.
Another consideration for meeting commercial objectives, is a proactive approach to the project change management process, while adhering to the conditions set out the contract. Many major projects fall short in this area, whether it be inflated and unreasonable quotations with proper quantitative data, late delivery of quotations and impacted programmes resulting in time barring, programmes not showing reasonable mitigations or the client not fully understanding the impact of a change request when raising the change. In order to help mitigate commercial tensions or contentious arguments as a result of change, the aforementioned must be tackled and governed plus the senior commercial management leaders of all stakeholders must cultivate a harmonious approach, be engaged, work collaboratively and communicate effectively
At Viviad we have an outstanding track record of understanding the above dependencies and objectives, provide help with:
1. Better understanding of project estimates and cost, especially their accuracy;
2. Creation of bespoke procurement strategies to optimise margins and profits;
3. Smarter value engineering and improvement of project’s whole life cost;
4. Optimisation and monitoring of local and international supply chains in procurement and pre-contract stages (both contractors and suppliers);
5. Ongoing work valuation and payment strategies that justly increase margins;
6. Cashflow analysis and management that ensures financial stability and compliance.
7. Management of change and issuance of timely and accurate change quotations and impacted programmesCONTACT US