Construction Contracts: Work practices and procedures through client's eye

The main objective of Contracts Department is to set guidelines for screening and shortlisting of suitable contractors for awarding contract of work.  In other words Contract department handles all the supply and apply works of construction field. Also contracts departments drafts contracts with general conditions and special conditions of contracts based on the tender document for various construction activities. Further the selection & performance evaluation of contractors and subcontractors is also in scope of contracts department.

Inter-Departmental Coordination of Contracts Department

Workflow of Contracts Department

Receiving Request -  The requests list for contractors from sites is been raised for  several construction activities. Usually this process is handled by contracts department independently at the start of project and as the project progress process is handled combinedly with site department.

Identifying Potential Contractors - It is the responsibility of Contracts department to  identify potential contractors as per scope of work as required by site execution team. Contracts department identify potential contractors through 4 major process as follows 

1. Existing & past sources who have performed well in past works with the organization.
2. Senior management sources.
3. Construction job directory.
4.  Monitoring & follow up with contractors working on similar project with competitors.

Scrutinize top 3 contractors - Once the list of contractors for specific scope is made contracts department scrutinize the top 3 contractors on predetermined parameters and past records of contractors performance.

Negotiation Meets -  Negotiation Meetings are organized with all top 3 scrutinized contractors to discuss the terms and conditions of contracts and create a win win situation for both.

Negotiation results with Comparison Sheet - Once the negotiation meetings are over with all 3 contractors a comparative sheet is prepared with determined parameters and ranking which ultimately helps to select the contractor for job.

Work Order Preparation -  Work order is prepared once the final contractors is selected. Work order includes all the general conditions and special conditions of contracts which were already discussed in negotiation meets. Mostly FIDIC standards are taken into consideration for preparing work orders.

Award & Approval of Work Order - In this stage the final award of work order is given with both parties approval and later fed into ERP system for further records.

Contractors Performance Monitoring -  It is in the scope of contracts department to monitor contractors performance at regular intervals. This performance reports helps contracts department to develop bond with high performance contractors by offering them new works in future and to blacklist low performance contractors.