Time and again resources that are negotiating and/or binding an organization in an agreement are clueless of the ramifications. Some strictly rely on the automated tools for determining document or redline changes without actually reading the contract. Some fall for the line of “we only use our contract- sorry it’s a deal breaker”. Some don’t even assess the big picture of the agreements impact as they are more concerned with purchasing the latest and greatest that will either make their job easier or put them ahead of the game in their industry. Is this due to unqualified resources working on such important responsibilities or confusion as to where a resource’s loyalty should be? It’s a combination of several factors but more so with the lack of training, appropriate resources and oversight. While we all know the basic minimum requirements of a contract (Offer, Acceptance, Legality of Purpose, Legal Capacity (Age, Mental capacity) and Exchange of Value, in this series of Contract Administration, there will be posts about strategic elements to successful contract administration.


Employees, contractors and agents thereof have a fiduciary duty to their employer or the organization for which they are acting. They are agents for the employer/organization and must act accordingly in the best interest/benefit for such. Yet, the utmost importance is for the resources to understand their duty to their employer or client when negotiating and managing their agreements.
High pressured sales reps and the drive for professional/personal success are some of the leading causes for a resource to ignore the red flags of a bad deal. Believe it or not even the best resources for one reason or another tend to fall for the most transparent sales tactics. It could be because of the pressure of fearing failure, losing the right vendor/supplier or even peer pressure of all the above. With our fast-paced advanced global market, it is difficult to stay on top of the ever-changing tools available or coming available to move an organization to the next level or expansion. Yet, they do not realize that may be this isn’t the best product/service or supplier for the job or project.

An effective contract administrator will identify the issues and risks, question such resources as to such, and provide the appropriate guidance. Here are some effective tools to use for those involved in the purchasing, negotiations and administration of agreements with respect to reminding them of their duty:

Training on:
o The practice on binding an organization
o The repercussions of binding an organization
o Common sales tactics
o Knowing your industry and market
o Knowing your supplier/vendor
o Legal requirements
• Controls:
o Auditing vendor to project/organization
o Continuing education and Testing on contract/market related issues