30. Whilst Contract Management focuses on the management of the contract once signed, the success of contract management activities are strongly determined by the plans and activities during tendering/contract award phase, in terms of both 'hard' outputs, such as the contract specification and contract terms and conditions, and, the type of relationship between customer and supplier. In this way, the tendering/contract award phase and the contract management phase should be seen as a continuum rather than distinct phases, with the success of contract management planned for from the start of the procurement process.
31. As the partnership between the public sector and private sector in a PFI contract is intended to be long term, it is also important that a strong relationship is built and maintained across all the parties involved - private sector, acquisition/contract management team, end users - with a clear understanding of each party's responsibilities together with recognition of the cultural differences across the parties. The desired outcome is to establish effective management of these relationships to achieve and secure long-term success.
32. Prior to the signature of the contract all acquisition projects shall have a plan (the "Contract Management Plan" or "CMP") that sets out the plan for the management of the contract, for use by commercial and project management staff, senior managers and those involved in the assurance and approval of the project.
33. Following the signature of the contract, or very soon afterwards, the contract management team should have a suite of documents (the "Operational Contract Management Manual" or "OCMM") for use by the Contract Management Team that sets out the instructions, policies, information, and guidance that govern the day-to-day management of the contract.
34. Key factors that contribute to an effective working relationship include:
• understanding of and respect for each party's point of view;
• shared knowledge and objectives;
• sound understanding of the contract and contractual documents;
• good flow of information and open channels of communication;
• a willingness to resolve issues across all parties;
• effective decision making processes; and
• desire for the project to succeed.
Relevant Government policy/guidance:
• MOD PFU Guidance Note - MOD Standard Project Agreement v1 for PFI Projects
• MOD PFU Guidance Note - Contract Management in PFI/PPP Projects
• HM Treasury: Standardisation of PFI contracts (SoPC) Version 4
• OGC Best Practice - How Major Service Contracts Can Go Wrong
• HMT Technical Note 6: How to Manage the Delivery of Long Term PFI Contracts
• HMT Operational Taskforce Note 1: Benchmarking & Market Testing Guidance
• HMT Operational Taskforce Note 2: Project Transition Guidance
• HMT Operational Taskforce Note 4: Contract Expiry Guidance
• OGC Best Practice - Managing partnering relationships
• OGC Best Practice - Forming partnering relationships with private sector in an uncertain world
• OGC Advice to Government Departments: Opinion Letters