Increasingly complex contracts and procurement structures often make it difficult to fully appreciate risk allocation and its implications. Prevention is better than cure. Late delivery, defects and cost overruns, damage to reputation, client relationships and the bottom line, can all be reduced or avoided through risk management. Unforeseen changes often occur to the design and scope which can cause further calls to increase investment. Risk management is a fundamental element of professional contract management. Unfortunately, it’s not often given the priority it deserves, which can lead to costly consequences. Research shows that contract risk management is a discipline that is difficult to consistently apply and maintain over the duration of a contract without the proper tools. This is especially difficult for contract managers who are responsible for managing a large number of complex contracts across multiple locations with multiple stakeholders.
The value of contracts is realised only after they're signed. Inadequate planning could not only lose out on benefits that your company has sought to secure, but it could also be exposed to new risks, including poor or perverse incentives, bad planning and demand management, ill-informed buying, deliberate contract manipulation, miscommunication, revenue leakage and cost overruns.
This PetroKnowledge Contract Risk Management and Mitigation Measures training course is intended to provide a good grounding in the essentials of contracts risk management arising out of construction contracts in an international context, using business English. It will include:
- A general overview of various contract risks and their mitigation measures
- An understanding of the role of managing risk within the fundamental principles of contract formation
- Identifying tools to manage and mitigate poorly defined or inappropriate contracting strategy
- Effective methods to ensure the contract delivers as expected
- Strategies to prevent the erosion of contract value