While private businesses are profit driven, governments are service driven.
This is the defining difference between the work goals of local governments or government agencies and private companies. So how can a Contract Management solution help a local council or government agency fulfill its mandate to serve the community? Here are a few reasons worth considering.
Service delivery responsibilities
Although not focussed on satisfying shareholders with ever-increasing profits, local governments still need to run a tight ship given that they are dealing with public funds.
Councils have a duty to deliver a wide variety of services, as well as run their town or city smoothly, and this can mean a potentially overwhelming number of contracts to manage. Contract Management software is a vital tool to help them navigate the hazards of numerous contracts and to help boost proficiency in all areas. By hanging on to old databases and manual systems, councils and government agencies are doing themselves and the public a disservice.
In addition, the quality of service delivery is greatly enhanced by having a robust CMS. It forces the council to clarify its needs and stokes competition among the bidders, which results in better contractor options. Everyone’s game is lifted to a higher level.
To curb corruption and fraud
“The worst disease in the world today is corruption.
And there is a cure: transparency.” Bono, U2
In an eye-opening investigation done by the World Bank Group Enterprises Survey, the percent of firms expected to give gifts to secure a government contract is 27.4% across 139 countries researched, going up to 45.5% in East Asia and Pacific, the most corrupt region surveyed.
Councils and government agencies are answerable to the tax-paying community. A good Contract Management solution will ensure a transparent audit trail so that an account can be given to the public on how their money was spent.
It will also have built-in business rules to ensure compliance with legal obligations. Councils and government agencies work under strict codes and any CMS worth its salt will have systems to vigilantly guard against dishonesty and fraud, as well as guarantee probity. The legal implications of a slack Contracts Management system can be disastrous.
Procedures, policies and record keeping need to be vigorous to ward off any temptations amongst those employees vulnerable to corruption.
Fair and open tender processes
By using an electronic tendering process integrated with a Contract Management solution, government contracts can be evaluated and awarded on a fair basis. Favouritism, undue influence and bribery are curtailed if a consistent evaluation process is managed by the system.
Budget management and spending visibility
Most councils work within a limited budget and therefore any sloppiness in managing contracts, such as missed deadlines, incur unbudgeted costs. A good CMS will help track spending and optimise resources.
Contract performance monitoring and risk mitigation
An integrated CMS across all departments goes a long way towards mitigating risks as it increases visibility and control. Bumbling along with a manual process does the opposite – it is rife with risks. It also enables a council to manage contractor performance and quality of work, as it sets out clear expectations, budgets, time-frames and outcomes.
A tool for better leadership
With the reporting tools that a Contract Management platform provides, local government managers can make informed decisions with measurable data. This comprehensive reporting will help decision-makers plot a course to better future performance.
Benefits of Business Process Automation and data security
Automated business processes are the key features of a CMS. They provide a wealth of useful functions such as automated sign-offs, workflow, digital task assignment, mile-stone monitoring, real-time information, invoicing and so much more. These features are crucial to efficiently manage contracts and make the whole lifecycle faster. Communication between all parties is greatly improved and all players across departments are kept in the loop at all times. Mistakes in Contract Management processes are also drastically reduced.
Is government Contract Management Software different?
Since local governments and government agencies have varying needs, they often need a Contract Management solution that is fitted to their unique way of operating. This is where custom software solutions come in to play as off-the-shelf options tend to be too inflexible (or expensive) to cater for their requirements.
By Jeannie De Vynck