Governments are increasingly choosing to invest in major projects, mega projects and giga projects. This was true before the pandemic and is even more true today as governments seek to encourage economic growth while delivering much needed infrastructure to the communities that they serve.
When looking at the prioritisation and restarting of active projects following the pandemic, the International Monetary Fund (IMF) has argued for a well-coordinated system for actively monitoring projects, differentiated by project size, complexity, and stage (see IMF, “Fiscal Monitor: Policies for the Recovery, October 2020“, Chapter 2, Page 37 (accessible here)). This differentiation is critical because the size, value and scale of mega projects inevitably creates a myriad of additional complex issues that must be overcome if these projects are to be successfully delivered.
This post looks at this complexity from a contract management perspective, and how technology will serve to overcome these challenges.
The challenge of managing contracts on mega projects
The challenges that parties face when managing contracts on mega projects are many and varied. The top three however would arguably comprise the following:
- Contracts are continuing to become ever more complex.
- Teams operate in silos which in turn makes capturing and sharing knowledge next to impossible.
- Businesses and contracting parties are using a myriad of tools, each serving different needs, and few providing the ability to connect with one another.
Throwing people at the problem is not a solution. The reality is that there is a downward pressure on resources, and even in circumstances where money is no obstacle, you would be hard pressed to find anyone who would argue against the notion that technology should always be adopted in place of people where technology can perform the same function better and faster. People should always be reserved to work on those areas where technology has yet to catch up.
The above highlights one key take away: having a good technology stack is a precondition to enabling best practice contract management. Project participants that fall short and/or under invest in this area will fail, and smaller, agile, tech savy companies will win the day.
The contract management-project management tech intersect
Contracts represent the core of any major project. Treat them with the respect that they deserve and convert them into an Intelligent Document Format (IDF) to allow your business to eliminate document complexity, enjoy auditable compliance and remove the silos that exist between teams, projects and where appropriate, parties. Build your internal processes and corporate knowledge into the documents and instantly enjoy best practice contract management.
From there, the focus needs to be on adopting best of breed tools in a fully integrated manner. As McKinsey puts it:
“The construction technology ecosystem is shifting toward integrated software platforms that better serve customer needs”. (Access full article here)
An example of what this looks like in practice is the Affinitext-Scenario Cloud solution, where deliverables such as defects reporting and/or notice requirements are flagged, work-flowed and actioned against the relevant clauses of the contract. Data guides decisions and the reasons for decisions are captured for future reference against the applicable clauses.
Conclusion
While mega projects are often born through visionary thinking (look no further than The Line in NEOM), they will only live up to the hype if the participants on these projects adopt best of breed technologies to overcome the complexity that these projects inevitably comprise.
If you are interested in what’s next for contract management and how technology can help your company with these challenges on your large project, please request a demonstration here – https://www.affinitext.com/request-a-demo/
We would be happy to chat about the possibilities!