For me one the most important things to get right when creating a contract is to clearly specify, based on organizational goals, the contract objectives and then the contract performance. Aligning these is vital to enable performance. Yet it is often forgotten because we want to buy or sell something. Without asking ourselves the bigger question. What do we want to achieve….
Organizational goals have two important elements. Realizing your vision / mission and do that in the boundaries of law / regulations. As businesses, organizations, and governments, it is important that we set clear objectives and goals to work towards. But how do we ensure that these objectives are translated into real-world results? One effective way is to translate them into contract objectives and actual contractual performance. Please look at the picture I used with this post, it is part of the CATS CM® framework.
By setting clear expectations in contracts and measuring performance against those expectations, we can ensure that all parties involved are accountable for delivering on the objectives that have been agreed upon. This approach is particularly relevant in complex projects or partnerships where multiple parties are involved and where there is a need for a shared understanding of goals and expectations.
To successfully translate organizational objectives into contract objectives and actual contractual performance, it is important to have a clear and detailed scope of work, a well-defined timeline, and measurable performance indicators. Performance should be monitored and evaluated regularly to ensure that all parties are on track and to identify any areas for improvement.
It is also important to foster open and honest communication between all parties involved. Contracts should be seen as a collaborative effort, and all parties should be willing to work together to achieve the desired outcomes.
Ultimately, when organizational objectives are translated into clear contract objectives and actual contractual performance, we can achieve greater accountability, clarity, and success in our projects and partnerships.
What are your thoughts on this approach? Have you had success in using contracts to achieve your organizational goals?
Arjen van Berkum
Arjen van Berkum is a columnist, keynote speaker and motivator, with an eye for business ecosystems, innovation and disruption. In addition to his work as technology and contract management evangelist, he is a visiting lecturer at Delft University of Technology (TU Delft).
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