Almost every organization, public or private, needs procurement of goods and/or services for its existence. Such needs are to be received from external sources, or from sister companies, and whoever it is, are to be procured on the basis of agreements made which contain terms & conditions for the supplies, payment terms, delivery terms .. etc. Thus, it can be said that contracts are a vital part of any business transaction in an organization.
Contracts can be in many forms as relevant for its use such as; Employment, agencies, construction, import/export, insurance, leasing & renting which can be made for public, private or personal uses. Contract management involves management of the process of creation, review, control, execution and analysis of the contracts in order to safeguard, avoid risks, and losses thereby optimizing the performance of an organization. In order for the organizations meet tough competition and to be sustainable they have to find ways of cutting costs and find innovative ways to be efficient. Contract Management takes the burden of getting it right of all contractual processes thereby developing healthy business relations among its stakeholders. Absence or poor contract management not only risks the organization’s healthy business but also makes it financially vulnerable risking its closure or bankruptcy.