Published here June 2006.


Musings Index

Contract Selection for Infrastructure versus Software/Hardware

Interesting questions from visitors to this web site are always welcome as it makes us think about real problems in the real world. We try our best to give a useful answer though recipients should view the responses in the light of their own particular circumstances and exercise their own judgment. Here are two more questions, edited slightly for web presentation and clarity.

Outsourcing Management of Multiple Contracts

On 2/3/06, Imam M. wrote:

Dear Mr. Wideman, currently I am preparing an agreement to engage a project management consultant to coordinate and manage a complex highway upgrading project .The highway design consultant is already appointed and conceptual design is almost ready. The Managing Consultant (tender already awarded) has to coordinate and manage the works of several Consultants and Contractors working within the project area.

The main project is upgrading of a highway involving 3 underpasses and flyovers which entails diversion/laying of different utilities services in addition to integration of required accesses to other private developments on both sides of the highway, each of which have their own consultant and contractor already on site. This is the first project in [our location] to appoint a coordinating consultant.

I have a copy of your paper titled "Total Project Management of Complex Projects, Improving Performance with Modern Techniques". Your paper describes similar complex projects.

My question is what should I include in the agreement in order to avoid disputes at a later stage? I would like to tie in the Consultant services with a list of deliverables. Is there a typical list of deliverables for such a consultancy? Where can I get a copy of a Standard Project Coordination/Management Consultancy Agreement? I would greatly appreciate your assistance.

Thanking you.

Dear Imam:

If some of the contracts of the infrastructure program you have described have already been let, it is quite possible that you are already too late. The reason I say this is because any responsibility you give to your coordinating consultant must also be recognized and reflected in the contracts of those whom the Consultant must coordinate. Otherwise, there is no obligation on the part of those existing contractors to take any notice - and believe me, they will not unless you negotiate changes to those contracts. Why? Because the new management arrangement represents a change in the scope of their work.

You do not mention whether the work is being conducted under US-type contract conditions or European. If the latter, I believe that the most recent FIDIC contract document could provide you with some good guiding clauses around project management, if not in detail, certainly in principle. You can find information on these documents here:

Hope that helps, M.

Seeking a Contract Template for Software/Hardware Installations

On 2/3/06, Angie S. wrote:

Hi Max, I have been tasked with creating a contract template for an organization that sells and implements software/hardware and provides installation and training services. I have been perusing your website and in one of your slides you say there are standard contract document forms available. Can you point me in the correct direction to go and find them?

Thanks! Angie S.

Hi Angie:

You don't mention where you saw that comment on my web site, but I rather suspect that it refers to construction-type project contracts. I am not aware of any generally accepted or recognized contract documents relating to software/hardware type projects.

However, the principles of contracting are well established in whatever the project management domain might be. You can find a checklist of the things you need to consider in Parts IV and V of my series of articles entitled "Progressive Acquisition and the RUP". They are at these locations:

As an aside, many people in your situation turn to their local general practice lawyers to provide them with a suitable document. Not a good idea. Establishing contracts for projects is a specialized area of the law and, depending on the area of project management application, often involves special considerations. Not least of these is the need to establish an atmosphere of trust and cooperation in running the project. Unfortunately, our legal system assumes a lack of trust and consequently takes an adversarial position.

There are therefore, in my humble experience, not many general practice lawyers who really understand the preferred project environment. Consequently, they come up with a long and confrontational document based on common (or not so common) law, intellectual property and so on. In short, a document that essentially sows distrust between the parties before they even start.

If you can write plain, simple, English, you can probably come up with a far better and more wholesome document provided that you at least address all of the items I have listed, and correctly describe the intent agreed between the parties. But don't expect it to have the support of the average lawyer. That's because the object of your exercise is to ensure that the parties to the contract understand their respective contributions to a successful project, rather than to win an esoteric battle in court where everyone looses - except the lawyers!

Hope that helps,


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