Introduction | What's New in Version 5.5 | International Recognition
About the Author | Sources and References
Content Index | Order Your V5.5 Copy Here!

Contending, in negotiating - to - Contract Dates

prev

next

Contending, in negotiating

An effort to persuade the other side to make a proposal more favorable to you but less favorable to them. [D02731]

Content

All that is included, or contained. [D02533]

Content Type

The subdivision of contents into separate groupings or types. [D02534]

Context

The background within which something is reviewed, determined, decided, or otherwise happens. [D02535]

Contingencies

Specific provision(s) to mitigate random or unknown project risks from causing project failure or frequent baseline changes. [D04320]

See Reserve and Contingency Planning. [D00301]

Specific provision for unforeseeable elements of cost within the defined project scope; particularly important where previous experience relating estimates and actual costs has shown that unforeseeable events which will increase costs are likely to occur. If an allowance for escalation is included in the contingency it should be a separate item, determined to fit expected escalation conditions for the project. [D00302]

Contingency

As a result of risk analysis sums of money or amounts of time may be set aside as contingency which may be used in the event of risks occurring.
Editor's Note: Contingency should be shown in the plan as a separate item and not hidden in activities as "an extra 10%" on duration or cost. [D03817]

A Contingency is the planned allotment of time and cost for unforeseeable elements with a project. Including contingencies will increase the confidence of the overall project. [D00303]

An amount of design margin, time, or money inserted into the corresponding plan as a safety factor to accommodate unexpected and presently unknown occurrences that judgment suggests will occur during the project. [D00304]

Incidental expense. [D00305]

A component of the authorized appropriation or estimated cost at completion for the projectês scope of work or a particular cost class. Contingency is an estimator's allowance for the cost of unknowns, changes to make things work or estimating error. The anticipated award price of a cost class may also contain allowance for escalation. However, a reserve for scope changes is not a contingency in the same sense. A Scope Change Reserve is an allowance from which transfers can be made into specific cost classes when the scope of work in the class is amended by the owner. The appropriation for that class should be amended accordingly following the transfer. [D00306]

Time, effort or money added to the project plan to compensate for uncertainty. [D02190]

Contingency Allowance

Specific provision to cover variations which may occur in the expected values of elements of cost or schedule, but not scope or quality.
Editor's Note: Contingency Allowance is not the same as Contingency Reserve. [D00308]

See Reserve. [D00307]

Specific provision for unforeseen elements of cost within the defined project scope: particularly important where previous experience relating estimates and actual costs has shown that unforeseen events which will increase costs are likely to occur. If an allowance for escalation is included in the contingency it should be as a separate item, determined to fit expected escalation conditions of the project. [D00309]

Contingency Budget Procedure

A formal approval process by which sums identified as budget contingency may be applied where needed.
Editor's Note: There is much controversy over the management of contingency sums, ranging from dipping into the "big pot" approach to the incremental allocation of money to activities based on their relative risks. Moreover, the reallocation of contingency money is frequently a bone of contention between management and accounting departments. [D02536]

Contingency Plan

A fallback position, or workaround in the event of an adverse occurrence, or risk event, on the project. [D02537]

A plan that identifies key assumptions beyond the project manager's control, and their probability of occurrence. The plan identifies alternative strategies for achieving project success. [D00310]

An alternative for action if things don't go as planned or if an expected result fails to materialize. [D00311]

Mitigation plan. Alternative course(s) of action devised to cope with project risks. See also Risk Plan. [D04576]

Contingency Planning

The development of a management plan that uses alternative strategies to ensure project success if specified risk events occur. [D00313]

The development of management plans to be invoked in the event of specified risk events. Examples include the provision and prudent management of a Contingency Allowance in the budget, the preparation of alternative schedule activity sequences, workarounds and emergency responses to reduce the impacts of particular risk events, and the evaluation of liabilities in the event of complete project shut down. [D00312]

Contingency Reserve

A provision held by the project sponsor for possible changes in project scope or quality. Scope and quality changes constitute changes in the project manager's mandate and will affect the project's cost and schedule.
Editor's Note: Note the distinction from Contingency Allowance. [D00315]

See Reserve. [D00314]

Continuous

Happening without a break, non-stop. [D02538]

Continuous Improvement

Constantly striving to make things better, which is a particular aim of a Quality Assurance Program [D02539]

Continuous Reporting

Reports available on-line from data that is entered in real time. [D02540]

Contract

A binding agreement to acquire goods and/or services in support of a project. [D00320]

A contract is a mutually binding agreement which obligates the seller to provide the specified product and obligates the buyer to pay for it. Contracts generally fall into one of three broad categories:

• Fixed price or lump sum contracts. This category of contract involves a fixed total price for a well-defined product. Fixed price contracts may also include incentives for meeting or exceeding selected project objectives such as schedule targets.
• Cost reimbursable contracts. This category of contract involves payment (reimbursement) to the contractor for its actual costs. Costs are usually classified as direct costs (costs incurred directly by the project such as salaries of project staff) and indirect costs (costs allocated to the project by the performing organization as a cost of doing business such as salaries for corporate executives). Indirect costs are usually calculated as a percentage of direct costs. Cost reimbursable contracts often include incentives for meeting or exceeding selected project objectives such as schedule targets or total cost.
• Unit price contracts. The contractor is paid a preset amount per unit of service (e.g., $70 per hour for professional services or $1.08 per cubic yard of earth removed) and the total value of the contract is a function of the quantities needed to complete the work.

[D00316]

A document containing the terms of an agreement. [D00317]

A mutually binding agreement in which the contractor is obligated to provide services or products and the buyer is obligated to provide payment for them. Contracts fall into three categories: fixed price, cost reimbursable or unit price. [D00318]

An agreement in law between the organization as owner, and a consultant (See Agreement) or a construction contractor. It is a commitment document. The term contract is used to refer to the document itself. Construction contracts are often classified and described by the terms of payment they contain: Stipulated Price or Lump Sum, Unit Price, Cost Plus, etc. [D00319]

An agreement between two or more legally competent parties, in the proper form, on a legal subject matter or purposes, for a legal consideration. [D02291]

A mutually binding legal relationship obligating the seller to furnish the supplies or services (including construction) and the buyer to pay for them. [D03476]

Contract Administration

Monitoring and control of performance, reviewing progress, making payments, recommending modifications and approving contractor's actions to ensure compliance with contractual terms during contract execution. [D00321]

Contract Administrator

An official who has the authority to negotiate, enter into, modify, and administer contracts. [D04044]

Contract Award

The signing and issuing of contract documents to a contractor. [D02292]

The final outcome of the acquisition process in which generally the contract is awarded to one prospective supplier, through acceptance of a final offer generally either by issuing a purchase order or the signing of a legally binding contract formalizing the terms under which the goods/services are to be supplied. [D00322]

Contract Award Ranking

Qualitative and/or quantitative determinations of prospective suppliers' bid/tender/ proposal/quotation relative to each other measured against a common base. [D00323]

Contract Breakdown

The breakdown of a contract into measurable packages, measurable activities such as units of work performed, or milestones verifiable by corresponding checklists. [D02541]

Contract Budget Base

The negotiated contract cost value plus the estimated value of authorized but unpriced work. [D00324]

Contract Change

An authorized modification to some terms of the contract. This may involved any of the following: A change in the volume or conditions of the work involved, the number of units to be produced, the quality of the work or units, the time for delivery, and/or the consequent cost involved. [D02542]

Any written change in the terms of a contract. [D03478]

Contract Change Notice

A written buyer notice, directing the contractor to make specific changes to the contractual effort. Cost and schedule impacts of the change must be negotiated. Also called Contract Change Order (CCO). [D04045]

Contract Change Order

See Contract Change Notice. [D04046]

Contract Closeout

Contract closeout activities which assure that the contractor has fulfilled all contractual obligations and has released all claims and liens in connection with work performed. [D00325]

Settlement of a contract. [D00326]

Contract Completion Date

The date established in the contract documents for the completion of all or specified portions of the work. This date may be expressed as a calendar date or a number of work days from the issuance of the Notice To Proceed. When time extensions are issued by the owner, this revised contract completion date is referred to as the Adjusted Contract Completion date. [D04951]

Contract Dates

The dates specified in the contract that impact the project plan. [D00327]