Let's say you're an airline pilot walking onto your aircraft for your pre-flight check.  You walk into the cockpit and notice that there isn't an instrumental panel--just the flight controls, and no instruments.  How comfortable would you be as the pilot?

I came from a meeting today where FEMA and the Office of Inspector General were describing contracting issues relating to grants to businesses made during disasters.  One of the key findings was that purchasing departments in these businesses typically did not have a contract management / administration system.  Huh, What!?

Just like a pilot depending on his or her instruments for critical data to properly fly the aircraft, as purchasing purchasing professionals, you should be depending on your contract management system or "CMS" to properly do your job.  Don't have one?  Then you're flying blind...

How do you know when contracts are terminating and expiring?  How do you track contract amendments?  How do you justify your cost savings?  How do you monitor financial commitments?  How do you get your job done as a purchasing professional without a CMS?

The real question is, why don't you have a CMA?  If you think Excel is an acceptable substitute for a CMS, get with an industrialized nation, because it's not.  Is it because your boss is too cheap to pay for a CMS?  Show him or her this blog post.  You can buy a very robust (but not networked) CMS for less than $1,000.  If your boss says no to that, it's time to start looking for a real company to work for.

Convinced, have the money, but not sure what to buy?  Do what you do best  as a purchasing professional and RFP it.  What follows are example requirements to include in your RFP for a CMS.  Now you don't have any more excuses...

GENERAL REQUIREMENTS

Is the product "component-based," such as logically separated data records by vendor, contract, binder / dossier, location, individual, product, etc.?  If so, explain the various record types and describe how the record types are logically separate.

Describe the extent and level that the product is configurable by a user, including user defined fields and pick-lists.

Is the product procurement-specific or can it be used for the supply (sales) side as well? 

Is the product more oriented to a specific industry, such as government or insurance, or to a function, such as indirect or direct purchasing?

Specify the auditing / history features of the product.  Can users select certain fields to be audited or not?

For both system fields and user defined fields, describe the ability of the product to allow for user-specified field formatting and “required field” criteria (such as “not required,” “required,” “warn on no entry,” etc.).

Does the product include a workflow feature?  If so, describe.  Can data records be entered and maintained without invoking the workflow feature?

Does the product include a contract authoring feature?  If so, describe.  Can data records be entered and maintained without invoking the contract authoring feature?

Does the product require the use of templates or stylesheets?  If so, describe.

Does the product provide date- or event-based alerts?  If so, how are the alerts specified and how are the alerts made (e.g., via e-mail)?  Are the alerts specific to system fields or can a user create user defined fields that will allow for alerts?

How does the product link various records or data to other records (e.g., an exhibit to a master agreement)?  Is there a feature, such as a text node or a graphic, to illustrate parent / child hierarchies or other links?

Does the product integrate with other third-party software?  If so, list such software and the degree of integration with the product.

Can vendors externally access the product for bidding opportunities?  If so, describe the product’s vendor integration capabilities.

Describe the licensing models for the product, pricing, technical support, and maintenance costs.

Is there an ASP or hosted option?  If so, indicate the various options and prices.

Can an evaluation copy be downloaded or accessed?  If so, provide evaluation download / access instructions and indicate the trial period?

Describe any ancillary products to the contract management product (e.g., an RFx module).

VENDOR INFORMATION

Describe the product’s ability to tie a Vendor, Manufacturer, and Payee to a contract document record.  Explain how the product differentiates between the three parties.

Describe the ability of a user to specify attributes to a vendor record via user defined fields.

Explain how other records, such as individuals and locations, can be linked to a vendor record.

Explain the product’s ability for users to input and track vendor performance metrics.

Explain how scanned documents and other types of electronic files can be attached to a vendor record.

BUYER INFORMATION

Describe the extent to which the product allows for buyer information to be entered.

Does the product allow for cost data to be entered?  If so, describe and specify the fields.

PROCUREMENT DATA

Explain the product’s ability to specify a pick-list of products or services that can be linked to a contract record.

Indicate whether the product allows for product or services to be categorized at a higher-level data element (e.g., the products “Desktop PC” and “laptop” are members of the “Workstation” category).

FINANCIAL

Describe the ability of the product to capture the following data elements (including how / where captured) and provide reporting for the same:

Financial Commitments
Initial Cost
Final Cost
Savings
Unit / Extended (Cost)
Recurring Costs
Discount Structure
Volume Commitments
Contract Calculations (e.g., Automatic Period-over-period Cost Increases)
Cost Center Data

CONTRACT ATTRIBUTES

Explain the ability of the product to capture contracting milestones to be entered by a user (for example, “Intake,” “In Negotiation,” “Sent to Supplier for Execution).  Can these contracting milestones be selected from a pick-list?

Describe the functions of the product relating to contract status (e.g., “active,” “inactive,” “retired,” “terminated,” etc.).

How are contract numbers generated?  Can the format / content of contract numbers be varied by contract type?

Explain how the product allows for the specification of renewal types (e.g., annual, evergreen, etc.), terms, and notice / termination dates.

Describe the ability of a user to specify attributes to a contract record via user defined fields.

Explain how key contract terms and conditions can be “assigned” as attributes to a contract record.

Does the product allow for free-form notes for contract records?  What is the maximum text length?  Are there any formatting limitations?

Explain how scanned documents and other types of electronic files can be attached to a contract record.

REPORTING

Describe the capability of the product regarding ad hoc reporting, standard reports, free-form text-based searching.

TECHNICAL SPECIFICATIONS

What operating systems and databases can the product run on?  What is the recommended operating system / database combination?

Provide any other details regarding technical specifications of the product and technical requirements.