The main types of risks in the performance of contracts, such as internal, market, economic, legal and ethical sourcing and performance-based risks

Formulate SMART targets for supplier performance and agree their application with suppliers and other stakeholders

The importance of defining contractual performance measures of key performance indicators (KPIs) to assess quality, performance, cost management, resources and delivery

Define and agree processes to monitor contractual KPIs to assess quality performance, cost management, resources and delivery with suppliers and stakeholders

The importance of analysing outcomes of negotiation activities completed with the suppliers of goods and services

Compare planned outcomes for negotiations with suppliers with actual outcomes and evaluate the reasons for any differences

How to assess contractual risks

Liaise with suppliers and other stakeholders to assess risk, complete risk registers and agree actions to mitigate risks

The use of data that relate to the performance and under performance of contracts

Collate and evaluate data on the performance of contracts and take actions to remedy or prevent underperformance

The use of audits to verify performance and costs

Conduct audits with suppliers to verify performance and costs, and take actions to remedy any queries from the information and data gained