A company is anxious to sign a 3-year software operation contract for an ERP (Enterprise Resource Planning) software package. The company has already acquired experience in the provision of software operation services for the ERP package. The multinational organization suggests paying a lump sum for user support, corrective and adaptive maintenance tasks, and a separate payment for functional improvements, based on the characteristics of each request. The pressure from the Sales Department to immediately sign the contract left little time to prepare a proposal, and practically no time for a contract review. What risks are entailed by neglecting to hold a contract review?

A company is anxious to sign a 3-year software operation contract for an ERP (Enterprise Resource Planning) software package. The company has already acquired experience in the provision of software operation services for the ERP package. The multinational organization suggests paying a lump sum for user support, corrective and adaptive maintenance tasks, and a separate payment for functional improvements, based on the characteristics of each request. The pressure from the Sales Department to immediately sign the contract left little time to prepare a proposal, and practically no time for a contract review. What risks are entailed by neglecting to hold a contract review?

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.3SA

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The contract is signed at the end of the? A) pre-award phase B) post-award phase C) award phase D) award cycle
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We were doing a mooring system project for an offshore oil rig in the Gulf of Mexico. It was a fixed price contract, but the specifications were sprinkled with a lot of TBDs (to be determined) items. As the project manager, the TBDs required a lot of attention and caused tremendous headaches between the customer’s project manager and myself. I had to watch these TBDs like a hawk. When a TBD specification was finalized by the customer, I had to ensure that the clarified specification was doable and that it did not affect my project’s cost and time constraints.Out of a dozen TBD specifications, one was for the smoothness of a stainless steel surface. I had to negotiate this TBD specification rigorously with the customer’s project manager. I did not want to accept a tight specification that would have required extra fine machining of stainless steel surfaces of our system. We first agreed on the smoothness measurement technique and then the measurement sampling location and measurement…
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Mr Nzimande owns a store that supplies purified water. His business has been rather successful of lately due to the water shortages in Durban. Mr Nzimande has a brilliant idea to create customised bottles for events. He notices that his neighbour Mr Naidoo runs a graphic design and printing company. He approaches him with the business idea. Mr Naidoo is keen and proposes brilliant graphic designs for the water bottles. Mr Nzimande wants to ensure that there is a contract in place between both parties with clear terms that reflect both of their interests. Question Mr Nzimande is 18 years of age, he understands that one of the essentialia of a contract includes that parties must have the capacity to contract in law. He further understands offer and acceptance, so there is no need to elaborate on that aspect of contract law in this question. You are required to outline seven (7) further essentialia that is necessary to be satisfied in order for a contract to come into existence. In your…