The Contractor Management Process Owner

Contractor Management Leadership: Your Process Owner

Do you have a person who owns your contractor management process? Nearly every organization has subject matter experts in various roles necessary to make the company run. Think about your payroll, maintenance, cyber security, or new hire onboarding. All of these functions likely have an official or unofficial process owner. Yet, many companies don't have an in-house expert to guide their contractor management.

In most high-risk industries, contractors play a pivotal role in the success of owners and prime contractors. An effective contractor management process is essential that contractors are well-managed. This article explores the role of the Contractor Management Process Owner (CMPO) and how to identify and support one.

What is a Contractor Management Process Owner?

First, let's define a process. A process is a structured and repeatable series of steps that achieve a business outcome.

Therefore, a process owner manages a process as an in-house expert. The process owner uses a combination of people, financial resources, and technical knowledge to run the process.

A Contractor Management Process Owner (CMPO) is a person who is responsible for developing and implementing a contractor management process for an organization.

Benefits

 Having a process owner has several benefits.

• The role helps to ensure that contractors are managed to meet the organization's objectives and requirements. This reduces the risk of non-compliance with the organization's standards.
• The role helps ensure all stakeholders know the contractor management process and responsibilities.
• The role helps ensure consistency in applying the standards and needed behaviors.

Responsibilities

The primary responsibility is ensuring the contractor management process is implemented and working effectively. This includes:

• Developing and implementing management standards that document each process step.
• Engaging stakeholders to ensure alignment with standards.
• Monitoring and evaluating the process.
• Optimizing the process (i.e. automated or semi-automated, electronic document management or email, single-stage prequalification or two-stage, etc.).
• Monitoring performance targets.

Attributes

The right combination of experience, knowledge, and training makes for a high-performing process owner. The primary attributes are:

• A good understanding of how the organization operates. Not just on the policy and procedure level but on the 'who gets stuff done' level. Knowing how needed support is gained and how a process is maintained in the long term is critical.
• A positive relationship with the process sponsor and other key stakeholders is essential to the ongoing success of the process.
• Understanding the legal and regulatory requirements for the organization's contractor management process. For example, if the contractors are highly regulated or represent unusual risk, the process owner needs awareness of the particulars.
• Good reference points for clients' needs so that the process is aligned to meet client expectations.
• Knowledge of the different types of contracts and their associated risks.
• Experience working with stakeholders, such as contractors, project management, field operations, procurement, quality, and other stakeholders, to ensure that their requirements are met.

Finding the Right Person

Identifying and appointing a CMPO can be a difficult task for organizations. The first step is to identify an individual well suited for the role. This individual should have the skill set and experience necessary to develop and implement the process. Additionally, they should have the interpersonal skills to work with different internal and external stakeholders.

Once the individual has been identified, a formal appointment by the organization legitimizes the role and the individual. The announcement is best made by the Process Sponsor or other sufficiently high-ranking leader.

Once selected, the individual needs the resources to manage the process effectively. This includes providing access to the organization's policies and procedures, face time with the Process Sponsor, and direct communications with other key stakeholders. A significant success factor for Process Owners is the quality of their relationships with the Sponsor and the day-to-day users of the process.

Developing the Role

Role development is the next critical step once the process owner has been identified and appointed. The role should include the responsibilities and duties necessary to administer the process effectively. Additionally, the function requires the authority to monitor and report on actions critical for implementation.

The role definition should also include the necessary training and resources for the  CMPO to thrive and deliver value. Ideally, the function will have accountability measures to ensure that they and the organization meet the objective of the contractor management standards.

Success Factors

Once the process owner is in place, these are the key strategies to help ensure their success:

• Charge to the process owner responsible for developing a plan for how the process will be implemented and managed. The resulting Contractor Management Standard defines the roles and responsibilities of each stakeholder that inputs to the process. The Standard includes the critical deliverables and reporting requirements for each stakeholder.
• Establish a roll-out and communication plan to ensure all stakeholders know their deliverables and reporting requirements.
• Develop a system for monitoring and evaluating the process to ensure it meets the organization's goals and objectives.
• Develop a method to health check and optimize the process over time. Optimizing the system for sustainability is a critical success factor.

Considerations for Small Organizations

The role of process owner is not typically a full-time job. It requires dedicated time at critical phases of development and implementation of the process. Still, it doesn't require daily dedicated effort in most cases.

Some organizations feel under resourced to justify a contractor management quarterback. Process owner responsibilities typically default to line managers and their support staff in these cases.

Typically project managers and field superintendents, purchasing, health and safety, and administrative staff pick up elements of the role. In these cases, it's essential for management to, at a minimum, document the actions needed to meet the legal and regulatory (contractor insurance and licensing, for example) requirements.

Distribute the criteria to stakeholders with contractor management responsibilities, then monitor performance. A periodic health check (i.e. annual) initiated by a senior leader is recommended to review the process and make adjustments. 

If you are a prime Contractor, your legal duties are higher for coordinating the work and the contractors. Therefore, your process needs to be robust enough to meet those obligations. This generally means more communication of requirements and tighter controls. Implementing a contractor management standard, with legal and regulatory minimums as its base, is a project management best practice.

Conclusion

Establishing a contractor management process owner is a best practice for prime and general contractors in high-risk industries. Your process owner is responsible for developing and implementing an effective contractor management standard and monitoring and evaluating the process to ensure it meets the organization's goals and objectives.

Finding the right person for the role can be a difficult task. However, by following the steps outlined in this article, organizations can identify an individual best suited to the role.

Additionally, organizations should ensure that they provide the process owner with the necessary resources and training to manage the contractor management process effectively and ensure that the role brings ongoing value to the organization.