Practitioner Corporate Award Assessment 2 Assessment Developing Contracts in Procurement and Supply


Using a set of your organisations (or one with which you are familiar) terms and conditions, explain how the terms and conditions help the organisation ensure that:
• The risks of poor quality, extension of time, increased costs and unethical practice are managed
• The relevant performance measures are monitored and managed.

Outline the concept of the “battle of the forms” and explain how you could ensure that any agreement is carried out under the organisation’s own terms and conditions.


Executive Summary

This assessment has focused on the Etihad Airways which is one of the most successful multinational entity in UAE. It has been demonstrated that its leading role in the Airline industry prompts it to establish ranks with entities of suppliers that offers them with goods and services required for their diverse operations in their industry of venture. The suppliers delivered to the company by their suppliers is critical as it determines the quality and value of the services they deliver to their subsequent clients. This was the rationale of evaluating the risks of poor quality, extension of time, increased costs and unethical practices which can be managed through an implementation of relevant performance measures which ought to be consistently monitored and managed. Notably, this report has delved on evaluating on the contractual relationship held by Etihad Airways which have enabled them to establish a plausible relationship with their suppliers.  Additionally, it has also focused on the risks of supplying poor quality goods and services to the company and the issues with increased costs. Besides, future best practice of terms and conditions that ought to be laid down by the company in their contracts for the purpose of keeping a good pace with their issuers linked to the inefficiencies of their suppliers has been identified. It has been recommended that Etihad Airways must channel resources in its litigation team to ensure that the process is not lengthy but timely and cheap. Through this, it would be possible to maintain a healthy commercial relationship with their suppliers. In addition, it is recommended that through the use of CIPS, the company can achieve in meditation and enabling the entities in keeping a constant control over any unforeseeable disputes prevailing in their operations. Hence, the terms and conditions in their agreements must be clearly stipulated in a way that all the stakeholders are conversant with the expectations from the company regarding their general practice.


1.0 Introduction. 4

2.0 Management of the Risks of Poor Quality. 5

2.1 Risk of Poor Quality in Contracting. 5

2.2 Strategies to Mitigate the Risks of Poor Quality. 6

2.3 Combating Extension of Time. 8

2.4 Management of Increase of Cost. 8

3.0 Mitigating Unethical Practices. 10

4.0 Monitoring and Management of Performance Measures. 11

4.1 Monitoring Performance Measures. 11

4.2 Management of Performance Measures. 11

4.4 Battle of Forms in Contracting. 12

5.0 Conclusion. 13

6.0 Recommendations. 14

References. 15

Bibliography. 16

1.0 Introduction

A contract is identified as a cornerstone in any business transaction. The issue of securing a supply of raw materials, components, subassemblies and finished goods and a stabilized and accurate costs is not a new phenomenon. As noted by Anupindi and Bassok (2008) this is one of the most critical issues in all industrialized entities with the challenge becoming more complicated due to the modern practice of outsourcing and decentralization. Hence, contractors are essential to an entity as they determine the success or failure of their brand based on the quality of services and raw materials. This ranges from finance, legal and other departments in an organization. In the context of Etihad Airways Company, they have a vast pool of contractors who are actively involved in their activities (Boarding area, 2015). They are participating in the provision of food, outsourcing of contractors, maintenance of technical equipment’s and other small operational activities to keep the airline in an effective running. According to Barnes-Schuster et al. (2002), contractors ought to strike a balance between their interests and that of their clients. This means that they have a duty, to be honest, and helpful and concentrate on the clients best interests.  Hence, companies must ethically deal with their contractors and maintain a good rapport to the success of the company. This report has argued that Etihad being the second flagship company of UAE need to set a wide array of terms and conditions to manage risks of poor quality, time extension, increased costs and unethical practices.  It is the role of the management to ensure that they set appropriate performance measures monitoring and management to improve their contracting.

 2.0 Management of the Risks of Poor Quality

2.1 Risk of Poor Quality in Contracting

Currently, the major risks of poor quality management is hedged on the lack of transparency among involved parties. According to Spinler (2003) the risk of poor quality can emanate from………………………………………………………………………………………………………………………………..Please contact us to receive guidance, support and tutorial services on this assessment in full based on your organisation background and level of expectations