Relationship management is a key aspect of contract management. An agreement not only provides for the delivery of services in exchange for payment but also reflects and underpins a relationship between the parties. In some cases that relationship is limited to the terms of the agreement. Often, there will be a wider relationship, best served by seeking mutual respect and sufficient knowledge on the part of both Government agency and NGO to be able to preserve each other’s interests. Many agreements between Government agencies and community or iwi/Maori organisations, however, involve a much richer relationship, because:
- The relationship may exist in the absence of any contractual relationship (e.g. a community organisation may have an input into policy development quite separate from any contract). Government agencies should consider if a Treaty relationship exists with NGOs and if iwi/Maori organisations have an expectation of a Treaty relationship. If so, it is desirable to obtain legal advice and ensure consultation with iwi/Maori NGOs and communities has occurred. Such consultation can ensure that the outputs and outcomes being sought are those of interest to the NGOs and communities, not just Government agencies; that services are coordinated with those of other Government service providers; and that any issues arising about the contract can be addressed with a consultative approach.
- The relationship may continue into the medium to long term.
- Each party may expect to undertake repeat business with the other.
- The Government agency may rely on a significant level of alignment between its objectives and those of the NGO.
- The services delivered may be difficult to specify in all respects in advance – this implies some level of discretion will rest with the supplier.
It is important to consider the incentive effects of the agreement, and associated processes on the NGO, and the users or recipients of the service. How will expectations and actions affect the way people behave? The most obvious incentives are the basic terms of the contract, particularly the “rewards” (usually payment) and “sanctions” (what happens in the case of non-delivery). Other aspects of the agreement and associated processes may have significant incentive effects as well, such as:
- The specification of the service.
- The duration of the contract.
- The process for selecting the NGO (including tendering).
- The credibility of the contract management process.
- What happens at the end of the contract.