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In-Scope and Out-of-Scope Processes
Change Board Processes
Change Definition and Pricing Strategies
Negotiation Tactics and Strategic Resolutions
Arbitration Scenarios and Execution
Requests for Equitable Adjustments (REAs) & Certifications
Claims Against a Subcontractor’s Non-Performance

Change Management starts with:

 

In-Scope and Out-of-Scope Processes

Best Practices defined for In-Scope and Out-of-Scope contracting actions provide for financial considerations and mitigate performance exposures. Flexibility to recognize possible repercussions resulting from changing procedural processes and charting the best contractual course toward successful production is every company’s goal.

Change Board Processes

Best Practices for Change Board processes serve to best integrate and ascertain contract changes within Integrated Product Team (IPT) environments.

Change Definition and Pricing Strategies

While a company wants to maintain a high level of customer satisfaction, companies must take every reasonable step to ensure that their contracts accurately describe the obligations and are modified promptly to reflect changes to obligations that are over and above the contract.  This allows the company to receive full payment for contract changes.  A disciplined system of “Best Practices” must be in place to identify, assess, give notice and request contract coverage for customer-caused impacts upon a company’s contract performance.  Failure to promptly recognize and allow for necessary changes can affect the very survival of a program.

Proven Pricing Strategies must be integrated with change definitions and schedule impacts.  Our experience establishing realistic pricing scenarios are based upon proven success for over forty years in the aerospace industry.  Our significant success rates led to price changes and thus risk mitigation to ongoing company financial performance targets.

Constructive Changes come from a multitude of areas that require documentation and knowledge of contractual change remedies involving customer actions or inactions that have the effect of changing the terms of the contract.  These might include:

Negotiation Tactics and Strategic Resolutions

Review and Assessment of all Fact Finding issues must be completed before the
Initiation of formal offers that initiate the negotiating process.

Types of Contracts and risk analysis expectations of projected settlement positions must be thorough and realistic.

  • Fixed price expectations and payments provisions such as Progress Payments and Milestone Payments constitute the criteria for final acceptance of F.O.B. points and liabilities leading to final payment.

  • Incentive positions regarding: Award Fee Criteria and Payments, Delivery and Performance.

  • Cost Incentives: Sharing Provisions (over/under cost targets), Calculation of Fixed  Price Incentive Point of Total Assumption (PTA)
    and Ceiling Price.

  • Strategies must be implemented to resolve fact-finding issues.
  • Pricing Strategies need to be adopted addressing the management of risks.
  • Strategic Resolution Scenarios
  • Integration of Strategic Sales Planning and Growth

Business success or failure often results from choices made during contract negotiations. Negotiating skills are a hallmark of GMC2 personnel.

Arbitration Scenarios and Execution

Skillful and careful negotiations during the arbitration of disputes can determine critical outcomes for the survival of an important program or, a company itself.  Such talent is the result of many years spent resolving difficult issues and bringing disagreements to successful conclusions for all involved by GMC2 experts. 

Strategies include:

  • Review and analysis of arbitration remedies arising from contractual disputes.

  • Development of entitlements and remedies for arbitration decisions arising from disputes.

  • Legal assessments.

  • Assistance in the selection of a mutually acceptable mediator.

  • Negotiation of terms of mediator’s proposal.

  • Negotiation of agreements on submission and process for binding arbitration
    • Procedures
    • Bifurcated hearing process
    • Schedule and location for hearing
    • Cost of arbitration
    • Cooperation of the involved parties

  • Settlement agreements.

  • Definitive contract incorporation of settlement agreements and payments.

Requests for Equitable Adjustments (REAs) & Certifications

Thorough research aids in reaching reasonable adjustments to disputed issues. Favorable conclusions address:

  • Contemporary notions of fairness and equity.

  • All facts and circumstances of a case are viewed from that point in time when events gave rise to the occurring adjustment.

  • What would a reasonably prudent company have done under the same circumstances.

  • Using the best evidence available under the circumstances to resolve issues.

  • All required certifications are researched and prepared to complete necessary data.

Claims Against a Subcontractor’s Non-Performance

Occasionally a company is forced into resolving this unpleasant issue.  For whatever reason a supplier must defend itself or, seek restitution from one of its suppliers.  GMC2 can help resolve a bad situation such as this in an equitable manner.

A complete review and analysis of remedies involving subcontractors who have been directed by the Prime Contractor and/or Original Equipment Manufacturer is prepared.

A proposal is prepared and submitted.  Fact-finding and support during negotiations is provided in order to obtain financial redress and consideration due to the performance impact of the supplier in question.  

Such impacts may include:

  • Materials and workmanship quality

  • Acceleration

  • Penalties resulting from a supplier’s delivery performance

  • Failure to meet Statement of Work and/or Services performance requirements

  • Failure to meet Specifications

  • Failure to correct performance in accordance with issued Cure Notices

  • Termination for Default considerations and remedies

  • Failure to provide data requirements in a manner suitable for its intended use in support of delivery
          Growth Management and Constructive Changes, LLC          Tel: +1 775-870-7168