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Many companies use consultants for a variety of projects and tasks.  Consultants may be teams from the larger consulting companies all the way to individuals working as single-person consultants. The consulting work may be done on the premises or off site at the consultants offices or a combination of the two approaches.  While consultants play vital roles for many companies, traditionally they do pose their own set of unique issues and challenges for the finance, legal and human resources departments as explained below.  Taking advantage of some of the new contract lifecycle management technologies would help alleviate many of these issues.

Hiring process

Usually when a department needs help from a consultant and after locating the proper resource and necessary review and interviews, a consulting contract is put in place which should cover the legal and procedural terms, finances and the necessary legal protections for both sides. Traditionally, this process is time-consuming and error-prone and requires many cycles with the management for approvals, finance for funding, legal for the contract and human resources for logistics and payment process and IT for the network and access setup.

The use of a workflow-based request system as a part of contract lifecycle management environment would ensure that the proper approval chain for hiring the consultant is implemented.  The workflow tool would need to be robust enough to handle parallel and sequential approvals as needed.   Complete record of the steps and electronic approvals would need to be preserved in the system. It is important to have a “reminder” and “escalation” capability so that when a manager has not responded within allotted time, the system would send out notices accordingly. Legal group would need to be able to use the information in the approved request to produce the appropriate consulting contract in the system. A contract lifecycle management system should be able to create and issue the consulting contract based on the approved requirements and terms as well as standard clauses and the legal parameters.  The system should allow for negotiations including a workflow process which would get input from the appropriate parties within company as necessary.

While the consultant is on board

While the consultant is on board, there needs to be a process to track and record any equipment or assets which are assigned to the consultant as well as tracking the security and access to the premises such as an office, lab areas, access rights to the information on the network and so on.  There also needs to be a process to maintain a consultant’s records of performance such as timesheets, communications and other related documents. Payments and their approvals records should also be maintained.  This information is usually kept in disparate areas in different departments such as operations, legal, HR and IT departments.  An integrated contract lifecycle management should provide the tools and secure processes for maintaining the above information in the system and be easily accessible to the management.

When a consultant leaves or terminated

Unfortunately, the separation process for a consultant can be very informal and therefore would bypass any required separation processes. Sometimes, the direct manager of a consultant may terminate the consulting contract at any point or at other times the consultant may move on.  A consulting agreement’s termination is not sometimes caught by IT, HR, legal and other departments until days or weeks after it has happened. This could become a problem in properly processing the termination steps for retrieving company assets, accounting for company information available to the consultant and adjusting the IT security and compliance with the required legal and financial requirements at the time of termination.

The contract lifecycle management system should also be able to help in this area.  One effective approach would be to issue a list of all active consultants as the system knows it and distribute it to the managers automatically on a regular basis.  For example, every Monday of the month, department managers would automatically receive this report and would be required to confirm all active consultants and identify those who have left.  The system should notify a responsible manger and escalate the notification if  there are no responses within an allotted time.  As the list of the consultants who have left from the last time it was checked becomes available, the other departments are notified automatically to follow up on any necessary termination steps which might have not been completed.  This would ensure that on a regular basis the status of all active and recently departed consultants are checked and any necessary follow up steps are completed.


The issue of properly managing consultant contracts is important and with the help of a robust contract lifecycle management it can be handled properly.  By using such a system certain checks and balances can be established to make sure that the necessary steps for properly terminating a consulting contract are completed.

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About the author

Mehdi Khalvati, Ph.D. is the president of Axxerion USA. Axxerion’s CMMS module  addresses corrective, preventive and predicative maintenance as well as asset management.  Please send your feedback, thoughts and comments to

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