Distribution and Materials Handling Focus: Our Weekly Feature Article on Topics Related to Distribution Management and Material Handling Strategies and Technologies  
 
 
  - February 18, 2008 -  

Documenting Project Events Key to Resolving Later Disputes, Saving Money

 
 

Side with the Better Log Often wins Arguments Down the Road; “Important but not Urgent,” it Rarely Gets Done Well

 
 


SCDigest Editorial Staff

One important, but rarely discussed, aspect to a new distribution project, especially those involving major deployments of software or material handling systems, is the need to document in detail progress, issues and communication as the project unfolds.

SCDigest Says:
The idea isn’t to set up an adversarial system. Rather, by maintaining and sharing a summary of key decisions, communications and expectations, it makes for a more positive relationship by catching potential issues early, before they explode into major disputes further down the load.

What do you say? Send us your comments here

Why? Because this information can be crucial later on to resolve disputes with vendors and negotiate cost overruns, and prevent many potential issues from developing in the first place.

He Who Documents Usually Wins

No one plans or expect problems, but the reality is that there are very few large-scale projects that don’t create a number of issues that require resolution between customer and vendor.

What nearly every vendor knows: the side that has better documented what has occurred usually has the upper hand in settling such disputes.

The good news for buyers – vendors still rarely do it well.

Both sides are usually pretty good at documenting known issues – often called “punch lists”-  that need to be worked on to take care of problems, make small enhancements, etc., as the projected is tested and goes live.

But few companies do a good job of documenting everything else – other issues that arise, what progress is made during each week during the build phase of the project, specific tasks the vendor or customer agree to complete, requests for information from each side and when that information is delivered, etc.

(Distribution and Materials Handling Article - Continued Below)

 
 
CATEGORY SPONSOR: LONGBOW ADVANTAGE - JDA SUPPLY CHAIN CONSULTANTS

Download Longbow Advantage

Business Briefs

 

 

The Keys to WMS Success,

Maximizing JDA WMS

Performance and More

 

 

 

 

 

 
 

Distribution and Materials Handling Article - Continued

The goal – develop a reasonably detailed project “diary” that can be later used to review a wide variety of billing and other issues if needed.

“If one side of the relationship has well documented what has occurred, and the other side hasn’t, the side with the documentation has a tremendous advantage in any dispute, large or small,” SCDigest Dan Gilmore notes.

Gilmore says effectively documenting the project is one of those tasks that falls into the “important but not urgent” category of activities, and as a result it often doesn’t get done with all the other pressing needs of the project. This applies to vendors as well as their customers. Nonetheless, companies that find the discipline to do a good job of documentation, usually by assigning a specific individual to that task, and ensuring weekly reports are not only developed internally but sent to the other party, will often be quite thankful they did so down the line.

Billing Disputes

Billing disputes often arise, especially at the end of a project when the total tab is calculated. While most major new additions to the original project scope are well defined and receive formal approval, billable hours and costs can creep up in other areas, especially when the customer receives only an estimate from the vendor, not a fixed price. Sometimes, even additions to the project that may cost tens of thousands of dollars can be misunderstood by the two sides.

Decisions and communications made in the heat of battle are often forgotten or distorted.

A customer may think a change that a vendor's project leader suggests comes at no additional charge, while the vendor assumes the opposite. Extra project hours can be incurred because one side or the other is waiting for a response or action from the other side.

When all these types of occurrences are not documented, it naturally leads to potential problems. If there is a dispute, and the vendor, for example, can cite the date, time and individual who authorized a change, and the customer can’t point to its own documentation, the vendor likely wins that battle.

The idea isn’t to set up an adversarial system. Rather, by maintaining and sharing a summary of key decisions, communications and expectations, it makes for a more positive relationship by catching potential issues early, before they explode into major disputes further down the line.

 
     
Send an Email
     
     
l .