Recognizing_and_Minimizing_Tort

Kevin: The contract with Citizen-Schwarz AG (C-S) is now eight months in and during the past couple of months Span Systems has fallen behind schedule. In order to maintain the aforementioned schedule there has been some issues with the quality of Span’s deliverables. Leon Ther the IT Outsourcing Director of C-S has written me in regards to the current problems he has seen over the past two months. Ther is furious over the fact Span has fallen behind schedule as well as the quality of the programming that has been delivered, it has been found that several severe “bugs” exist. Currently Ther is requesting that Span turns over all unfinished code and the rescission of the contract to date. With full knowledge that the loss of C-S will not be acceptable I believe we must review the contract, identify potential risks within and begin to minimize our liability so Span can turn this around and keep C-S as a client. In reviewing the situation Span can begin to identify the varied risks as well as potential opportunities available, this information will also help in future contracts as well. Since the beginning of the contract eight months ago there have been several delays due in part to extraordinary, excessive changes requested by C-S. Within the contract Span agreed to ordinary change requests, I have been made aware of the fact that many of the changes thus far have been anything but ordinary. These changes as well as a recent change in project structure have given way to the current problems between both parties ability to meet the deadlines originally set forth in the contract. Contracts are very important to daily business function and are a necessity when dealing with legal matters, although they are still open to interpretation by legal standards. When a contract is vague it leaves companies open to lawsuits and many conflicts can arise between the contracted parties (Moore, 1999). Span can learn from the issues with C-S and can apply this new insight to future contracts. When contracts come in dispute it could be very costly in not just financial lost but reputation and production as well, this is especially clear in the disputes Ther had put forth when demanding to rescind the contract. There were many clauses put in place to protect Span but they were vague and didn’t have any real method of communication or collaboration between the two companies. In order to keep up with deadlines our programmers have had to work faster at the expense of Span’s usual quality check systems, therefore the quality of the deliverables has suffered under the strain. I have a few suggestions that should provide more clarity to the contract, satisfy the client and be beneficial to all parties involved. One way to cope with these problems and facilitate changes more effectively is to appoint a Change Control Board (CCB) that will be made up of me, the project manager, and the lead software engineer from C-S (UoP, 2010). The CCB will review change requests and flag any changes in project scope, it is recommended that C-S be charged for changes. Upon the ratification of the contract, the price per function point change will escalate every three months until project completion. Another way to deal with the growing demand of the project is to enlarge the team of engineers presently working on the project. In scaling up the team Span will be able to better deal with the current deadline situation and will be able to complete the work more efficiently than before. The original contract allowed for eight programmers, I suggest that we amend the contract to allow for an additional 10 programmers to be hired to complete the project by the agreed upon deadline. Additionally, Span will agree to send the resumes of the new programmers to C-S within five days of the effective contract date (UoP, 2010). Also as a measure of quality control I suggest that Span begin the process of uploading daily project updates to Span's Intranet, this will provide insight to C-S as to where the engineers stand on the project on a daily basis and therefore reduce the risk of Ther concluding that work is not being done in a timely manner. By managing the current contract Span will be better equipped to handle future contracts, it is obvious that Ther was willing to work with Span to fix the issues in scheduling and quality but due to the lack of foresight in management there were many missed items in the contract. The contract had in place certain provisions to ensure a smooth run, the problem being that the provisions were very one-sided and therefore the dispute developed. Many things could have been handled in a more efficient manner such as more quality check systems in place, having a better understanding of the scope of the project and setting some limitations on how changes were received and dealt with. In retrospect there were flaws on both sides of the argument and while the contract was saved many of the issues could have been originally avoided. References Jennings, M.M. (2006). Business: Its legal, ethical, and global environment (7th ed). [University of Phoenix Custom Edition e-Text]. Mason, OH: Thomson/ South-Western. Retrieved 8/29/10. University of Phoenix. (2010). Contract Creation and Management [Computer Software]. Retrieved from University of Phoenix, Simulation, Law531 – Business Law course website. Retrieved 8/29/10. Ross Moore, (1999), Mathematics Department, Macquarie University, Sydney. http://www.ghanalandlaw.com/html/Robertson.v.NiiAkramahII.htDir . Retrieved 8/28/10.