Change Order Automation for Contract Updates

You can automatically update the project contract when changes to the schedule, revenue plan, or budget are approved through a change order. Capture changes to tasks or assignments, assess the revenue impact, and once approved by stakeholders, automatically apply these changes to the associated contract, financial project plan, and budget. This automation improves operational efficiency, reduces manual contract amendments after approvals, and helps minimize billing errors or budget overruns.

Note:

• Contract updates can be driven only from task and milestone resource changes on the financial project plan or budget impacts.
• During implementation, the change implementor can either update the contract automatically or notify contract owners to update the contract manually. Automatic update assumes the change implementor has the necessary permissions to update the contract.

Privileges Required

Users must have the Manage Project Changes privilege to create a change order, perform impact assessment, review, and approve a change order.

To automatically update contracts from a change order, users must also have these existing contract management functional privileges:

• Create Contract (OKC_CREATE_CONTRACT_PRIV)
• Edit Contract (OKC_EDIT_CONTRACT_PRIV)
• Edit Contract by Web Service (OKC_EDIT_CONTRACT_VIA_WEB_SERVICE_PRIV)
• View Contract (OKC_VIEW_CONTRACT_PRIV)

Users must also have the required data security to manage contracts for the applicable business units (for example, access granted through existing business unit–based contract data security policies).

Implement Contract Updates

To implement contract updates from a change order:

1. In the My Work work area, click Manage Change Orders in the panel drawer.
2. Search for and open the approved change order.
3. Move the change order to the implementation stage (if it isn’t already in implementation).
4. Select Implement and Mark Complete.
5. In the implementation flow, choose one of these options:
   • Update contract to amend the contract automatically. Enter the Contract Line and Amendment Effective Date, and then submit the change order implementation. The application automatically amends the contract with the approved adjustments to keep revenue, billing, and financial planning consistent.
   • Notify contract owners to update contract (from the Implementation Options dialog box) to send a notification for manual contract updates when the implementor doesn’t have the required permissions.

After implementation, users can view change order details in the associated contract line comments for audit and traceability purposes. The contract may be pending approval with the updated changes.

Additionally, change orders that are ready for financial project plan adjustments can automatically baseline the financial project plan to keep it synchronized with the latest approved changes.

Considerations for Contract Updates

• You can revise the revenue amounts on existing project billable milestones, and these updates automatically adjust the corresponding contract funding and contract line amounts.

• The Update contract option is available during change implementation only when:

  • The project is linked to a single contract.
  • The contract status is Active or Expired.
  • The change order includes a revenue impact as part of its Project Plan or Budget and Forecast impact assessment.

• You can automatically update the contract only if the change order’s impact assessment level aligns with the project’s contract association. For example, if a project has five top tasks and the contract is associated with just one top task, the contract can be updated automatically only when the change order impacts roll up to that specific top task.