Circular Ambitions: The Importance of Professional Contract Management
To become more circular as an organization, collaboration is essential. How do you include circularity in contract agreements? And how do you ensure good collaboration with partners? Circularity experts share their insights on professional contract management.
It Takes Two to Circularity
An important starting point for circular ambitions: equal partnership. Ramon van de Kerkhof, commercial manager of the circular furniture supplier Workbrands, is clear about what that means: “It means collaborating based on expertise, being mutually transparent, and both parties giving their all.”
Easier said than done, Ramon admits: “It means having ongoing conversations, daring to address risks, and sharing the costs of learning. Trust in each other is necessary for this to work.” And Ramon is not alone in this: “Circular aspects require more collaboration and customization,” says Marieke van Weerdhuizen, contract manager responsible for office furnishings at the Dutch Government. “This comes into play, for example, when inventorying the current furniture state and logistical processes for reuse. The supplier must also collaborate with other organizational units, such as the facility management company. Circularity can only be successful when we approach each other as equals.”
In short: it takes two to circularity.
The Changing Role of Contract Management
The role of contract management? It changes as a result of circular ambitions. Contract managers check contractual agreements and look for opportunities based on circular ambitions.
“In a circular ambition, it’s important to involve all internal stakeholders – including the contract manager and the user – from the tendering process onwards,” Marieke suggests. “The circular ambition requires a different role and attitude from them during the contract term. In our case, procurement, contract, and facility management are jointly responsible for realizing the circular ambitions.”
The Learning Approach
Circular projects are sometimes still in their infancy. There’s much to discover together. Ramon: “A circular tender comes with unpredictability and diversity. This calls for trust and transparency in collaboration. We continuously consult with each other: how can we increase the degree of circularity in the delivery of our products and services?” The internal organization plays a crucial, guiding role in this. Tobias Strating, head of the Knowledge Cluster Energy & Environment at Roelofs Group, a company active in civil engineering, confirms this.
Tobias collaborates a lot with municipalities: “Municipal project managers often have a civil engineering background and less knowledge of sustainability. Since project managers are not yet held accountable for internal sustainability performance, they have no reason to focus on it.”
Simple KPIs for Circularity
Technical requirements, aesthetic requirements, limiting inconvenience: with so many demands, is there still room to focus on circular ambitions? This depends on the intrinsic motivation of the project manager from the client’s side, says Tobias. And to steer towards circularity, developing simple KPIs is essential.
In the infrastructure sector where Roelofs Group operates, this means limiting the duration of work. This way, users only have to take detours for a short time. Tobias: “Such a simple KPI is not perfect, but it does allow us to make significant progress on many projects. Supervisors and contract managers from clients are not yet accustomed to circularity. That’s why you don’t want complicated assessments.”
Another recommendation from Tobias: derive KPIs from organization-wide objectives. “For office furnishings, we translated our nationwide goals into targets for the category,” explains contract manager Marieke. “By including those goals in performance measurements (KPIs), the contribution within the contract becomes visible immediately.”
When it comes to furniture, for example, there is a performance indicator for using reused furniture instead of new furniture. Tobias also believes that there are still many improvements to be made in practice, such as using environmentally friendly materials or equipment that doesn’t produce emissions.
Three expert tips
Circular contract management therefore comes down to professional contract management. Both client and contractor contribute their expertise and steer – on the basis of equality – towards compliance with mutual agreements and ambitions.
The three experts each provide a tip for practice:
Marieke: “Don’t underestimate your impact as a client: the questions you ask can influence the market. Start small and allow yourself to learn from the experience. This way, you can make adjustments based on what you learn. Discuss these learning experiences openly when talking about managing contracts.”
Ramon: “Combine the different tasks needed to achieve the circular goals into one contract. For instance, ProRail bundled design, supply, and maintenance into a single contract for their office equipment. This makes it easier to work towards circular goals. You’ll also make more significant progress by focusing on the whole process rather than just the delivery.”
Tobias: “Keep it simple. When you begin with circular practices, summarize them in a straightforward performance indicator. If that works well, it becomes a success story that you can build upon. Also, remember that making small changes across many projects has a bigger impact than making multiple changes in one big project.”
This article is based on interviews with Marieke van Weerdhuizen (strategic contract manager for office furnishing at Rijkswaterstaat), Ramon van de Kerkhof (co-founder of Workbrands, specializing in circular furniture), and Tobias Strating (head of the Energy & Environment Knowledge Cluster at an engineering firm & contractor).
