of Standard Contracts into E-Contracting
FEATURED PAPER
By Piero G. Anticona
Lima, Peru
ABSTRACT
According to SpringCM (2018), companies still use several tools to manage contracts such as MS Excel, Contract Management Tools, Shared Drives, email, and other alternatives. It also mentions that 77% of businesses still report human errors in the contract process.
New technologies might help to reduce claims and disputes in projects because it might automatize some activities or processes that mitigate or avoid potential impacts on cost, time, or quality during the execution of project activities.
R. Nyeland (2019) comments that 3D printing, AI/deep learning, big data, BIM model, digital twin, drones, IoT, robotics, and VR/AR are some technologies used in construction. Another technology available is blockchain.
Since the appearance of Blockchain in 2009, M. Bacina (2018) comments that smart contracts are replacing traditional agreements. Smart contracts, inside the blockchain, allow to transport and transfer assets and data without intermediaries. No human action is necessary; it lives on its own. It has a self-executing nature and exists only with a code. It is a safe, uninterrupted, and secure network. The output of a project or agreement fixes, according to the stage, marked dates, and payment, based on a work breakdown structure.
Are smart contracts capable of reducing claims and disputes in projects, are some of the standardized construction contracts adapting their norms to implement e-contracts in their processes?
This research is essential to:
- What do owners have to do to be able to adapt their FIDIC, AIA, EJCDC, or CONSENSUS DOCS to e-contracting?
- What changes or modifications do FIDIC, AIA, EJCDC, or CONSENSUS DOCs need to do to adapt their standard documents for more “E-contracting friendly”?
This paper concluded the following:
Owners can create platforms or use platforms as ConsensusDocs has to manage all the supporting documents offered by FIDIC, AIA, and EJCDC. They also use contract management software to store, track, search, and report the different contracts they manage, but still, some forms vary for each software. Standard contracts forms could be loaded and improve the relationship between parties for different types of contracts.
Owners can also implement blockchain platforms to store, validate, and execute specifics transactions to make faster and trustable the communication between parties. It is essential to determine what clauses can transform in code from FIDIC, AIA, EJCDC, or ConsensusDocs for using smart contracts.
Some actions recommended to FIDIC, AIA, EJCDC, and ConsensusDocs to convert to e-contracting are:
- Load all the forms that are in a text software (for example, in MS Word extension) to a platform, and participants can drag and drop any clause required for different relationships or types of contracts.
- Information required to fulfill like name, dates, durations, milestones, and other relevant information, can be entered as if we were codifying a smart contract, to agree between parties the clause for a specific section.
- As in contract management software, approvals do not require a physical signature or printed documents. Or, like in blockchain, when a rule or agreement meets the specifications, validation is automatic.
- Codify as part of the code for a blockchain (smart contract) to notify an alert when, for example, the blockchain did not reach 51% of approval of a transaction or Notify when there is an approval for payment or money transfer.
- A cloud or blockchain platform can store all the information, and it allows browsing all documentation.
Key words – Standard Contracts, Smart Contracts, Blockchain, E-Contracting, Project Management, Contract Management, Change Management, Contract Management Software, BIM
More…
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How to cite this paper: Anticona, P. (2020). Digital Transformation of Standard Contracts into E-Contracting; PM World Journal, Vol. IX, Issue I, January. Available online at https://pmworldlibrary.net/wp-content/uploads/2020/01/pmwj89-Jan2020-Anticona-digital-transformation-of-standard-contracts-into-e-contracts.pdf
About the Author
Piero G. Anticona
Lima, Peru
Piero Anticona is a project controller with 15 years of professional experience in the sectors of Mining, Energy and Oil and Gas. He worked as Owner, EPCM and Contractor in different projects in Peru, Spain and France. Piero is a Certified Cost Professional from AACE International and Project Management Professional from Project Management Institute. Piero graduated from SKEMA (France) with a Master in Program and Project Management. In addition, he has a major study in Mechanical Electrical Engineering from Universidad Nacional de Ingeniería (Peru). He is currently president of AACE International Peru Section (2018-2019) and he is attending a distance learning mentoring course, under tutorage of Dr Paul D. Giammalvo, CDT, CCE, MScPM, MRICS, GPM-m Senior Technical Advisor, PT Mitrata Citragraha, to attain Guild of Project Controls certification.
Piero lives in Lima, Peru and can be contacted at piero.anticona@gmail.com
To view other original works by Piero Anticona, visit his author showcase in the PM World Library at https://pmworldlibrary.net/authors/piero-g-anticona/
