Part 3 of contract managment for Option Year contracts.
The menus which are available when each of the option year funding objects are selected offers additional information about the hierarchy and objects themselves. You must first understand how the hierarchy is formed, which leads to the natural commands available at each level.
1. The first level of the hierarchy is the Project. You must choose “By option year rates” for the “Billing method” before the program will automatically select labor rates from your contract mods. After you’ve done this, employee hours in their timesheets will automatically use labor rates you define below (at the employee labor assignment level).
2. The second level of the contract management hierarchy is the Option Year. This level defines the overall contract, presumably for each year it is optioned, although option years can be subdivided into several sections. You can name these subdivided option years anything you like. When you click on an option year, you can choose to create a new one, duplicate the selected record, create a new contract modification, or finally, delete the selected record.
Usually the next step is to create a new contract modification, which falls under this option year. You’ll need this mod to add employee labor assignments and odc’s. The actual contract modification will specify the employees and odc’s. You simply enter them here.
Duplicating an option year is handy because you won’t need to reenter all the same fields like sub-contract and prime contract, point of contact, and PO. These fields are duplicated for you. None of the records below the option year are duplicated.
3. The third level of the contract management hierarchy is the Contract Modification (MOD). This level specifies the exact list of employees that will work on the contract. You must enter a record for each employee, and a record for each “Other Direct Cost” (ODC). The commands that are available at this level are to create another contract modification, create a new employee assignment under this mod, create a new odc under this mod, duplicate the mod, and finally, to delete it.
If you have a brand new mod, you’ll need to create employee labor assignments and odc’s first. If you have an existing mod, you may consider duplicating it to save work reentering values. (More on that below.) Your contract will specify exactly which employees will work on this project. You simply create a new employee labor assignment for each one. When you do, you’ll specify the period of performance, labor rate, and funded hours. The employee labor assignments and odc’s roll up to the mod level, to the option year level, and to the project level.
Again, duplication is a valuable shortcut. It copies all the employee labor assignments to a new mod and places that mod under a specified option year. This is handy when you receive a new mod from your client which specifies the same employees. You simply duplicate the active one, change the period of performance, and make other necessary tweaks. The new mod is ready to go at a moment’s notice. Just mark it active on the first day of the period of performance. Actually, marking a mod active is just for your own documentation. It helps you go straight to the active contract for the latest rollup numbers. You’ll see green checks next to the active mod and employee assignments to help identify it.
4. The fourth level of the contract management hierarchy is the Employee Labor Assignment. It specifies exactly one employee and the labor rate. That employee will have a period of performance when they will work on the project. The employee will also have a labor rate and hours funded that are applicable to that period of performance only. There are also totals you can use to compare against the original contract mod. Watch these numbers to make sure you are staying on track. When the employee is selected, you can only create a new one and delete the selected one.
5. Also at the fourth level of the contract management hierarchy are the Other Direct Costs (ODC’s). ODC are taken directly from the actual contract mod. They represent additional revenue for the project, and often come as a result of employee performance. Many are the results of awards and milestones.
Simply build out the contract hierarchy according your contracts. The results will be quite pleasing, and will make your job much easier. Let us know how it works out!