Currently the Quick Report KPI’s available from the e-Quip dashboard screen include some simple contract statistics:
1. The number of contracts renewed in the reporting period
2. The renewal cost of those contracts
These figures come from the contract end date and total cost and are simple to calculate. However, a question has been raised about multi-year contracts. Suppose a contract runs from January 2015 to December 2020. The total contract value is £10k with an annual cost of £1k. At the moment if I run the reports for January 2015 it won’t show the contract as due for renewal since the contract end date is 31st December 2010. In fact, it won’t show anything until the contract expires and then it will give a figure of £10k. This is clearly incorrect but I need some help with how to address this.
My question is: If a contract has a Year 1 End Date of 31st December 2015 is it correct to say that the contract will be renewed then? Normally contract renewal would imply a new contract being created but that won’t happen in this case. So, should this contract appear in the calculation 1 above, or not?
In my opinion the £1k cost should be added to value 2. This could give rise to a situation where the number of contracts to be renewed is 0 but the cost isn’t. She we just treat this as a renewal for the sake of the KPI’s?