How to Renew a Contract
Suppose that you have a contract which runs from 1/1/2011 to 31/12/2011, how should you renew it for 2012? Perhaps it might be better to emphasise how not to renew it. The simplest thing to do is simply to edit the contract and change the start date to 1/1/2012 and the end date to 31/12/2012.
This is an extremely bad idea! If you do this you immediately lose all historic information about the contract. Quite apart from that, all of the jobs that were linked to last year’s contract will now be linked to this year’s, as will all the jobs from the year before that, etc.
Never renew a contract by editing an existing contract
Always renew a contract by copying an existing contract
This means that if you have had a contract for 10 years and renewed it every year, then you should have 10 distinct versions of that contract. Each will have different dates, will probably have different financial details and the equipment schedule for each will most likely be slightly different.
The basic steps in contract renewal are:
1. Make a copy of the contract to be renewed, along with its equipment schedule
2. Edit the new contract to reflect the new dates, reference numbers, financial details etc.
3. Remove any devices that are no longer covered from the new contract schedule. For example, some of the devices covered by the old contract may have been decommissioned and cover is no longer required
4. Add new devices to the new contract schedule as necessary
As you would expect, E-Quip contains tools to automate this process.
On the contract summary screen, select the contract to be renewed, right-click the mouse and choose Renew from the menu. This will display the Contract Renewal Wizard, shown below.
The information requested by the wizard is fairly self-explanatory. The only information which is mandatory is the contract code, which is auto-generated exactly as if you were adding the new contract manually.
How can E-Quip determine the start & end dates for the new contract? Basically, it can’t, and neither can any other piece of software. The only people who know these dates with absolute certainty are you and the contract supplier. They will be included in your contract documentation. E-Quip can try to suggest dates based on the contract being renewed, but only your documentation will tell you if these dates are correct.
The New Contract Start Date
The wizard will assume that the new contract is to run sequentially with the contract being renewed. i.e. If the last contract expired on 31/12/2011 then the new contract will commence on 1/1/2012. This is a reasonable assumption, but might not always be the case, so always remember to check this date.
The New Contract End Date
Suppose that the contract being renewed ran from 1/1/2011 to 31/12/2011, which is a span of 365 days. Does that mean that the new contract should run for 365 days? If this were the case we would lose a day’s cover as 2012 is a leap year. It is probably more common for a contract period to be 1 year than for a specified number of days (i.e. 1 year rather than 365 days), so it is reasonable for the wizard to suggest dates of 1/1/2012 – 31/12/2012 for the new contract dates, but there is no guarantee that this is correct. Remember, always check the contract dates.
What if you are renewing a contract that ran from 1/12/2011 to 31/12/2012. This is a 31 day contract, so the new contract should run from 1/1/2012 to 31/1/2012, but what should happen the next time this is renewed? The December to January renewal was simple as both months have 31 days, but January to February is more problematic. The new start date will obviously be 1/2/2012, but should the end date be 29/2/2012 (remember that 2012 is a leap year) or 2/2/2012? Is this a monthly contract or a 31-day contract?
While you might accept that the concept of a monthly contract is more common than a 31 day contract, this is not necessarily the case when contracts are for services which are charged daily. For example, rolling 28-day contracts for mobile phones are quite common.
The important point is that the dates suggested by the wizard are exactly that, suggestions, whose purpose is to save you some typing if they are correct. They should always be checked.
In the example above of the (presumed) monthly contract, the dates suggested by the wizard for each renewal will be:
What does Auto-Renewal Do?
1. It creates a copy of the contract being renewed with a new contract code, auxiliary code, supplier reference, order number and start/end dates. All other values are copied from the original contract.
2. It copies all active equipment from the previous contract equipment schedule to the new equipment schedule. In this context, active equipment means equipment with a status class of active, where the equipment record has not been deactivated.
3. The Renewed flag of the old contract is set.
What Should you do Next?
Once you have created the new version of the contract you should:
1. Edit the new contract to change any data which is no longer correct. For example, new contract financial details may need to be altered.
2. Remove any devices which are no longer covered from the equipment schedule.
3. Add any new devices to the equipment schedule as necessary.
A PPM Masterclass – Part 3: PPM Scheduling for Devices Covered by Maintenance Contracts
Why should your strategy for planned maintenance be any different than for devices that you maintain in-house? If you are familiar with E-Quip AM PPM scheduling (there are several posts on this blog about this) then you will know that as you complete a scheduled PPM job the next job is automatically scheduled. Surely this is equally applicable for in-house and contract-based maintenance?
Well, although you can do this there are a few differences that it pays to take into consideration. The first is that if you rely on the standard auto-schedling features of E-Quip, then any jobs scheduled for the future will be associated with the current contract. That’s fine if the job is the first visit of a multi-visit contract: the future jobs should be associated with the current contract. But if the job relates to a single visit contract, or is for the last visit of a multi-visit contract, then the contract assigned to the next job will be incorrect and would need to be manually adjusted.
Another complication arises when it is time to consider whether or not the contract should be renewed. Before you renew a contract it would be good governance to check to see if the contractor actually met the terms of the contract this year. To do this, the simplest thing to do is to find all jobs that were planned under the contract and check that they have been completed. A very simple filter will identify all jobs carried out under the contract, but you if you have used auto-scheduling this list will also include jobs scheduled for next year. You must remember then to exclude any future jobs from your evaluation, which is one more step to remember, albeit a very small one.
So, you review the list of planned jobs, and if you are very lucky, every one of them will have been completed satisfactorily. It is far more likely that some of them will have been missed: possibly the devices could not be found, or were in use by patients, or maybe the contractor did not make the required number of visits. You must then decide what to do about the uncompleted jobs. The number may be so small that you decide to accept that there was a good reason for them not being done, or you may call the contractor in again to do the uncompleted jobs. Either way, the outstanding jobs will be closed, which will in turn generate more jobs for next year.
Suppose that you choose not to renew the contract; you now have possibly hundreds of PPM jobs scheduled for next year which must be deleted or cancelled (the latter is preferable). If you do decide to renew the contract you must now:
a) Renew the contract
b) Update all the jobs that were created by auto-scheduling for the old contract so that they are associated to the new contract.
c) Adjust the planned dates for those jobs to reflect the visit dates planned for next year.
While this might not seem like a huge amount to remember, the more manual your processes are, the more error-prone they are likely to be. This is why we don’t recommend using auto-scheduling to manage contract visit jobs.
An Easier Way
Rather than linking devices to PPM schedules, to overcome these problems we recommend that you use contract-based scheduling to manage devices which are maintained under 3rd-party contracts. “Contract-based scheduling” means that the jobs for contract visits are created (i.e. scheduled) when the contract is taken out or renewed.
When you set up a contract one of the things you must do is identify the equipment which is covered. There are 2 ways to do this, depending on the number of assets on contract.
a) Adding a Small Number of Devices to a Contract
From the contract property page, go to the Equipment Schedule tab (the equipment schedule is the list of devices on the contract). From here devices can be added to and removed from the contract. To add a device, simply add its details in the grid template row then press either Enter or F2, just like editing any other embedded list in E-Quip.
b) Adding a Large Number of Devices to a Contract
The method described above would be very time-consuming if you needed to add several hundred items to a contract. It is far simple to work instead from the equipment summary screen. From here, first identify the equipment that is to be added to the contract. This will involve setting a filter of some kind, depending on how the devices can be identified. Then, in the grid select the items that you want to put on the contract. Right-click the mouse and choose “Add the Selected Assets to a Contract“. A small screen will appear which will allow you to select the contract and optionally enter the coverage start and end dates. If you omit the dates then the contract start and end dates will be used.
When you click Ok, all of the selected devices will be added to the contract.
So you’ve set up the contract and linked all the covered equipment to it, how do you schedule the jobs for the visits? Presumably you will have discussed and arranged the visit dates with the contractor. From the contract summary screen, select the contract, then right-click and choose “Create Contract Visit Jobs“.
This screen allows 2 visits to be scheduled; to do more, simply run the urility several times. Enter the dates of the visits and some work instructions, a job status and type, and then click Ok. The system will create a job for each visit for each device covered by the contract.
Renewing/Cancelling the Contract
What happens now at the end of the contract term? As before, you either renew the contract or not. Finding all of the jobs scheduled for this contract is a trivial filter allowing you to assess how many of the jobs have actually been completed. As before you can either close down the uncompleted jobs or call the contractor back in to do them.
If you do not renew the contract then there is nothing else to do, as no future jobs will have been scheduled. If you do renew the contract then simply repeat the visit scheduling process once you have arranged the dates with the contractor.
What is the easiest way to renew the contract? Select the contract on the contract summary screen then right-click the mouse and choose “Renew“. This will display the following screen:
Enter the new details for the contract as appropriate. For contracts covering a large number of assets, or where the assets covered by the new contract are broadly similar to the contract being renewed, tick the check-box to copy all devices from the old contract to the new. When you click Renew, a new contract will be created and, if you ticked the box, all assets will assigned to it. Naturally, only active assets are copied from the old to the new contract.
It will often be the case that some of the devices covered by the previous contract will have been decommissioned during the year and will not be covered by the new contract. These should be removed by opening the newly-created contract, selecting the devices to remove, and pressing the Del key.
Now you can schedule your contract visit jobs as previously described.
Of course, there’s nothing to stop you managing contract jobs in the same way that you manage in-house work, we just think that contract-based scheduling will make your life a little bit easier.