Efficiency in Commonwealth Contracting? You bet!

Related Topics:

Beyond compliance

2 May 2025

Synergy Law Executive Director, Daniel Myles-Abadoo

5 minutes

Not only is the Commonwealth Government a big spender, but it has an almost incalculable number of suppliers and stakeholders across a diverse range of activities – from purchasing submarines and warships for the ADF, art for the National Gallery and underwriting massive infrastructure projects. The list could go on and on – considering the Federal Government awards about 70,000 contracts annually, valued at between $50 billion to $70 billion. That’s a staggering amount of money and an equally staggering number of suppliers – and particularly so when considering that Rio Tinto, the mining conglomerate spent $16.1b with Australian suppliers in 2024. In many ways, the Commonwealth is ‘a big business.’ Like any business – big or small, it is faced with complex legal frameworks, competitive pressures and a mission to generate value-for-money. That’s a tough ask, particularly when you consider that Australian taxpayers fund those activities. It’s also why it’s essential for Commonwealth agencies to take innovative approaches to contract management.

In my firm’s experience, Commonwealth agencies have produced phenomenal results by ‘leaning into’ automation and AI; centralised contract management platforms; data-and-analytics collaborative tools, along digital signatures and workflows. But the first questions is – why? The simple answer is that effective contract management is crucial for organisations aiming to optimise their operations, ensure compliance, and mitigate risks. Like major private sector organisations, the Australian Government – understandably, wants to take advantage of its size and scale so as to generate savings and efficiencies related to its roughly $60b annual ‘spend.’ For that reason, Australian Government agencies are increasingly focusing on improving their contract management processes to generate those savings, while enhancing service delivery and ensuring accountability.

By no means is the following a definitive list, but I’ve tried to summarise how and why public sector agencies can uncover some ‘hidden gems’ that can help drive real efficiencies.

1. Automation and AI technology: Many organisations are now leveraging AI-powered contract management software to streamline contract creation, review, and compliance checks. Tools like DocuSign CLM and Agiloft CLM utilise machine learning algorithms to analyse contracts, flagging potential risks and ensuring that terms align with organisational policies. By automating repetitive tasks, businesses save time and reduce human error.

2. Centralised Contract Repositories: Centralised contract management is all about keeping and handling contract-related documents in one main spot Many organisations have moved towards centralised contract repositories that provide a single source of truth for all contracts. This approach allows stakeholders easy access to contract documents, facilitates collaboration and minimises the risk of my personal ‘pet peeve’ – version control. Using platforms like SAP Ariba, teams can organise contracts by categories, making it faster to retrieve necessary documents. While not a platform itself, the Department of Finance’s Contract Management Guide provides comprehensive instructions and best practices for contract management within Australian Government agencies. It also includes methods for categorising contracts and managing them effectively throughout their lifecycle. This can really drive down the risk of missing renewal dates, setting agencies up for success remembering to explore the market and a host of other benefits.

3. Data Analytics for Decision-Making: Organisastions are increasingly turning to data analytics to derive insights from their contracts. Benefits include negotiating better terms in renewing or future contracts, proactively managing obligations, thereby enhancing overall efficiency. Australian Government entities also use data analytics to monitor and analyse contracts for compliance and efficiency. By leveraging advanced analytics, entities can identify patterns and trends in contract data, ensuring better management and oversight of government contracts.

4. Collaborative Tools: Organisations can integrate their Customer Relationship Management (CRM) systems with contract management functionalities to allow real-time comments and discussions on contract revisions. Integration of collaborative tools like Microsoft Teams into the contract management process provides powerful features that enhance communication and collaboration both internally with the contract management team, and externally with clients, vendors, and other contract stakeholders. This fosters better communication and reduces lag time during the review and approval processes.

5. E-signatures and Digital Workflows: The adoption of e-signature solutions like Adobe Sign (AKA Acrobat Sign) has transformed the contract signing process. Businesses can now execute contracts quickly – and without the need for physical travel or printing. By implementing digital workflows, organisations can automate the approval chain, set reminders for renewals, and ensure compliance in a timely manner.

In today's fast-paced business environment, the increasing complexity of contract management necessitates the use of technology, data analytics, and collaborative tools. These innovative strategies enhance compliance, reduce operational risk, and optimise contracting processes, ultimately boosting organisational performance. Adopting these modern approaches is essential for maintaining efficiency, effectiveness and driving better business outcomes.

Synergy Law utilises its extensive industry insights and expertise of its skilled consultants to help government agencies implement tailored procurement and contract management practices. Contact us to learn more about how we can work with you to achieve the best outcomes for your organisation.

Back to Insights