Part 2: Contract & Legal Acronyms
New to this series? Read Part 1: Project Management & Business Acronyms
Today, we aim to shed light on the contracting and legal acronyms we believe every project manager (PM) should know. We hope this article will empower you to confidently maneuver through the world of legal and contracting considerations, all of which can significantly impact successful project delivery.
Understanding contracting and legal acronyms is not merely an academic exercise; it is a strategic imperative for project managers (PMs). In an era where projects are increasingly governed by complex regulatory requirements, compliance standards, and contractual nuances, a PM's ability to comprehend and leverage legal and contracting terms is paramount. PMs with knowledge of contracting and legal aspects are better equipped to manage risks, ensure compliance, and navigate the complexities of project execution in a legally sound manner.
Whether you're collaborating with legal experts, negotiating contracts, or simply seeking to enhance your project management toolkit, this article is designed to equip you with the essential knowledge you need to ensure project success. Bookmark this page, copy and paste it into your own OneNote or Excel acronym tracker, and come back to it when you need it. And don’t forget to come back next week for Part 3 of our series, where we’ll be exploring financial and supply chain terminology.
BOA (Blanket Order Agreement): An agreement that establishes terms and conditions for multiple transactions over a specified period, often used for repetitive purchases of goods or services.
CDA (Confidentiality Disclosure Agreement): A legally binding document through which signing parties agree not to disclose any proprietary information covered in the scope of the document.
COI (Conflict of Interest): A situation in which a person or organization is involved in multiple, potentially competing interests.
CPFF (Cost-Plus-Fixed-Fee): A contract type where the buyer reimburses the seller for allowable costs incurred during the performance of the contract, along with a pre-specified, fixed fee paid to the seller as profit.
CPIF (Cost-Plus-Incentive-Fee): A type of contract where the buyer pays the seller for allowable performance costs plus an agreed-upon incentive fee based on seller performance.
CO (Change Order): An official change to the original scope, schedule, or terms of a contract, often requiring mutual agreement between the parties involved.
CR (Cost Reimbursable): A general term referring to contract types where the buyer reimburses the seller for allowable costs incurred during the performance of the contract. CPFF and CPIF are specific examples of cost-reimbursable contracts.
EOI (Expression of Interest): A document soliciting indications of interest from potential suppliers or contractors for a particular project or opportunity.
FP or FFP (Fixed Price or Firm Fixed Price): A type of contract where the buyer pays a fixed total price for a defined product or service.
HSE (Health, Safety, and Environment): An integrated management system overseeing health, safety, and environmental practices within an organization.
IDIQ (Indefinite Delivery, Indefinite Quantity): A contract type used when the exact quantity and delivery requirements are unknown at the time of contract award.
IP (Intellectual Property): Legal rights arising from intellectual activity.
LOI (Letter of Intent): A document expressing the intent of the parties to enter into a formal agreement and outlining the basic terms and conditions of the proposed agreement.
MOU (Memorandum of Understanding): A non-binding document describing the terms and details of an agreement between two or more parties, including the requirements and responsibilities of each party.
MSA (Master Service Agreement): A comprehensive contract outlining the terms and conditions under which a series of future agreements or orders will be governed.
NDA (Non-Disclosure Agreement): A legal contract outlining confidential material, knowledge, or information that the parties wish to share with each other but restrict access to or sharing with third parties.
PII (Personally Identifiable Information): Information that can be used to identify, contact, or locate an individual, often sensitive and subject to privacy regulations.
RFI (Request for Information): A document used to gather information from potential suppliers or vendors, often in the early stages of a procurement process, to aid in decision-making.
RFP (Request for Proposal): A document used to solicit proposals from potential suppliers or vendors, outlining the project requirements, evaluation criteria, and terms for submission.
RFQ (Request for Quotation): A document used in procurement to request quotes from potential suppliers.
SLA (Service Level Agreement): A contract between a service provider and a customer that defines the expected level of service, including performance metrics and consequences for not meeting the agreed-upon standards.
SOW (Statement of Work): A document that defines the project's scope, objectives, deliverables, timelines, and any other relevant details, usually within the context of a contract or agreement.
T&M (Time & Materials): A contract type where the buyer pays the seller for the actual hours of work performed (time) and for the materials or resources used in the project.