1) Centralized Contact: In centralized contact a single organizational entity is responsible for the entire contracting process. The Office Chief or manager is accountable to senior management for all contracting activities. Contracting processes are typically standardized and uniform across all projects.

Benefits/Advantages of Centralized Contract:

• Economies of scale, increasing efficiency and effectiveness.
• A single department is responsible, thus increasing management control.

• Reduces duplication of effort, yielding reduced costs, especially in receiving and inspection costs.

• Centralized contract staff are specialized and can take advantage of market conditions.

• Contract Manager (CM) is better able to deal with consultants because consultants have fewer people to call on.

Disadvantages of Centralized Contract:

• Potential bottlenecks when requisitions are received sporadically, especially at the end of the fiscal year.

• Does not consider the special needs of the Project Manager.

2) Decentralized Contract: In decentralized contracting, CMs maintain control over the contracting process for each project. A staff member from a central procurement office may be assigned to work with the CM.

Benefits/Advantages of Decentralized Contract:

• Project manager maintains control of the contract award.

• Contracting effort is tailored to a single project. Contracting person has fewer other responsibilities and is under the PM's direct control.

• Contracting staff is located nearby, minimizing communication problems.

Disadvantages of Decentralized Contract:

• Duplication of effort in contracting, receiving, inspection, and accounts payable drive total costs higher.

• Lack of standardized procedures makes the consultant's job more complex.