Contract Creation and Management Simulation

Running head: CONTRACT CREATION AND MANAGEMENT SIMULATION

Contract Creation and Management Simulation

University of Phoenix

Enterprise Risk/MBA560

Introduction

In today’s business environment companies create contracts to facilitate successful business relationships. In the management simulation, Span Systems and Citizen-Schwarz AG (C-S) are struggling to work together to complete a business contract that has become dysfunctional. Span Systems is one of the leading and most prestigious banking software companies located in California. Span Systems develops custom e-banking software. The company is valued at $85 million. Kevin Grant is the Director with Harold Smith being the Transaction Attorney. Span Systems was approached by Citizen-Schwarz AG to develop a Java-based transaction processing software program. Citizen-Schwarz AG is a German bank located in Stuttgart with revenues in excess of $20 billion. Leon Ther is the Outsourcing Director for C-S.

Span Systems and Citizen-Schwarz AG signed a one year contract in which Span Systems was to develop a Java-based transaction processing software program for $6 million. C-S has stated to Span Systems that a potential larger e-CRM order is hinging on the performance of the Java-based transaction processing software and Span Systems is hopeful to receive this larger project. Eight months into the Java-based transaction software project, Leon Ther becomes furious with Span Systems’ deliverables being behind schedule along with the quality of the deliverables being unacceptable. Leon Ther asked Kevin Grant to transfer all unfinished code to Citizen-Schwarz AG to find another company to complete the job. Leon Ther also indicated a rescission of the signed contract. Span Systems has heard rumors that Leon Ther has approached another software company to complete the work Span Systems was under contract to finish. At this point, both companies are dissatisfied and seek changes to the...