A project manager wants to establish a long-term contractual relationship with a vendor to govern future services under pre-agreed terms and conditions, reducing the need to negotiate terms for each new project. What type of agreement should the project manager use?
A Master Service Agreement (MSA) is a contract between parties that outlines the general terms and conditions which will govern future transactions or services. By having an MSA in place, the project manager can expedite the contracting process for subsequent projects, as the foundational terms are already agreed upon. This reduces negotiation time and helps manage risk.
A Service Level Agreement (SLA) specifies the performance standards a vendor must meet but does not cover the overarching contractual relationship.
A Purchase Order is used for individual orders of goods or services and does not establish long-term terms.
A Time and Materials Contract outlines payment based on time spent and materials used for a specific project, without setting terms for future engagements.
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