PMP · Question 13 · Task 8: Negotiate project agreements
A project manager is negotiating a contract with a vendor for critical project components. The vendor is pushing for a fixed-price contract with minimal change provisions, while the project sponsor wants maximum flexibility for potential scope changes. The vendor argues that flexibility increases their risk and cost. What negotiation strategy should the project manager pursue FIRST?
Answer options:
Accept the vendor's fixed-price proposal to ensure cost certainty for the project
Insist on a time-and-materials contract to provide maximum flexibility for changes
Explore hybrid contract structures that balance cost predictability with change flexibility
Escalate the contract decision to the sponsor and let them negotiate directly with the vendor
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