Monthly Archives: January 2015

Designing Successful Performance Based Contracts

Successful contracts deliver the desired outcomes of both the buyers and seller through a form of commercial construct. This is the classic “win-win” outcome that we all strive for. In Performance Based Contracting (PBC) our goal is the same; delivering … Continue reading

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When the Fair Comes to Town

One of my favourite quotes when talking about fairness of commercial arrangements comes from a US friend of mine which goes: “. . . the only fair I have seen is the one that comes to town twice a year.” … Continue reading

Posted in Consequence Analysis, Risk Management, the How | Tagged , , , , , , | 1 Comment

Measuring and Incentivising Sustainment in the Age of Asset Management

In the early 1990’s when various western defence organisations started outsourcing the sustainment of complex materiel[1] they focused heavily on measuring and incentivising the four related “ilities“; that is availability, reliability, maintainability and supportability. Through the “ilities” we make sure that … Continue reading

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The Cost of Measuring Performance

Peter Drucker famously said, “What gets measured gets managed.” TIn this light, many practitioners in the field of Performance Based Contracting (PBC) attempt to apply large numbers of performance measures in trying to cover the entirety of the contract scope … Continue reading

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Understanding Behavioural Economics

Previously, I mentioned using Behavioural Economics as one technique to make sure that the Performance Management Framework (PMF) drives the desired behaviours. For those of you who want more information on this fascinating topic, can I suggest a free online … Continue reading

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How Much is Enough?

When developing a Performance Based Contract (PBC) one of the questions consistently asked is, “so how much should be put at risk?”. Notwithstanding the fact that highly successful PBCs use a combination of both financial and non-financial rewards and remedies, … Continue reading

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