Category Archives: Consequence Analysis

The Mathematics of a Performance Based Contract (PBC) – Part 2

In the previous article (see The Mathematics of a Performance Based Contract (PBC) – Part 1) I described how a standard Australian Department of Defence Non-Linear PBC Payment Curve could be described by 2 equations for straights lines of the … Continue reading

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The Mathematics of a Performance Based Contract (PBC) – Part 1

Over the 15 years of applying and teaching Performance Based Contracting (PBC) I have always had trouble trying to describe the mathematics of PBCs, especially to those who Reminded by my family’s current viewing of the US TV Series, Numbers, … Continue reading

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Treatment of Safety in a Performance Based Contract

One topic that has constantly come up over the years is how to treat safety in a Performance Based Contract (PBC). In a previous article (see Designing Successful Performance Based Contracts) we described a PBC as having two main parts; … Continue reading

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Consequence Analysis (Part 1)

In an earlier blog I had mentioned consequence analysis as a method for determining the commercial risk to buyer and seller to avoid the all too common feeling towards Performance Based Contracts (PBCs); that they are riskier than conventional contracts due … Continue reading

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PBC Penalty Shoot-Out!

In recent months I have been involved in a number of Performance Based Contracting (PBC) discussions between buyers and sellers. One consistent point of heated discussion is around the application of a reduction in seller payment as part of the … 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

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