Tag Archives: PBC

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

Posted in Basis of Payment, Consequence Analysis, Contract Management, payment curve, the How | Tagged , , , , , | Leave a comment

How to Successfully Manage a Performance Based Contract (PBC) – the Prequel

I get many questions from readers of the blog on how to successfully manage a Performance Based Contract (PBC) including what are the critical areas that they need to be aware of. While many of my posts including discussion points … Continue reading

Posted in Contract Management, IACCM, PBC Training, the How | Tagged , , , , , , | Leave a comment

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

Posted in Consequence Analysis, payment curve, Performance Measure, the How | Tagged , , , , , , , | 1 Comment

How to Nudge a Performance Based Contract (PBC) – Part 2

In the previous article (see How to Nudge a Performance Based Contract (PBC) – Part 1) I described how successful contracts deliver the desired outcomes of both buyers and sellers; the classic “win-win” outcome that we all strive for.  We … Continue reading

Posted in Behavioural Economics, Nudging, the What, the Why | Tagged , , , , , , , | Leave a comment

How to Nudge a Performance Based Contract (PBC) – Part 1

Commercial instruments, especially sophisticated ones such as Performance Based Contracts (PBCs), have the ability to shape the behaviour of both buyer and seller.  While many commercial practitioners see contracts in their simplest form, an explicit and directive agreement between buyer … Continue reading

Posted in Behavioural Economics, Nudging, the How, the Why | Tagged , , , , , , , | 1 Comment

Perverse Incentive Follow-up

In earlier articles (see Perverse Incentives – Part 1 and Part 2,  and Unintended and Perverse Outcomes) I discussed the importance of checking the Performance Management Framework (PMF) within your Performance Based Contract (PBC) to watch for perverse incentives.  Those … Continue reading

Posted in Behavioural Economics, Book, Case Study, Incentives, Nudging, perverse incentives, the How, Uncategorized | Tagged , , , , , , , , , | Leave a comment

Award Term – Part 3

Having described the both the key elements and operation of an Award Term in the previous 2 posts (see Award Term – Part 1 and Award Term – Part 2), to aid in our understanding I will now look at … Continue reading

Posted in Contract Consequences, Incentives, the How | Tagged , , , , , , , | Leave a comment