Performance Management: Performance Based Contracting Best Practices

Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
    Posts
  • #292039

    We are seeking information on performance based contracting best practices to induce supplier performance through incentives or penalties, and to put more delivery and performance teeth into contracts and sourcing efforts.

    1. How did your organization begin to utilize a Statement of Objectives in contracting?
    2. What were the biggest challenges in writing a Statement of Objective and identifying key metrics? How did you overcome these challenges?
    3. What are some examples of key metrics used to incentivize performance?

     

     

     

    If you wish to donate any templates or tools to this inquirer or to the SIG Resource Center, please feel free to email Mary Zampino directly at [email protected]. All templates and tools can be scrubbed by SIG and approved by you before posting.

    #292660
    Anonymous
    Guest

    2. What were the biggest challenges in writing a Statement of Objective and identifying key metrics? How did you overcome these challenges?
    The biggest challenge was getting the stakeholder out of the mindset of providing a statement of work. In other words, the stakeholder wanted to tell potential vendors how to do the work rather than describe an end goal.
    I entice the stakeholder to work backwards by asking leading questions. Such as:
    • What is this product supposed to do?
    • How will this product or service be used?
    By listening to the stakeholder I begin to help them determine exactly what they want out of a particular procurement – their answers become the objectives.
    Once we have developed what our objectives are, we can work backwards to determine what steps need to be taken to meet those objectives and outline the objectives of those steps.
    This step may or may not be needed depending on the complexity of the procurement. There have been times that I have found it useful to remind the stakeholder that with a Statement of Objectives we are relying on the expertise of vendors to determine how best to meet our goals (objectives).

    #292661
    Anonymous
    Guest

    This is a bit dated, but here’s a link to a Compass (pre-ISG acquisition) on the basics of penalties and incentives in outsourcing. http://www.outsourcingintelligencenetwork.com/oi_prod/images/oi_articles/Bestpractices/compasssticksandcarrotspenaltiesandincentivesinoutsourcingagreements.pdf

Viewing 3 posts - 1 through 3 (of 3 total)
  • You must be logged in to reply to this topic.