The purpose of contracts Digital technologies are transforming markets supply chains and operational interdependencies Society is demanding increased supplier responsibility and integrity ID: 605611
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Slide1
Contracting TodaySlide2
The purpose of contracts
Digital technologies are transforming
markets,
supply chains and operational interdependenciesSociety is demanding increased supplier responsibility and integritySuccess depends on new partnerships, increased collaborationA consequence is the need for increased clarity of commitments and obligationsSlide3
“Contracts today are a framework for business operations”Slide4
Driving Change.
Relational Contracting exists in
a spectrum of collaborative modelsSlide5
High-Performance
Contracting
How does
a contract enable value? Through terms that:Set mutual objectivesEstablish performance management systemsChampion problem solving Instill a “no blame” culture Foster joint workingEnhance
communicationPromote continuous improvementDefine gain sharing arrangementsSlide6
Supporting the business with new
commercial models
Outcome / performance based contracts
Payment by resultsRelational contractingAgile contractsShared benefit contractsSlide7
Typically, performance-based contracts allow us to…
Benefits realized when using PBCs
31.7
strongly
agree
strongly
disagreeSlide8
Typically, performance-based contracts come with the challenge of…
Challenges related to using PBCs
31.7
strongly
agree
strongly
disagreeSlide9
Contracting competence
The winners will be those who:
Deliver outcomes
Enable the effectiveness of othersChallenge traditional attitudes and behaviours