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3.05 Performance Contracting in the Public Sector & the Real World

Tuesday, April 2, 2013
3:00 PM-4:00 PM
Track: Council/Industry Specific
Format: Case Study
Organization: IFMA
Knowledge Level: 200 level
Session Description: Generally when contracting for outsource services, the goal is to get the best service at the lowest price.  In the private sector the past performance of a vendor can play a much bigger role in awarding a new contract than it typically does in the public sector.  The awarding of contracts in the public sector is often constrained by statutory and local requirements.

With performance contracting, you pay the contractor based on their results not their method.  It is a contracting method in which you specify what you want those results to be. The contract can include incentives and/or penalties to the contractor to achieve the desired outcomes.  It should have clearly specified performance indicators expressed as Key Performance Indicators (KPIs) which need to be specific, measureable and achievable.

Performance-based contracts can lead to an improved level of service especially if there is an incentive for the contractor.  There can also be a reduction in total cost. By using a performance contract you have an opportunity to better define the level of service you are looking for.

Discover which outsourced services are right for performance contracting. Learn how to write a performance contract request for proposal, and how much baseline information to include. In the end the contract can be a win-win for you and the contractor.

Learning Objectives:
  • Review the process of issuing performance-based contracts for improved service at a lower cost.
  • Discuss the obstacles that may exist when issuing a performance contract and how to get past them.
  • Acquire examples of performance-based contracts that become win-win for all parties.
  • Discuss why one contractor has come to embrace the approach and wishes more clients used it.
  •     Conference Proceedings



    Eric Connery
    Connecticut General Assembly
    Facilities Administrator
    Office of Legislative Management

    Having been involved in almost every phase of a building's evolution, from design and construction to operation in both the public and private sectors, Eric Connery has been the facilities administrator for the Connecticut General Assembly for 17 years.

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