Incentives, Other Management

Assignment Help:

Incentives

These are rewards given when vendor/contractor exceeds your expectation. Incentives should increase contractor?s profit. Incentives can be categorised as:

  • Cost incentive: No incentive for the contractor can be structured. In a contract where design and development are included, a value engineering clause can be incorporated to motivate the contractor to submit a proposal for cost reductions. The contractor gets the opportunity to consider an extra profit for himself while quoting the price reduction.
  • Technical incentive: These are incentives for quality and performance of work. These can also be applied to contracts which include design and development in addition to construction.
  • Schedule incentive: All construction contracts incorporate a Liquidated Damages (LD) clause which refers to penalty for delay in time of completion. Sometimes a Bonus clause for early completion is incorporated. In such a case, the LD clause is called a Penalty clause.

Caution must be exercised while combining cost, technical and schedule incentives in a contract to ensure that different incentives do not counteract or conflict with each other. Also, when more than one contract is awarded, one contractor who is given an incentive for early completion may complete his work early but this will turn out to be a benefit only if you can ensure that the following interfacing contractor can commence his work consistent with the previous contractor?s work completion.


Related Discussions:- Incentives

Elaborate bio renewable resources, Question 1 The resources that can be...

Question 1 The resources that can be continuously replenished with the help of natural processes are referred to as renewable resources. Discuss renewable resources Ques

Follow-up after having received the treatment and got well, QUESTION Se...

QUESTION Service quality in the Health Sector can be defined as how the patient perceives the service dispensed by regional hospitals- a) before going to the hospital for tr

Beta of a share, Beta of a share Financial analysts often talk of the ...

Beta of a share Financial analysts often talk of the beta (b) of a share. We will describe what the beta signifies and the method commonly used to estimate it in this section.

Meaning of classification - library classification, Meaning of Classificati...

Meaning of Classification: Systematic grouping of entities (both abstract and concrete) to meet one's requirement is known as classification. Classification lies at the root o

Analyze the national and regional planning process, QUESTION Previously...

QUESTION Previously, there was much emphasis on preparation of the end state ‘master plan', which was assumed to be sufficient for guiding and controlling future development pa

Size of library building-library management, Size of library building in li...

Size of library building in library management  The size of the library building is determined by the number of clientele it is going tocater to (many subscription and public

Laws of library science, The study of the structure and development of the ...

The study of the structure and development of the UoS by the information professional can be shown to be a necessary implication of the five laws of library science. Law 1 And I

Preperation of a library programme - library building, Preperation of a Lib...

Preperation of a Library Programme of library building in library management A written building  programme (or proposal) is must for any library. It is a basic statement about

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd