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

Retrospective survey, Retrospective Survey: In a retrospective survey,...

Retrospective Survey: In a retrospective survey, the researchers may  also like to investigate possible cause and effect relationships by  observing some existing consequences

Fiction - binding policy for libraries, Fiction: Fiction needs most ca...

Fiction: Fiction needs most careful consideration in view of heavy demand and use and its ephemeral nature. Still its heavy use  may prompt librarians to decide  on binding, b

British museum cataloguing rules - library catalogue code, British Museum C...

British Museum Cataloguing Rules: British Museum, Department of Printed Books. Rules for compiling books, maps and music in the British Museum. - Rev. ed. - London: British Mu

Sequence arrangement, Sequence Arrangement: Distribution of library ma...

Sequence Arrangement: Distribution of library materials in the library may be based on any one or more of the following features. Access Consideration : The library may d

Roles of government in the economic development of a country, Question 1: ...

Question 1: (a) What are the main roles of Government in the economic development of a country? (b) What are some of the emerging issues affecting the role of Government?

Problems in selection , Problems in Selection: Periodicals are more im...

Problems in Selection: Periodicals are more important than books for researchers and specialists. They contain more recent information in the form of research papers, news, re

What is strategic management, QUESTION a) What is Strategic Management?...

QUESTION a) What is Strategic Management? b) With the help of a diagram describe the main elements of strategic management process c) Why strategy implementation often is

Define business ethics, Question 1 i) Discuss managing quality transform...

Question 1 i) Discuss managing quality transformation in organisation ii) Explain the concept of quality in manufacturing & services Question 2 Explain the different step

Primary sources of information, Primary Sources These are materials, w...

Primary Sources These are materials, which are the most authentic and original. They usually take the form of a a monograph, journal article, dissertation, report or a paten

Selection procedure - library management, Selection Procedure: There c...

Selection Procedure: There can be two sets of operations in the selection of periodicals: those relating to continuing titles, and those relating to new titles. i) Continuing

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