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

Merits of dictionary catalogue, Merits of Dictionary Catalogue: a)  It...

Merits of Dictionary Catalogue: a)  Its alphabetical arrangement is easy and simple to use. Anyone knowing the letters of an alphabet and being able to refer a dictionary can

Project management approach and philosophy, P roject Management Approach a...

P roject Management Approach and Philosophy A philosophy is an outlook or a way of thinking about the field of application. A project management philosophy reflects the way an

Pestel analysis of the macro-environment, QUESTION 1 Explain each of th...

QUESTION 1 Explain each of the following concepts- (a) PESTEL analysis of the macro-environment (b) Porter's five forces (c) Value chain analysis QUESTION 2 Th

Introduction to resource sharing network, Introduction to Resource Sharing ...

Introduction to Resource Sharing Network The term 'network' always has a wide range of meanings in everyday life and this situation is further complicated because it has two v

Discuss the meaning and advantages of containerization, Question 1 Logi...

Question 1 Logistics is one of the key areas in international business. Explain the meaning and objectives of logistics Question 2 Which is the main transport document

User registration, User Registration An obvious first step in any circ...

User Registration An obvious first step in any circulation system is to register the users or borrowers. This is a time consuming and somewhat expensive procedure but mandator

Filing equipment -library equipment , Filing Equipment -LIBRARY EQUIPMENT-L...

Filing Equipment -LIBRARY EQUIPMENT-LIBRARY MANAGEMENT  Provision for filing has to be made for many kind of materials, from architectural and technical f very  large size  to

Problems of dds and role of internation organisation, PROBLEMS OF DDS AND R...

PROBLEMS OF DDS AND ROLE OF INTERNATION ORGANISATION: Copyright issues, non-availability of publications and restrictions imposed on the storage and delivery of documents elec

Terminologies in library science, Relation to other Terminologies in Librar...

Relation to other Terminologies in Library Science: Classification is a vital discipline in the field of library and information science and pervadesall the other sub-fields o

Different types of hospitality offering businesses, Question 1: (a) Sho...

Question 1: (a) Show what is meant by the managerial environment? Illustrate your answer with specific examples using both internal and external environmental influences within

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