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

Reference services, Reference Services: Reference services help the us...

Reference Services: Reference services help the user define and identify his query correctly, bearing in mind how he intends to use the information, since this can affect the

Main features of the new public management, Question 1: Elaborate on th...

Question 1: Elaborate on the weaknesses of the Traditional Model of Public Administration. Question 2: Define the term "Administrative Reform". Why is it so critical i

Subject access to opac, Subject Access to OPAC   The typical OPAC inter...

Subject Access to OPAC   The typical OPAC interaction process requires the matching or crude translation of user vocabulary to system vocabulary. It became apparent that the am

Main entry and subject headings - cataloguing work, Subject Headings: ...

Subject Headings: After classification work, logically the next step in the technical processing of a document is the work of assigning appropriate  subject headings. These a

Describe risk as per the public private partnership guidance, QUESTION ...

QUESTION 1) Describe risk as per the Public Private Partnership Guidance Manual 2) What are the primary objectives of transferring risks from a contracting authority to a pr

Discuss the relationship between treasury and alm, Question 1 ALM deals wi...

Question 1 ALM deals with strategic balance sheet management, which involves various risks, caused because of the changes in exchange rates and the position of liquidity, intere

Response rate, Response Rate This is the percentage of responses genera...

Response Rate This is the percentage of responses generated through a direct marketing campaign.

Modern catalogue - evolution of catalogue, Modern Catalogue - evolution of ...

Modern Catalogue - evolution of catalogue: The 19 th century was an age of great many codes: Catalogue was considered a finding list with the Bodleian concept of literary uni

Non probability sampling, Non Probability Sampling: Convenient samplin...

Non Probability Sampling: Convenient sampling or accidental sampling entails the use of the most conveniently available people  as  subjects  in  the  study. Quota sampling ar

Cluster sampling, Cluster Sampling In cluster sampling there  is  a su...

Cluster Sampling In cluster sampling there  is  a successive random . sampling of units. The first unit  to  be sampled is large grouping or clusters. For example,  in  drawin

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