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

Information services - value-added information services, Information Servic...

Information Services: Some of the significant information services which have been evolved as a result of developments in communications are: electronic delivery of documents,

User interface - value-added information services, The User Interface  ...

The User Interface  User interfaces are mechanisms built into information systems and services to enable the users to utilise these services in an effective manner. The interf

Pamphlets - binding policy for libraries, Pamphlets-binding policy for libr...

Pamphlets-binding policy for libraries: Pamphlets are paper covered materials of  fewer than fifty pages. Most libraries collect pamphlets and if these materials are to be use

Explain critical ethical issues facing knowledge management, QUESTION (...

QUESTION (a) What are some of the major types of Knowledge Management roles that exist in organizations today? (b) What types of competencies should be present in a good Kno

Cumulative index work and loose issue shelving work, Cumulative Index Work:...

Cumulative Index Work: As the name suggests, it pertains to noting by entering down the announcement of cumulative index followed by entering  the receipt of cumulative index

Bill of materials , Bill of Materials  Bill of Materials (BOM) is an im...

Bill of Materials  Bill of Materials (BOM) is an important document for any project, production before launching or material requirement planning process.  The American Prod

Information and library network, INFLIBNET (Information and Library Network...

INFLIBNET (Information and Library Network)   The University Grants Commission (UGC) in its attempt to establish networking has taken the initiative and decided to develop a ne

Assessment of project quality, A ssessment of Project Quality Quality ...

A ssessment of Project Quality Quality management can be measured by having three main components: Quality control. Quality assurance. Quality improvement.

What are the key features of a corporation, QUESTION 1 Describe the ind...

QUESTION 1 Describe the individual and situational factors leading to ethical decision making in the workplace QUESTION 2 What are the challenges for firms attempting t

Filing classified entries, Filing Classified Entries   By classified en...

Filing Classified Entries   By classified entries, we mean entries which hear notation; that is, Class Number and Call Number entries. A Subject Catalogue and an Alphabetico-Cl

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