Incentive Contracts: The Attributes that Matter Most in Driving Favorable Outcomes

Abstract

Incentive contracts have been in place for many years. They represent just one of many contractual tools the Department of Defense has at its disposal to drive certain performance behaviors. Lately, the usefulness of incentive contracts has come into question. The dividends have not been readily apparent. This research study set out to determine what generally afforded strong correlations between incentive-type contracts and expected performance outcomes. Twenty-five weapon system acquisition programs offices were interviewed in various stages of their acquisition lifecycles. A standardized questionnaire-survey was used to capture the data. This presentation prepared for the Fourth Annual Acquisition Research Symposium will address the findings and include a few key recommendations intended to better arm the acquisition workforce on the use of incentive contracts.