DOD Has Increased its Use of Fixed-Price Incentive Contracts, but is it Getting Better Outcomes?

Abstract

Department of Defense (DoD) guidance encourages the use of fixed-price-incentive contracts to acquire major weapon systems, where appropriate. These contracts can provide contractors with incentives to keep costs in check and stay on schedule. This presentation looks at (1) the extent to which the DoD has awarded fixed-price incentive contracts associated with Major Defense Acquisition Programs from Fiscal Years 2010 through 2019, and (2) the factors that influenced the DoD’s decision to use fixed-price incentive contracts and the extent to which the DoD has assessed their use, among other objectives.