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Old 07-27-2012, 09:49 PM
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Default Cost controls over the life of the contract

I would be interested to hear people's ideas on innovative measures they have implemented to control costs over the life of a contract other than a CPI which allows costs to increase but caps at an agreed rate.

I find too often that procurement focus on savings that can be associated with the RFP for example, an intial reduction on historical spend or a reduction from the initial bid received versus the final bid. I would like to implement to focus more on things such as, gainsharing schemes, annual cost reduction targets, performance incentives and penalties etc. Does anyone have good examples of these or do you know of other ways to achieve this bearing in mind our spend is mainly for services.

I would be happy to share my email address if people would be kind enough to share contract language also.

Thank you
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