Use of Incentives in Performance-Based Logistics Contracting: Initial Findings
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Performance-based logistics (PBL) contracts, which have been used by private industry for decades, (particularly in the airline industry as a way to manage complex fleets) have only relatively recently begun to be used in the public sector worldwide. Research on PBL application indicates that PBLs can be successful in lowering costs and improving performance in both government and private contracting. In both cases, PBL contracts depend on the ability of the customer to properly structure and implement contract incentives to promote vendor behavior that reduces costs and improves performance while delivering the customerﾒs desired outcomes. This report examines how such incentives are used in PBL contracting and looks further towards how incentives can best be utilized in a PBL contracting environment. This report is structured in three parts: a review of the available literature on the use of incentives in PBL contracting, a data analysis of where and how PBL contracts are used in the DoD, and a summary of initial findings from the experts CSIS has interviewed on the subject.
NPS Report NumberSYM-AM-17-052
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Hunter, Andrew; Ellman, Jesse (Monterey, California. Naval Postgraduate School, 2017-03); SYM-AM-17-106Performance-based logistics (PBL) contracts, which have been used by private industry for decades, (particularly in the airline industry as a way to manage complex fleets) have only relatively recently begun to be used in ...
Venable, Timothy B. (Monterey, California. Naval Postgraduate School, 2000-12);The purpose of this thesis is to provide the reader with the ability to analyze the effectiveness of incentives and to document innovative approaches to incentive contracting that can be applied to Cost-Plus-Award-Fee ...
Basaran, Ismail Zafer (Monterey, California. Naval Postgraduate School, 1994-06);The end of the cold war caused defense budgets to decrease in sharp manner. This trend requires the Navy, as a branch of the DOD, to tighten its controls over spending and become more cost-effective. Since warship procurement ...