Fixed Price with Economic Price Adjustment Contract Explained Fixed Price with Economic Price Adjustment Contract is a variation of the basic Fixed Price Contract (FP). In some of my previous articles, I have explained all the other variations of FP Contracts (as enumerated in PMBOK® Guide). In this article, I will talk about Fixed Price … Read more
Point of Total Assumption Formula in Fixed Price Incentive Fee Contract How do you remember any formula? Simple! Understand the concept you will not need to remember the formula. I heard about Point of Total Assumption when I was preparing for PMP® Exam. At the beginning, it sounded very funny. One of the meanings of … Read more
Incentive Calculation in a FPIF Contract In my previous post, I described Fixed Price Incentive Fee Contract (FPIF). In this article, I will discuss the formulas and incentive calculations for an FPIF Contract. Let me summarize the basic nature of the contract before getting into formulas and calculations. The basic nature of a FPIF Contract … Read more
Fixed Price Incentive Fee Contract Explained PMBOK® Guide defines 3 different types of Fixed Price (FP) Contract. I have written about Firm Fixed Priced Contract (FFP) and Fixed Price with Economic Price Adjustment Contract (FP-EPA) in other posts. In this post, I will talk about Fixed Price Incentive Fee (FPIF) Contract. You should also read the … Read more
Firm Fixed Price Contract Explained I have written a number of articles on different types of contracts. In some of my previous articles I have explained Fixed Price (FP) Contract. In this post, let me describe Firm Fixed Price (FFP) Contract. Even though FFP Contract is one of the sub-types of FP Contract but it is … Read more
Mathematical Orientation of Contract Types Procurement Management Knowledge Area of PMBOK® Guide defines 3 different Contract Types. I have already written two articles to explain these Contract Types. Contract Types explained through an Example Contract Types for PMP® Exam I have written this article to provide a completely different perspective to the Contract Types. This … Read more
Project Charter Definition, Meaning and Purpose A few years ago, I got an assignment to setup PMO for a small software services company. After understanding their business and organization structure, I advised them to start creating Project Charter (PC) for every project. I provided a brief overview of PC to the main stakeholders and gave … Read more
There are three different types of contacts in procurement management. These are: Fixed Price (FP) – also called as Fixed Fee or Lump Sum Time & Material (T&M) – also called as Unit Price or Rate Contract Cost Reimbursable (CR) – also called as Cost Plus In this article, you will find definition and explanation … Read more
In my previous post I gave a brief on Procurement and Risk. I deliberated upon who (buyer or the seller) has more/less risk in contract types. The post was written to help PMP aspirants answer some tricky questions reared to Risk and Procurement in the exam. The post can be read by following the below … Read more
Types of Contracts and Risk A Question You are working for a Defense Contractor. Your company is bidding for a Government’s secret project called Project “Hush-Hush”. The Government has decided to outsource this project as a Fixed Price Contract. Who has more Risk for this Project? Defense Contractor Government All Projects are risky. Both Defense … Read more