It matters to an organisation, whether a buyer or supplier, that appropriate contracts are used. There are specific conditions that determine the appropriate choice of contractual relationship. These conditions include the production processes used by the buyer and supplier. Certain contract types are best suited to specific production processes. Therefore, misalignment of contract type diminishes the core competencies of the organisation, consequently its competitive advantage, and its economic value.
Strategic Economic Relationships: Contracts and Production Processes provides practical guidance in the form of:
A framework to distinguish different contract types, and Analytical tools to determine the appropriate contract type for the specific conditions facing the organisation.
Examples are drawn from the private and public sectors especially as applied two the construction and infrastructure, and information technology/management sectors — sectors characterised by their complex production processes.
The framework and analytical tools have their foundations in economic, and production/operational management literature and practice.
