- Development of Financial Models including solution development, work breakdown structures, estimating, open book cost models, pricing models and through life financial management.
- Development of Incentivisation Models to drive contractual performance, including Target Cost Incentive Fee (TCIF) and Gain Share / Pain Share mechanisms.
- Support your Open Book Management including development of Contract Obligations Matrices, Commercial Contract Management plans and Supplier Performance Management plans.
- Support your Contract Financial Management including design and implementation of financial reporting solutions, cost actual management, cash flow analysis, development and negotiation of payment terms and payment plans.
What is Open Book Contracting?
Open Book Contracting is a form of contract where the supplier and the customer operate in a partnered and transparent manner. Typically, the parties agree allowable costs and margin, and report the actual costs (and associated charges) through the life of the contract. It is similar to a “cost plus” contract.
Open Book Contracting is an effective way to drive commercial value for both contracting parties, and enables a contractual baseline for incentivisation models including performance and cost optimisation. Open Book Contracts support transparent and partnered ways of working, which, if managed correctly can provide great benefits to both parties.
The Private Sector and Public Sector both operate open book contracts, and these agreements contain provisions that encourage transparency, openness and honesty between customers and suppliers, and often include incentive based mechanism to link contractual performance to key performance indicators, such as reduced through life costs. Our experience and expertise in this specialist area can help you deliver for your customers and optimise the opportunities open book contracts offer your business.
Drive Value for Both Parties Through Partnered Behaviours
Effective management of open book contracts builds trust between contracting parties, enabling cultivation of fruitful business relationships. To enable effective Open Book Management it requires organisation, transparency and a deep understanding of the processes, work breakdown structure and cost drivers that relate to your contract.
Open Book Contracting offers the opportunity to add value throughout the project lifecycle, by demonstrating contractual performance and the tangible impacts on the bottom line. In order to support effective delivery, parties are required to mitigate risk and overspend, without affecting their ability to meet contractual obligations.
We have a strong background in Open Book Contracting and a dedication to transparency. We are experience in developing and delivering mutually beneficial agreements, which where properly managed and enabled, can bring huge benefits to both parties.
We can work with your business on:
Our ways of working and when to engage
If you are considering bidding for an Open Book Contract, engage with us at the start of the process to enable our maximum impact on the success of your bid and the value of the contract to your business.
If your project is already underway, timely specialist intervention could boost your success rate or final negotiated position, and ensure your bid is compliant and that your organisation can deliver the business you win.
We can provide consultancy and bespoke tools to your organisation, or can provide on-site consultancy over the life of the project. Our knowledge, expertise and tools will support the effectiveness of your commercial strategy.
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