Anything you say will be held against you Agile Contracts

Anything you say Agile Contracts

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2. After all … We are in Washington DC

3. Jagdish Karira

4. Why Contracts?
Why Agile Contracts?
Approach and Execution
Takeaways
Contract Types
Which Contract Is the Right Contract?
Learning Outcomes

5. https://agilemanifesto.org/

6. Procurement
Vendor Management
Office of General
Counsel/Legal
Sourcing
Risk Management

7. No Contracts No Money
Contracts negotiations are more important than Customer Collaboration
They have hope in hell getting anything done without my signature
Let it be stricken
“Do As I Say Not As I Do . . . Because I said so”
Reactions from Procurement Sourcing
Vendor/Risk Management Legal?

8. Legal agreement
Establish rules of engagement
Protect Intellectual Property (IP), Trademarks, and Patents
Highlight terms, conditions, and expectations
Protect against risks (Bankruptcies, Security Breaches, and Disputes etc.)
Provide assurance/confidence and satisfaction to all parties
Ensure confidentiality / non-disclosure agreement (NDA)
Enable overall compliance and adherence to legislation
Make all parties accountable
Why Contracts?

9. Time, Materials, and Expenses Contracts
Time, Materials, and Expenses with a Cost Ceiling Contracts
Bonus and Penalty Clauses Contracts
Pay by Story Point
Fixed-Profit
Fixed-Price, Value Delivery Contracts
Time, Materials, and Expenses with Fixed Scope and a Cost Ceiling Contracts
Fixed-Price, Fixed-Scope Contracts
Multi-Phase Contracts
Types of Contracts?

10. When the problem is highly
complex may require innovation
Client owns the scope and
drives the engagement
Variable scope
Potential for extension with
contract type variation
Client owns financial and
delivery risks
No incentives for
accountability

11. .
Client owns the scope and
drives the engagement
Cost ceiling limits the
scope
Potential for extension with
contract type variation
Client owns financial and
delivery risks
No incentives for
accountability
When the problem is highly
complex requires innovation with
limited budget

12. .
Client owns the scope and
drives the engagement
Cost ceiling limits the
total revenue
Potential for extension with
contract type variation
Vendor owns financial and
delivery risks
Vendor is
accountable for
scope within cost
When the scope is fixed and the
budget is limited

13. .
Vendor is rewarded if delivers
early
Vendor pays a
Penalty if delivers late
May not be suitable for
innovative work
Vendor owns financial and
delivery risks
Vendor is
accountable for
scope within cost
and time
To meet critical deadline for
fixed scope when delays might
not be an option

14. When clients know exactly what
they want
Clients like fixed price projects
because that gives them security
Fixed scope and Fixed
price
Potential scope changes are
governed by Change
Requests
Vendor must estimate work
carefully
Earlier finish provides better
profitability for the vendor

15. When clients know exactly what
they want
Clients like fixed profit contracts
because that gives them security
Vendors like fixed profit
contracts because of
guaranteed profit
Potential for extension with
contract type variation
Client owns financial and
delivery risks
No incentives for
accountability

16. When clients want flexibility to
prioritize based on the value
Clients like fixed price contracts
because that gives them security
Clients reserve the
right to prioritize and
swap features of
higher value with
features of lower value
Potential scope changes are
governed by Change
Requests
Vendor must estimate work
carefully

17. When clients know exactly what
they want and vendors are
certain of delivery
Clients like pay by story points
contracts because of simplicity
Vendors like pay by story
points contracts because of
predictability
Potential for extension with
contract type variation
Client owns financial and
delivery risks
Vendor may inflate
estimates for profitability

18. Longer Term commitments for
delivery of complex systems
Funding cadence for quarterly
value delivery
Inspect and Adapt based on
outcomes
Limited risk
Enables experimentation
Flexibility to negotiate
contract type/arrangement

19. Collaborative ownership over
punitive accountability
Simplicity over complexity
Think of contracts as Win-Win,
NOT Levers or divisive
instruments . . . US vs. THEM
Tangible outcomes over
deliverables
Adaptive partnerships over
contract-driven relationships

20. @jagdishkarira
www.linkedin.com/in/jagdishsk