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Poll finds majority approval for PBR

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Posted on 3/09/2013 by Wayne Brophy FCILT

There is majority approval for using payment by results (PBR) when it comes to contract management – at least among a recently surveyed sample of buyers.

The publication Supply Management runs regular polls among people working in supply chain and purchasing jobs, according to its website.

In its most recent such poll, respondents were quizzed on their level of support when it came to PBR, and though 32 per cent came out against the system when it comes to contract management, they were in the minority. A much larger 68 per cent showed their support for this way of doing things.

One of the people taking part in the recent poll was conservation body the National Trust's procurement business partner, Dan Ware.

He was in favour of the system, explaining that it was vital that deals were agreed on, not imposed. That way everyone would be given a genuine incentive, he said. He also highlighted the importance of making sure results could be tracked accurately.

The news provider reports that think tank Social Market Foundation (a cross party organisation, according to its website), recently brought up concerns about plans for PBR to potentially be used when managing Ministry of Justice contracts.

In the Supply Management poll about PBR more generally, one person to come out against the practice was Richard Gane, a Vendigital supply chain specialist.

"Problems arise because the objectives of the supplier and customer become conflicting," he claimed when discussing PBR.

A customer will attempt to bring down price while a supplier will make efforts to maintain the contract's value, make as much money as possible, or both, he suggested.

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