CTRM IMPLEMENTATION
goal and incentivizes cooperation. As a caveat he warns, “Be careful what you bonus because there will be temptations to take short-cuts along the way. In addition to an objective, there must be quality parameters to guide the software delivery process. This is codified at Allegro as the ‘Foundation Methodology’.
The blame game is like a mud fight – there’s really no way to win On the other hand, negative
incentives don’t seem to work. Instead of focusing energies on achieving a common goal, resources are diverted to blaming and finger pointing. The blame game is like a mud fight. There’s really no way to win.
Good Faith Trust goes to the core of the
prisoners’ dilemma. The same is true of the service provider / client relationship. In the implementation context, trust is earned by sending signals that are hard to fake: Allegro’s
quick win, Navita’s pilot delivery or Baringa’s 25% fees-at-risk. ETRM legend Dick Couron says, “Trust requires an
understanding of the parties involved. The client needs a working solution and the service provider must make a profit. The single greatest threat to trust is scope creep. The scope, the acceptance criteria and a scope change mechanism must be clearly spelled out in the contract.”
The Secret Sauce
1. A bedrock of trust 2. Lots of small deliverables 3. Shared risk 4. Positive incentives
A contract does not in itself establish trust. But it does provide
a framework to enable trust to develop. Key to this flowering is the degree to which interests are aligned. A contract essentially allocates risk between the parties. Too much here and not enough there will lead to a suboptimal outcome. But there is a Goldilocks allocation where it’s just right. •
Larry Hickey is a Managing Director with Aneris XTRM and a frequent contributor to these pages. He has spent the past
14 years implementing industry-leading ETRM solutions. He is frequently called upon to turn around troubled projects.
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