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Draft Report

Procuring, Managing, and Evaluating the Performance of Contracted TMC Services

performance goals?  What additional information do we need?  What data sources should be investigated?  These and other questions can be utilized to analyze the overall program of using contracted services, evaluate shortcomings, and identify solutions to address those shortcomings.  These activities could take place in-house, at the TMC management level, or they could be a collaborative discussion with the contractor.

A critical concept to understand is that even though Step 9 is the final step in the sequence, the program is an ongoing and iterative evaluation methodology.  This is perhaps best illustrated by the feedback arrows in Figure 8, which direct the user back to other steps in the program, depending on the needs.  If additional or corrective actions are necessary, the process returns to Step 2, to identify the goals and objectives.  If no changes are required and the process is working as planned, the outcome of Step 9 is to return to Step 1, where a new activity is examined and the cycle starts again.  Steps 1 through 9 will be repeated for all performance measures being considered or used in a contractual evaluation process.

Guidelines for an Effective Process

Over time the implementation of any performance measurement program is going to result in some efforts that are a resounding success and others that will be deemed a failure.  The key to a vibrant program is not to focus on the failures, but rather to use the successes to develop an agency specific “best practices” approach to performance measurement and using performance measures to evaluate the contracted services specific to the agency.

An agency specific best practices list can, however, take some time to develop.  Presented below are several items from the literature which can form the principles for a beginning best practices approach for an agency moving into the evaluation of contract services.

Utilize commercial / industry specific standards.

Consider having the contractor propose or provide input into measures.

Consider the use of incentive based contracts.

Use meaningful measures.

Regularly review performance.

While not every standard may be appropriate for determining performance targets, the use of standard language, terms, definitions, and data provides a meaningful method of comparing performance outside of the specific TMC.  Contractors may be able to provide additional expertise in this area, especially if they are familiar with standards efforts from other aspects of their business.  Contracts that are written from an incentive-based aspect can move the relationship more towards a partnership than simply a supplier of services.  If the incentives are cost-based, these types of contracts can have significant ramifications to the TMC budget,

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