Is your service contract not getting the results you want? Contract theory may help!

Have you ever wondered why your services contract is just not working properly?  Why the incentives you put in the contract are not delivering the desired outcome? The reason is most likely due to an area of study called contract theory and this year, the Nobel Memorial Prize in Economic Science was awarded to the economists Hart and Holmström for the development of contract theory.

These prize-winning economists have provided valuable theoretical tools for understanding real-life contracts as well as potential pitfalls in contract design.

Is there something we can learn from this as contract owners and apply to services contracts? At Acquire, we think so.

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Can Safety be bought in Mining Services Contracts? Beware the Cobra Effect

Mining safety has come a long way in Australia and now is at a point where the safety cultures of some of the Australian miners are considered leading practice in the world. As mining operators continue to improve productivity and reduce their bottom line, mining services providers remain paramount for delivering business outcomes.

One common question we get from our operator clients is What should be done to ensure Safety is paramount in a Mining Service relationship? What are the roles of the supplier and the operator and what’s the best way to promote a safety culture when designing the mining services contract?

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