Using a Performance Point Model for Your KPI “Incentive” Scheme

There are several approaches to setting key performance indicator (KPI) incentives in outsourcing arrangements. The term “incentive” is used in this Executive Update to reflect the financial risks and rewards that are allocated to the service provider by the client regarding KPIs. Incentives over the provider can be negative (risk)and/or positive (rewards). Such incentives encourage providers to meet expectations and, where desired, to deliver outstanding service.