Contract directors need to understand the business environment and the government party's objectives in entering into the project deed. Performance measures lie at the heart of performance management. It is important that performance measures are linked to strategic objectives, or to desired outcomes. Understanding the business requires the contract director to have a good appreciation of the government party's service, its place in the broader service network (if applicable), the customers and other key stakeholders, the project deed (and other project contracts), the contract administration manual, the request for proposal, and the private party, including its contractual structure.
The contract director needs to identify those processes most critical to delivering business success. Doing so will create a clearer picture of what needs to be measured (which should be embedded in the project deed).