In the world of IT projects, we often hear about outdated budgets and exploded deadlines. While these slip-ups are explained by technological and operational factors, the very nature of the contract between the customer and the integrator plays a critical role — often underestimated.

The objective of a contract is to create a solid alignment between the two parties around a common goal: to deliver a quality solution on time, for a fixed budget. However, several traditional models have important limitations:

• Time and material : The customer assumes all financial risk. The integrator is, consciously or not, encouraged to extend the project. A client who is not very thorough in contract management will quickly see the scope (and costs) slip out of control.
• Fixed price : This model opposes interests. The integrator will seek to do the minimum to maximize its margins, while the customer will require the maximum for the minimum cost. This misalignment almost inevitably leads to tensions and conflicts.

Risk sharing: a win-win alignment of interests

The risk-sharing contract is, in my experience, the most effective approach to sustainably align the goals of the client and the integrator.

Here's how it works:

• The scope of the project is clearly defined from the start.
• Assumptions and responsibilities are documented in detail.
• The integrator provides a solid estimate of his fees, defining a Target.
• A contingency range is set:
  • Overtaking : the integrator is penalized.
  • Economy : the integrator is rewarded with a bonus.

In other words, the integrator shares the risks... but also the potential gains. This model encourages effective delivery in a climate of collaboration rather than confrontation.

Experience shows that projects under risk-sharing contracts achieve superior results — both for the client and for the integrator.

Do you want to know more about setting up a risk-sharing contract for your IT projects?
Do not hesitate to contact me.