Traditional contracting methods focus on deliverables and work well when quality and effort can be clearly defined, but break down when outcomes depend on many factors. Next generation contracting instead purchases a relationship where funders and grantees work collaboratively to maximize results for customers, rather than predefined deliverables.

1. Next Generation Contracting
Quantity
EffectEffort
3. What we purchase in the lower quadrants are not deliverables,
but rather a RELATIONSHIP where funder and grantees work
together to maximize customer results.
WHICH MEANS
BUT
2. They break down in
the Is anyone better off?
quadrants (because of case mix
differences and perverse incentives).
1. Traditional purchasing
methods work fine in the
upper quadrants.
Quality