Cpif: The New Look in R and D Management (Classic Reprint) - Hardcover

Inhaltsangabe

Excerpt from Cpif: The New Look in R and D Management

This is not to imply that the establish ment of the cost-fee relationship is a simple matter. Several points must be considered. First, the customer cannot expect the sup plier to assume the infinite risk implied by not setting a minimum fee. Thus, a cost point must be reached beyond which the customer agrees to assume all costs if he desires work to continue. Second, there is some cost point below which the fee can not continue to grow, since by law fees are limited to 15% of target costs. This same legislation also demands the setting of a target cost (obviously between the costs corresponding to the maximum and mini mum fee points). It is at this target cost that the target fee (rather, that the portion which is dependent upon project cost) is to be awarded. These three figures: target cost, minimum fee cost, and maximum fee cost, along with the chosen target, and maximum and minimum fees, form the starting points for one method of establish ing the fee-cost relationship.

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