General Discussion
In reply to the discussion: Any time you hear the word "privatization", you should be scared [View all]jody
(26,624 posts)has been changed but generally retains the adjectives "performance based".
It has been used successfully thousands of times and misused also.
The concept is based on one of the three items that each federal contract must address; cost, schedule, and performance.
Performance is the most difficult to monitor during a contract and requires the government have precise standards for the product or service to be provided by the contractor.
Those three factors are the basis for "earned value management" that has proven successful for managing contracts for which performance can be tracked.
Obviously there is much more than that but I've followed the idea from its inception in 1978 and observed many successes and several abysmal failures. The latter always associated with the government being unable to define the standards for the product or service to be produced.