GUARANTEED RELIABILITY USING INCENTIVES AND PENALTIES 630538
This paper describes the contractual formulation of a reliability test program which was applied to a number of electronic subsystems of the F-105 weapon system during their production phase. The contract itself contains certain incentive and penalty provisions; the reason for the development of this unique type of contract from among several possible approaches is discussed.
The many peculiar technical and administrative problems attendant upon such a program are enumerated and recommendations are made for solving them. Both the customer and the contractor give their individual points of view.
Finally, comments are offered on the probable use of reliability test programs and performance incentive contracts of this type for future system procurement.
At the time of this writing, February 1963, the program described is currently in progress. While it is premature to judge all program results, some important problem areas may be identified and discussed.