Contract Management Academy · Interactive Learning Tool

Contract Type Selector

Explore how scope clarity, uncertainty, flexibility, risk transfer, economic price volatility, incentive needs and buyer oversight affect the suitability of common contract types.

  • Manipulate commercial conditions directly and watch the contract-type suitability scores change immediately.
  • Compare six contract forms: FFP, FPIF, FPEPA, T&M, CPFF and CPIF.
  • Progress through eight locked learning stages before applying the model independently in Experiment Mode.
Demonstration Overview

Use commercial conditions to explain—not merely label—the contract choice.

The guided demonstration starts from a balanced procurement scenario, then progressively changes the factors that make different contract types more or less suitable. The highest score is a decision aid, not an automatic legal or procurement determination.

Scenario Specialist digital-services procurement with a mix of defined deliverables and implementation uncertainty.
Decision Select a contract family that balances price predictability, flexibility, incentives and administration effort.
Technique Multi-factor suitability analysis with sensitivity testing.
Learning Principle Manipulate → Observe → Explain → Challenge → Recommend.
Guided Demonstration

Contract Type Selection — Step by Step

Eight locked stages move from contracting context through direct manipulation of the commercial factors, sensitivity testing and a management recommendation.

Current Stage 1 of 8
Leading Contract Not assessed
Progress Establish context
Learning stages
Foundation Stage 1 of 8

Establish the Contracting Context

Current instruction
Interactive Contract Selection Dashboard

Contract Type Suitability

Reveal the contracting context to begin.

100%
Selector status: Establish the contracting context.
Interpretation

Understand what pushes the recommendation toward each contract family.

Fixed-price structures become stronger when...

  • scope and acceptance conditions are clear;
  • technical and cost uncertainty are manageable;
  • the buyer values price predictability and risk transfer;
  • the seller can reasonably estimate the work.

Cost-reimbursable or T&M structures become stronger when...

  • the work is difficult to define completely before award;
  • uncertainty and iterative discovery are material;
  • flexibility is more important than firm price commitment;
  • the buyer can provide stronger cost and performance oversight.

FPEPA becomes stronger when...

The scope supports fixed pricing, but specified economic factors—such as inflation, commodity indices or labour escalation—could move significantly during performance.

Incentive forms become stronger when...

The parties can define measurable cost, schedule or technical targets and want fee/profit outcomes to reinforce desired performance.

Experiment Mode

Build Your Own Contracting Scenario

Experiment Mode is isolated from the guided demonstration. Change all seven factors freely and observe how the suitability profile responds.

Check Your Understanding

Quick Knowledge Check

Choose an answer, then check it.
Quick Reference

Contract Type Selection Cues

FFP

Best fit when scope is clear, uncertainty is manageable and the buyer values firm price/risk transfer.

FPIF

Useful when fixed-price discipline is feasible and measurable incentives should influence seller performance.

FPEPA

Useful when scope supports fixed pricing but specified economic factors may change materially during performance.

T&M

Useful for uncertain or evolving work where labour/material usage can be controlled and closely monitored.

CPFF

Useful when uncertainty makes firm pricing impractical and the buyer accepts more cost risk without a performance incentive structure.

CPIF

Useful when uncertainty requires cost reimbursement but measurable incentives can align cost or performance behaviour.

Key Takeaway
Choose the contract type that matches the commercial reality of the work.

A good selection balances scope definition, uncertainty, change expectations, risk allocation, market conditions, incentives and the buyer’s ability to administer the contract. The best contract type is not the most familiar one—it is the one that fits the actual procurement situation.