SSON — July 2014

Next in the” Vitasek on Vested” series for SSON: Don’t Fall into the Activity Trap There are many “perverse incentives” in buyer-supplier relationships that can disrupt or even doom outsource relationships, but perhaps none of them are as perverse and downright dangerous as the one I call the Activity Trap… Published online on 22 July […]

Information Week — July 2014

Suppliers Held Hostage To Procurement Platforms, Services Commentary by Kate Vitasek in IW’s Strategic CIO published 14 July 2014 Pricing models penalize suppliers for increasing their business with retail, other customers… link: http://www.informationweek.com/strategic-cio/executive-insights-and-innovation/suppliers-held-hostage-to-procurement-platforms-services/a/d-id/1297246  

Paying for Performance in the Legal Profession

About one year ago I wrote about a common problem in the legal profession—overbilling—as a prime example of the Activity Trap. It was a frightening example of “billable hours” gone bad and becoming a perverse incentive at a major law firm. So I was really pleased to read an article in the ABA Journal about […]

Billable Hours and Perverse Incentives

Those who know me or the Vested business model know the importance of Rule #1 – an Outcome vs. Transaction Based Business Model. Transaction-based business models create perverse incentives because they encourage an ailment I call the activity trap. In my speeches and classes I use the example of a rat on a treadmill when […]

Dilbert Nails the Activity Trap

Monday’s Dilbert cartoon has a pitch-perfect take on one of the common problems that occur in outsourcing agreements, something that  I call the Activity Trap.   “I don’t want you to be more efficient. You’re working on a government contract and billing by the hour.” That in a nutshell is the Activity Trap. But it’s […]