Collaborative contracts for inter-organisational quality systems

Purpose - The purpose of this paper is to demonstrate that collaborative contracts enable interorganisational quality systems. Design/methodology/approach - The research compares performance contracts with collaborative contracts, a new contract type whereby the contract parties align their objectives. The study uses game theory and describes the contract types as mechanism designs for comparison. The mechanisms are validated with a case study. The utility of the contract types is verified with Monte Carlo simulations using expert opinions. Findings - The research demonstrates that, under certain conditions, collaborative contracts enable inter-organisational quality systems by facilitating the exchange of information between the contract parties and investments in inter-organisational work processes. Practical implications - The use of collaborative contracts between an operator of a technical system and a maintenance organisation leads to improvements in inter-organisational work processes, reducing maintenance costs and improving the availability of the technical system; thereby increasing the utility of all contract parties. Originality/value - The collaborative contract is a new contract type for maintenance services and the research method provides a new approach to enable inter-organisational quality systems.