Contracts variability  

Structural Readiness to Respond

A business should be so structured that it should be able to respond to 'expected' and 'un-expected'. This includes methods related to optimizing operational break-even, managing contracts variability, managing contract exits, having modularity of investments & expenses, having 50% scenario readiness etc...


Contracts variability


The contracts with the Vendors, Service providers and channel partners should have easy variability where you can change the volumes and prices linked to certain environmental factors (whoever do not miss out for a long-term lock in if there is a good deal). The exit contracts should also not be having too much penalty. Apart from the volume, price and exit flexibility, one should also work on building variability on the service and product mix. You will never be able to achieve a 100% flexibility on contracts. The idea is to be sensitive to your business assumptions, anticipate the areas of possible change in future and work with your partners to be prepared for the same.