The 411 on Outcomes Based Contracting
When we’re hired for a new job, we often sign an agreement detailing the obligations we must meet and, if we fall short, the potential consequences. Depending on our industry, our contracts may also include performance bonuses for achieving specific metrics. It makes sense. If we put in the work and get results, we're compensated accordingly.
So, why does the same practice not always apply in the education sector? Stanford’s SCALE Initiative notes school systems “invest enormous resources in external vendors for educational products and services.” However, more than two-thirds of these agreements lack “key details and provisions that promote performance and accountability.” That’s why outcomes based contracting is a game changer. In the Q&A below, Courtney Lincoln, VP of impact, explains more about the innovative model, now being implemented in Arkansas with Forward’s support.
Let’s start with the basics. What is outcomes based contracting?
Outcomes based contracting is a model that’s designed to promote mutual accountability with both sides—districts and service providers—defining and agreeing to detailed metrics before either signs on the dotted line. With these contracts, a substantial part of the payment, at least 40%, is dependent on the provider delivering results. Districts only pay the full value when students demonstrate meaningful progress. Similar to a performance bonus, districts can also build in incentives for the vendor to encourage quality and innovation in pursuit of the metrics.
How is Forward empowering districts to pursue these types of innovative contracts?
Forward is committed to empowering great teachers and leaders to create and scale innovative solutions to enhance student learning. That’s exactly what outcomes based contracting aims to do. Earlier this fall, Forward became a national leader with the launch of the first state-based outcomes based contracting cohort, focusing on high-impact literacy tutoring. Commonly known as HIT, this intervention occurs during the school day in one-on-one or small group settings three times a week for 10+ weeks from a consistent, trained tutor. If implemented properly, HIT has been shown to help accelerate learning by three to 15 months.
What districts are in Forward’s outcomes based contracting cohort?
Participants include Arkadelphia Public School, eStem Public Charter Schools, Hamburg School District, Little Rock School District and Texarkana Arkansas School District.
What’s next for Forward’s OBC state-based cohort?
With Forward’s support and in partnership with the Center for Outcomes Based Contracting, the cohort has designed outcomes based contracts for their students’ and districts’ unique goals. Now in the implementation phase, we will continue to work alongside their teams to help them measure the impact on student outcomes and identify areas for continuous improvement. The end-goal is to replicate the model in other districts across the state.
Do you have additional questions about outcomes based contracting? Email clincoln@forwardarkansas.org and follow along with our cohort’s progress on Facebook.
