Do you have sample contract language for incentive/disentive payments for
quality code in software development?

Hello Thechuckster,

There are a few sample contracts / sample clauses that appear to
satisfy your original question and the additional comment you made. I
was somewhat surprised at the lack of specifc on line materials on
this topic. My search for
  "sample contract" incentive "software quality"
provided only five hits on Google. The similar search with
  "contract clauses" incentive "software quality"
was a little better with only 43 hits. The sites listed below appear
to be the best of those hits along with some other sites I found with
some broader searches.

One of the best was from a government site at
  http://www.arnet.gov/Library/OFPP/PolicyDocs/pbscswdc.html
and repeated at a few other sites (I found a similar copy at the
National Institute for Health). In particular, the table near the end
has a number of suggestions. This is organized to address more than
one way to measure performance, compliance, and incentives / penalties
to be applied. Section 4 also addresses different types of development
efforts (e.g., modification, new software) and tailors the issues to
address based on project type.

Starting on page 20 of the following document:
  http://www.gov.nt.ca/FMBS/documents/dox/RFPtermsref.pdf
is a list of requirements in a table and requesting an assessment of
"compliance" with those requirements. This is for a specific RFP, but
you may consider some of these "as-is" or with modification for your
use. For each one, you should also consider what it means to comply or
not and identify incentives for those. This document does not include
specific incentives for performance.

Another site with some helpful material was the Telecommunications
Infrastructure Fund Board. The original file is missing, but the
Google cache at
  http://216.239.37.100/search?q=cache:VNiqKRYkv3UC:www.tifb.state.tx.us/Handbooks/wpword/Contract.doc+%22sample+contract%22+incentive+software+quality&hl=en&ie=UTF-8
and scroll to the bottom for sections on "How to Measure Value
Delivered" and "Sample Contract Outline".

A page titled "Marrel Legal Products" has a long list of questions w/
answers and sample contract clauses. None of them directly address the
issue of software quality, but several address price protection,
incentives, and intellectual property. The one on liquidated damages
may be one to consider using. Some of these may be adapted for your
use.

Another reference that may be helpful is
  http://www.badsoftware.com/qindex.htm
which is a site addressing issues with "Bad Software" in general. This
particular page focuses on legal aspects of software quality. Some of
the factors they address should be considered in your contract if you
find them important (e.g., liability for defective documentation,
outsourcing software testing). For example, if someone gets hurt as a
result of using the software - who has the liability?

In summary - these sites recommend:
 - a plan for measuring compliance with requirements
 - key requirements are specified in writting, ahead of time
 - measures established for the key requirements
 - address a broad range of issues (e.g., operational use, liability,
rights)
and perhaps best is to balance the work you do up front with the risk
you are taking on by selecting a supplier to develop a product that
your organization will use on a daily basis.

  --Maniac

Many of the sites you provided me were ones that I had already
visited.  I was looking more for specific contract language, not
outlines with explaination of the purpose of the contract clause.  I
really am looking for a "generic", if you will, general use contract
which can be customized easily, based on parameters measuring quality
software which further forms the basis for possible
incentive/disincentive payment/penality.  But, I'll take the more
difficult road and develop my own customized language from the
numerous 'this should be here" clauses.

I'm curious how you would define 'quality' in this context, as it
seems a bit subjective.  How do you judge the code, and on what
criteria?  Is it simply that it works and is "bug-free"?  Or does it
matter if it's maintainable?  Well-documented?  Following company
coding standards?  Does the performance speed of the code matter more
than the complexity of the algorithms used?

Given that there is always more than one way to write a particular
program, this may be difficult to pin down and thus somewhat
arbitrary.  (The disincentives would probably come into play more
often--essentially whenever a problem is found with the code).

While giving an incentive for good work is always a plus, judging the
value and quality of any given piece of software may well depend on
your particular slant and approach.

Regards,
duncan2-ga

Quality is always defined by the customer, or the consumer, which in
the case of contracts is the one paying the bill to receive the
product.  So, the real problem is not the pure definition of quality
but rather how to measure, given that the consumer can specify to or
jointly agree with, the producer what quantative measures are
appropriate.