Logistics & Supply Management

Performance-Based Agreements


A Performance-Based Agreements (PBA) documents the negotiated and agreed-upon level of support and associated funding required to meet performance requirements. A PBA with the user states the objectives that form the basis of the Performance-Based Life-Cycle Product Support effort to meet operational requirements. They establish the negotiated baseline of performance and corresponding support necessary to achieve that performance, whether provided by commercial or organic support providers. The Program Manager (PM) has primary responsibility to establish and manage the support arrangements.


The Product Support Strategy (PSS) is designed to assure achievement of warfighter capability-driven life cycle product support outcomes documented in PBA.  It’s generally expressed in terms of weapon system material availability, reliability, and operations, and support cost affordability. The PSS should identify the execution plan to deliver integrated product support (IPS) elements to the warfighter, producing the best value balance of materiel readiness and total ownership cost.


Sustainment Metrics should provide the objectives that form the basis of the PBAs. The PBA performance metrics should reflect the highest level of metrics that are most critical in producing the desired performance outcome(s).


Contracting for performance-based logistics is a multiple-step process that can be applied to new, modified or legacy systems. The process is detailed on the web-based Performance-Based Agreement Toolkit as a best practice.


The following are the five stages in the PBA process: (see PBA Development Stages)

  • Stage 1: Evaluate Current Conditions
  • Stage 2: Gain Commitment to Proceed
  • Stage 3: Define Scope and Objectives and Finalize Agreement
  • Stage 4: Execute Agreement/Assess Results
  • Stage 5: Identify Improvements


Note: One important distinction between PBAs and other types of agreements is that PBAs contain the agreed to performance and/or sustainment metrics meeting the user requirements tied to funding. The others do not.


AcqLinks and References:

Updated: 3/16/2020

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