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Performance-Based Contract (PBC)

Performance-Based Contract (PBC) shifts the focus from activities to measurable outcomes, linking performance to the results that matter.

Explore PBC
Watch PBC Overview

Performance-Based Contract

Real Results. Measurable Impact.

Performance-Based Contracting (PBC) helps Government agencies achieve better outcomes by focusing on performance, reliability and value. Working with ministries, agencies and strategic asset owners, TDA supports PBC initiatives across multiple sectors and public services.

These success stories highlight how PBC is applied to support operational performance, accountability, asset readiness and greater value from public investment.

PBC Impact Stories

Explore Impact Stories

Discover how Performance-Based Contracting (PBC) is helping Government agencies improve performance and deliver measurable value.

What PBC is

Performance-Based Contract (PBC)

Performance-Based Contracting (PBC) focuses on outcomes rather than activities. Instead of simply measuring the work performed, PBC measures whether agreed performance outcomes are achieved.

This approach aligns contractual performance with agreed standards, helping improve the reliability of services, assets and infrastructure while delivering greater value from public expenditure.

The Difference, Simply Explained

Traditional contracts

Traditional contracts pay for activities performed.

Performance-Based Contract

PBC pays for the results achieved.

For example, instead of paying for a fixed number of maintenance visits, PBC focuses on whether the asset remains available, reliable and fit for purpose.

Watch the video

Understanding the Performance Based Contract (PBC)

Watch this short introduction to discover how PBC shifts the focus from activities to outcomes. Instead of measuring what is delivered, PBC measures how well services perform against agreed targets and expectations.

Learn how this approach helps improve operational efficiency, enhance service quality, optimise costs and ensure better value throughout the lifecycle of assets and infrastructure.

How PBC Works

A Structured Framework for Better Outcomes

PBC follows a structured process to define outcomes, establish performance measures, monitor delivery and continuously improve results.

01

Plan

Define desired outcomes, performance targets and contract requirements.

02

Develop

Establish the Performance Management Framework (PMF), including KPIs and performance standards.

03

Implement

Deliver services and manage performance against agreed requirements.

04

Monitor

Track results through performance measurement, reviews and reporting.

05

Review

Evaluate results, identify improvements and refine future performance requirements.

Continuous Improvement

Real Results. Measurable Impact.

PBC Measuring Performance

How Success is Evaluated

PBC uses different levels of performance measures to provide a balanced view of contract performance, from operational readiness to strategic outcomes.

SHI

System Health Indicators (SHI)

Monitor the underlying conditions required to support effective performance.

Readiness

Compliance

Resource availability

KPI

Key Performance Indicators (KPI)

Measure performance against agreed service levels and targets.

Asset availability

Service response times

System uptime

SPM

Strategic Performance Measures (SPM)

Measure broader strategic outcomes and the long-term value delivered.

Operational effectiveness

Stakeholder confidence

Strategic objectives achieved

Together, SHIs, KPIs and SPMs provide a balanced view of performance, connecting operational readiness, service delivery and strategic outcomes.

PBC Benefits and Impact

Delivering Value for All Stakeholders

Performance-Based Contracting (PBC) aligns outcomes, performance and accountability to create value across the public sector ecosystem.

01

Ministries

Greater value from public expenditure, stronger accountability and clearer alignment between spending and outcomes.

02

Government Agencies

Improved asset availability, reliability and service performance through clearly defined performance outcomes.

03

Service Providers

Clear performance expectations, stronger collaboration and incentives linked to measurable results.

PBC Strategic Partners

Trusted by Ministries and Agencies Across Malaysia

PBC has been implemented across a wide range of sectors, supporting strategic assets and critical public services nationwide.

Kementerian Kewangan Malaysia Kementerian Kewangan Malaysia
Jabatan Perdana Menteri Jabatan Perdana Menteri
Kementerian Pertahanan Malaysia Kementerian Pertahanan Malaysia
Markas Angkatan Bersama Markas Angkatan Bersama
Tentera Darat Malaysia Tentera Darat Malaysia
Tentera Laut Diraja Malaysia Tentera Laut Diraja Malaysia
Tentera Udara Diraja Malaysia Tentera Udara Diraja Malaysia
Pasukan Udara Tentera Darat Pasukan Udara Tentera Darat
Kementerian Dalam Negeri Kementerian Dalam Negeri
Polis Diraja Malaysia Polis Diraja Malaysia
Pasukan Gerakan Udara, Polis Diraja Malaysia Pasukan Gerakan Udara, Polis Diraja Malaysia
Pasukan Polis Marin, Polis Diraja Malaysia Pasukan Polis Marin, Polis Diraja Malaysia
Agensi Penguatkuasaan Maritim Malaysia Agensi Penguatkuasaan Maritim Malaysia
Jabatan Bomba dan Penyelamat Malaysia Jabatan Bomba dan Penyelamat Malaysia
Jabatan Pertahanan Awam Malaysia Jabatan Pertahanan Awam Malaysia
Jabatan Imigresen Malaysia Jabatan Imigresen Malaysia
Jabatan Pendaftaran Negara Jabatan Pendaftaran Negara
Jabatan Kastam Diraja Malaysia Jabatan Kastam Diraja Malaysia
Jabatan Akauntan Negara Malaysia Jabatan Akauntan Negara Malaysia
Kementerian Pengangkutan Malaysia Kementerian Pengangkutan Malaysia
Jabatan Pengangkutan Jalan Jabatan Pengangkutan Jalan
Civil Aviation Authority of Malaysia Civil Aviation Authority of Malaysia
Railway Assets Corporation Railway Assets Corporation
Kementerian Kesihatan Malaysia Kementerian Kesihatan Malaysia
Jabatan Kesihatan Negeri Pahang Jabatan Kesihatan Negeri Pahang
Kementerian Perumahan dan Kerajaan Tempatan Kementerian Perumahan dan Kerajaan Tempatan
Jabatan Pengurusan Sisa Pepejal Negara Jabatan Pengurusan Sisa Pepejal Negara
Jabatan Digital Negara Jabatan Digital Negara
Radio Televisyen Malaysia Radio Televisyen Malaysia
Performance-Based Contracts: Paying for Outcomes, Not Activities

Create better outcomes

Let’s Create Better Outcomes Together

Every organisation seeks reliable services, better use of resources and greater value for the people it serves. Performance-Based Contracting provides a structured approach to turn these priorities into measurable outcomes.

Connect with Our PBC Team

Whether you are planning a new contract or managing complex assets and services, TDA can help you explore how PBC can support your organisation’s objectives.