School districts are no stranger to evaluations, whether it’s assessing its students, teachers, or administrators, performance reviews are a standard procedure in k12 school districts.
Education technology saw a huge surge in usage during and after the pandemic, but it was ironically left out of any kind of systematic evaluation. This left stakeholders to question the efficacy and impact of these technologies on student outcomes through their own standardization.
Though more common in private sectors and government services, outcomes-based contracts are relatively new in K12 education. Outcomes-based contracts link payment to vendors to specific, measurable outcomes rather than service delivery alone. In other words, EdTech solution providers don’t get a bulk of their payment until districts see results. These contracts help districts to have more confidence and security in their investments that directly contribute to student performance improvements.
Outcomes-based contracts focus on achieving specific, measurable results, which encourages vendors to deliver on their promises and directly benefit students. These contracts can lead to improved resource utilization and enhanced accountability for vendors and school districts, but they do come with their own set of challenges.
For K-12 district administrators, shifting to outcomes-based contracts means changing how they usually buy and implement school services and products. This is no small task, considering that procurement processes are already complex and time-consuming. However, precisely because so much effort goes into these processes, it makes sense to use outcomes-based contracts. By doing so, when administrators finally choose a service or product, they can be more confident that their investment will truly pay off (or not, in which case districts won’t have to pay) in terms of actual educational outcomes.
Typically, the most competitive bids come at a lower price tag, but price can’t be the only factor when making outcomes-based contracts. District leaders need ongoing evaluation and adjustments based on performance data–which is an additional job responsibility. That’s not to say it wasn’t before, but to initiate any type of results-oriented contract, district admins must have robust data collection and analysis systems in place.
Curriculum directors and superintendents must be able to handle and analyze large data sets, a process that is essential but time-intensive. A recent Stanford Student Accelerator report identified that while outcomes-based contracts improve teamwork and engagement, they also demand greater collaboration between procurement and academic departments—an increase in workload that not all districts may be ready to handle. The necessary infrastructure needs to be capable of precisely tracking, measuring, and reporting on metrics that are critical to the outcomes of these contracts. Lastly, district administrators must prioritize data-driven decisions and remain flexible to renegotiate contract terms to meet evolving objectives and challenges.
Use the following considerations with Outcomes-Based Contracts:
This can be challenging, but vendors and districts need to agree on what "success" means. For example, if districts say success is raising test scores, how much should scores go up to be considered a success? Be sure to consider variables that can also affect students' scores.
The data needs to accurately show how much students are learning. This means the data should reflect true learning, not just good test-taking skills or extra help from outside the classroom.
The tech used in schools doesn't unfairly help or hurt certain groups of students. For example, students from economically disadvantaged families might not have the same home resources as others, which could make some tech seem less effective than it really is.
Technology might show quick results in improving grades, but we need to check if these improvements last over time.
Bringing in new tech means teachers might need to change how they teach and might even need new training. This can be a big task that requires time and money.
Dr. Scott Muri of the Ector County Independent School District in Texas saw firsthand the benefits of outcomes-based contracts. Under these contracts, the district spent $12 million on virtual tutoring services, with payments tied to student performance improvements. Every vendor's goal was to improve student outcomes; however, only those whose services led to significant student progress received full payment. Other vendors, falling short of their targets, earned less. This approach fostered accountability and demonstrated a direct link between vendor payments and actual education gains. It’s setting a precedent for future contracts to focus on tangible results. Dr. Muri advocates for this model, and he believes it encourages better service delivery and accountability from vendors.
Sparkrock 365's ERP can support districts in managing the complexities associated with outcomes-based contracts. Here’s how:
| ERP Support | Benefit |
| Data Management & Reporting | Centralized data management facilitates easy access and analysis of information related to vendor performance and contract compliance. This supports data-driven decision-making and simplifies the monitoring of contract metrics. |
| Procurement Process Efficiency | RFP stage to final vendor selection, the ERP streamlines workflows, automates approval processes, and supports compliance with district policies. This reduces administrative burden and accelerates the procurement cycle. |
| Financial Oversight and Budget Management: | By integrating the ERP’s budget management tools, the system provides real-time financial data so districts can manage budgets effectively and align spending with performance outcomes. |
| Vendor Management and Evaluation | Creates a seamless vendor management with onboarding, performance reviews, scheduling, etc. This builds transparency and accountability in vendor relationships. |
Outcomes-based contracts could be the solution to help British Columbia (BC) school districts tackle important challenges.
BC has an opportunity to lead the way in making school learning better by using lessons from international examples of outcomes-based contracts. Through collaboration, school districts and vendors can find common ground in delivering impactful solutions to student achievement.
By using outcomes-based contracts, BC can make sure that the money spent on education really leads to better learning and results in schools. This method makes companies work in line with what the schools need to support education standards across the province.
Despite BC schools getting more money over the years, students' scores in subjects like math and reading haven't improved. This shows that just adding more money isn't enough. BC districts need to consider how to use the money differently to improve student performance.
Outcomes-based contracts could be the solution to solving this. These contracts offer BC districts reassurance that money spent actually helps students do better in school.
Outcomes-based contracts require school districts to rethink how they evaluate and use vendor solutions. While setting up these systems is important, the main goal isn't just to implement a new product. It’s to make sure that these investments lead to tangible improvements in how schools operate and support their students.
The integration of ERP solutions in managing outcomes-based contracts is a shift towards more strategic, accountable, and results-focused procurement in K12 education. Sparkrock 365’s capabilities enable districts to operate with greater precision, agility, and responsiveness. So district investments in education are both measurable and meaningful.
Ready to see how Sparkrock 365 can support your district's approach to procurement? Visit our website to learn more about our solutions and schedule a demo today. See how strategic investments can lead to tangible improvements with Sparkrock 365.