Most large services contracts are tendered well, signed, and then managed to the letter — and still drift away from the commercial deal you thought you bought.
Drift isn't a breach. It's the slow gap between what the contract was originally meant to deliver and what your operation now gets.
There's a cost-out target, and a large services contract is an obvious place to look — but you want to know what's really there before you touch it.
The contract is underperforming enough to cause real pain — cost, output, or a relationship that's gone sideways — and re-tendering feels like a blunt instrument.
You're establishing or re-tendering an arrangement and you don't want to rebuild the problems the last one had.
The contract stays compliant — rates honoured, reports filed, obligations met — but what you get for what you pay, per unit of output, moves the wrong way. Often it's volume, not price: you end up paying for more and more units to do exactly the same job, while the rate barely moves. On paper, nothing is wrong. In the P&L, something is.
And it's the kind of drift you don't see. No one is watching cost per unit of output as a trend, and month to month it hides in the noise — some numbers up, some down — because the reports were never built to surface it. So it compounds quietly, unflagged.
On one contract this drift was ~$21M a year — about half the cost — and re-tendering hadn't touched it.
The deal still performs as signed, but the reason you outsourced has gone. You outsourced for a capability you didn't have yet, capital you wanted to preserve, or a proven operator you needed to get the project funded. Years on, you've built the capability, the capital position has changed, the project is running — and the premium you still pay buys something you no longer need.
This is also where the question becomes: should this still be outsourced at all?
Drift isn't a rounding error. On top of the 3–5% rate rise you negotiate and can see each year, cost per unit of output typically creeps another 5–10% a year on top — and that part no one is watching.
These contracts run for years — usually longer than any one contract manager's time in the seat, or any one procurement team's window of oversight. Left unwatched, that compounding quietly doubles the cost per unit of output over the life of the deal.
By the time anyone asks, it's been written off as inflation, or "the operating environment changed" — the mine got deeper, the haul got longer. Sometimes that's true. Often it isn't: it's drift no one was set up to see.
Part of the problem is how the number gets read. Most teams look at cost per unit of output month to month — and in a mining operation that figure swings hard from one month to the next: grade, weather, pit sequencing, planned shutdowns and campaign changes all move it. Any single month tells you little, so a slow, steady drift just disappears into the noise.
Smooth the same data over a longer window — years, not months — and the trend that was invisible month to month shows itself.
An agreement only delivers if both sides operate inside it. Under day-to-day pressure, the way work actually gets called off and run can drift from what was agreed — on either side. When that happens, the commercial model goes out of whack and the supplier usually gets the blame for it.
It's rarely anyone's fault; it's what happens when a deal built for ideal conditions meets a real operation. Naming it calmly is often what ends the finger-pointing — and it's the kind of thing only an independent set of eyes can say.
Your results ride on the contractor's performance. When they drift, your numbers drift.
They set the ceiling on what you can produce. When they drift, your output is capped no matter what else you do.
Most of these arrangements are designed for ideal conditions — assumed volumes, clean scope, a tidy operating environment. Reality is never that tidy.
When the gap shows, people start attributing blame — to the supplier, or to each other — when often the design was structurally flawed from the outset. No one got it wrong on the day; the assumptions just didn't survive the real operating environment. Recognising that is the first step to fixing it.
Re-tendering attacks the rate; switching suppliers changes the logo. But when the drift sits in the commercial model — how volume, scope and incentives are structured — neither touches it.
On one contract, both had been tried and the cost stayed; the model was the problem. The answer is a commercial reset, not a procurement reflex.
Left alone, drift compounds quietly until a trigger forces the question — a renewal, a cost-out mandate, a board asking what's driving the number. We quantify the exposure and reconcile it to the P&L, so the answer is defensible.
We quantify exposure and recover value; we don't promise guaranteed savings.
Start with the contract you're least sure about. We'll scope a fixed-price diagnostic and tell you whether it's drifting — and what it's worth doing about it.