Performance-based contracting is a relatively new business strategy emphasizing substantial use of performance measures as the basis for pricing and contractual terms. The performance measures, often referred as key performance indicators (KPI) are normally agreed by both sides of the contracting relationship. However, the effect of certain performance indicators on the contracted work can be unpredictable if the terms and conditions of the contract are not properly analyzed. Therefore, understanding of the performance based contract (PBC) is crucial to its success in business systems. This issue is even more critical in systems of systems, where the contractual arrangements can be very complicated. This chapter outlines methods to assess performance from theoretical models prior to the signing of PBC contracts, thereby reducing the risk of unpredictable effects. The methods described link the capabilities of a system with potential performance so that corrective actions can be taken prior to a real commitment.