Using a formal specification contractually

A commonly made criticism of formal methods is that they increase costs. Selective use of formal methods to define critical requirements can, however, lead to a significant decrease in lifecycle costs. In particular the economic and technical benefits of outsourcing the development of software can be fully realized and the cost of outsourcing slightly reduced by use of a formal specification. In this paper we describe a development in which a formal specification prepared by the customer formed part of the contract with the supplier. We conclude that this use of a formal specification can reduce risks and costs for all concerned and can help foster fruitful and co-operative relations in situations which are often fraught with confrontation.Published with the permission of the controller of Her Britannic Majesty's Stationery Office.