Part of the problem with this new paradigm, whereby contracts are based on results rather than resource consumption, is in defining outcomes. Every stakeholder has a different desired end state--or two or three. The CEO wants happy customers and shareholders or to be the industry leader. The CFO wants an increase in profitability. The business unit leader may desire best-of-breed systems. And the CIO? He's got a whole list--lower costs, better service levels, increased customer satisfaction.

What may be the biggest problem of all is that the IT service provider has very little control over or connection to any of those outcomes.

Pros

* More cohesion of work being delivered