Symphony Services, a Palo Alto, Calif.-based provider of offshore IT services in India and China has been touting its "outcome certainty" pricing model for software engineering. "It commits us to meeting mutually agreed-upon goals," says Neil Fox, Symphony Services' vice president of strategic consulting. "If we don't meet them, clients pay reduced costs for our services."

The trick to outcome-based outsourcing, says Fox, is "linking contractually guaranteed work by the vendor to measurable client business outcomes, such as improving product line revenue, raising customer satisfaction, increasing product innovations or reducing time to market."

For customers who want to align vendor goals with business goals, outcome-based pricing can be the differentiator, says Fox. But not everyone is into the idea. "Some clients opt out of our outcome certainty-based contracts because they want the most simplified approach to managing their outsourcing partner," says Fox. Those customers sign more traditional fixed-cost or time-and-materials contracts.

Some customers shied away from the strategically focused outcome-based approach to sourcing during the recession when all eyes were on cost-cutting, according to Forrester Research principal analyst Bill Martorelli. Just 24 percent of outsourcing customers said increasing their use of output-based pricing was a high or critical priority, according to a Forrester survey conducted during the second quarter of this year. Nearly one-fourth (24 percent) said it was a low priority, while 37 percent reported that it was not on the agenda. But Martorelli predicts outsourcing customers' interest in outcome-based outsourcing will increase as the economy stabilizes.