Making Outcomes-Based Contracting Work With Facts
Introduction by Amit Anand, Robert Asen & Vijay Anand of Cognizant
Using metrics to develop effective results-based contracts
Managing outcome based application contracts requires a combination of scope management,
pricing, and, above all, quality. As suppliers and clients evolve the relationship, the
need for clear facts dominates conversations.
The premise of outcomes-based contracting is that hours (and indeed rate) are inputs to
the ADM process (not outputs), and that structures that measure programming results are
now both possible and achievable. Outcomes-based structures bring the original intent of
software to the forefront—creating successful results. While many companies have shifted
from input-based to output-based contracting, forward-thinking IT leaders are also taking
steps to define a sustainable outcomes-based relationship with their ADM suppliers.
Outcomes-based contracts focus on how the delivered product adds value, while inputand
output-based contracts focus on the resources and the activities needed to deliver the