Executive Summary (This is a document excerpt)

Something is wrong with the outsourcing industry. Despite double-digit growth, providers are facing lower profits, shorter contracts, and unhappy customers. And very few $100 million deals signed today will generate the expected revenues five years into the contract. The fundamental problem? A 30-year-old business model based on inflexibility that doesn't account for the predictable patterns of technology adoption and deployment that every company goes through. The solution? Forrester proposes a new outsourcing business model — Adaptive Sourcing — comprised of flexible contracts, pricing, and service delivery that adapts over time to customer needs and expectations. Adaptive Sourcing will transform the entire outsourcing industry — if vendors have the foresight and courage to adopt it.

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