What Are Co-Sourcing and Outcome-Based Outsourcing

A group of employees observing their boss

Markets and industries are constantly in flux, and as a business, it is useful to always be in the know what those changes are. 

One is for you to keep up with it. 

Another reason is for you as a business owner to prepare yourself and create strategies to face those changes. 

In outsourcing, there are two types of outsourcing that are becoming more popular recently. 

These are co-sourcing and outcome-based outsourcing.

According to Infoq, these two types of outsourcing would become the new norm in businesses. 

However, what are they? 

A team of employees in a huddle


Outsourcing thrives on the concept of collaboration between a company and its service provider. 

Now, co-sourcing elevates the principle of collaboration between those two entities. 

With co-sourcing, both teams from different companies work together creating more value to work. In that sense, both the hiring company and the service provider will work together, side by side, and at the same time, mitigate risks. 

Also, instead of focusing on just one function, the service provider provides support across different functions in a company.

A relieved employee at work

Outcome-based Outsourcing

As its name implies, this model focuses on the outcome of a project or projects. It also means, instead of focusing on the cost of labor, a client pays for the outcome results and outputs from its service provider. 

In a way, it encourages motivation on the provider’s end and mitigates risk for the one employing them.