The interplay between internal and external contextual factors and pricing model choice in IT outsourcing (ITO) contracts is still an under-researched area in the ITO literature. However, as past and current examples of outsourcing failures indicate, an informed selection of an adequate pricing model indeed plays a crucial, if not decisive role to ensure a successful deal outcome and to mitigate risks in the wake of the deal. Based on contingency theory, the paper at hand explores 60 ITO megadeals (> EUR 50 million) for the impact of the alignment of business objectives and market factors with pricing model choice on ITO deal performance. Our empirical results, which were based on a fitas- gestalts conceptualization, suggest that a high congruence of business objectives and market characteristics with pricing model attributes in ITO contracts engender better cost control and service results and a higher level of satisfaction after ITO deals than a low congruence of these factors. Our findings offer several interesting implications that can be used to improve pricing configurations in ITO deal contracts.
Benlian, Alexander, "Exploring the Impact of Fit between Context Factors and Pricing Model Choice on the Success of IT Outsourcing Mega-Deals" (2010). ECIS 2010 Proceedings. 148.