Gain-Sharing: Good in Theory…
Gain-sharing, as a concept, appears to be falling out of favour in recent outsourcing transactions. Once considered an innovative concept for sharing saving made by the supplier of outsourcing services, it has proved unworkable, or forgettable, over the years. Gain-sharing clauses started appearing in outsourcing contracts at least as early as a decade ago. The principle is simple: if the supplier finds a way to save costs while providing the same service, it will share those savings with the customer.
Gain-sharing has a fundamental problem: the interests of the supplier and customer are not aligned. The customer is trying to . . . [more]
