Outcome-based engagement models allow businesses to share risks and rewards with partners, aiding in more efficient management of business volume fluctuations. While it may appear to be a win-win situation for clients and partners on paper, its execution is far from simple.
The on-ground challenges clearly illustrate that both parties require a comprehensive understanding of their responsibilities and the level of collaboration needed for this setup to succeed. The execution hurdles faced by both sides necessitate:
- A well-thought-out approach to this setup
- Clearly defined outcomes and measurable metrics,
- The right expertise and experience from partners to hit the ground running
- Accurate assessment of the client’s operational maturity
- Wilful intent to undergo the required business, procedural and technological transformation
- Seamless collaboration among different stakeholders
Unless the above list is sorted, this model can easily falter, with blame being thrown between parties for not foreseeing challenges. Service providers must bring expertise, hands-on experience, and a broad understanding of emerging technologies to be accountable for outcomes.
A significant hurdle arises because this shift requires a switch from an input-based to an outcome-based approach. That requires much more than planning and tools.
In this post, we will discuss the three challenges that organizations often face when they opt for an outcome-based engagement and how they can overcome them using some simple measures:
1. Defining Agreeable Outcomes with Clear Quantifiable Metrics
Since this model centers around outcomes, it’s critical for clients to define them from the outset clearly. However, the outcomes must include:
- The scope of engagement
- Goals to be achieved
- Metrics for tracking progress and transparency
- Well-defined timelines
- Relevance for clients
Defining these elements is only the beginning. Effective communication with the solutions partner is crucial once the scope and goals are established. This understanding is vital for achieving the outcomes within the desired timeline.
Clear definitions lead to several benefits: both parties comprehend the goal and timeframe and understand the impact on the client’s business. Such clarity naturally leads to accountability and facilitates the pragmatic realization of outcome-based engagements.
Imagine collaborating on a project where your partner is unsure about acceptable test coverage for your financial product. When your organization’s product and engineering teams have differing interpretations, chaos ensues.
Qapitol has successfully overcome this challenge by helping clients define the problem statement and contrast it with the symptoms of the problems that are more conspicuous than the problem itself. Once alignment is reached on the problem statement, we help them articulate the expected outcomes.
This gives us the opportunity to define the approach to the desired outcomes, measurement of progress towards the desired outcome, the types of skills and competencies needed and the indicative timelines to reach the target state.
In a recent outcome-based engagement with a high-growth tech retail firm, we successfully helped and aligned the client on the problem statement around improving Test Automation. We also published a set of measurable outcomes for Test Automation as below along with realistic timelines to achieve these outcomes:
- Ensure 90% pass rate for B2B App smoke suite and regression suite.
- Ensure 90% pass rate is maintained at-least 80% of the time automation suites are executed in Test environment and Prod environment.
- Increase the B2B app regression automation coverage to 80%. (Currently, it’s 70%)
- Ensure B2B app health check suite runs on production environment every day.
As you can see, defining the problem statement clearly right at the onset brings all the stakeholders on one page. The objective metrics add the second level of clarity needed to measure the progress of efforts. Once these two are defined, it is easier to design a concrete plan of action and work towards pre-defined goalposts.
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2. Bridging the Cultural Gap
Cultural alignment between client and partner organizations is paramount, yet it’s an often overlooked challenge during implementation. While having distinct cultures is expected, solutions providers must possess teams capable of navigating the client’s dynamics to collaborate effectively. This responsibility isn’t solely on the partner organization; clients also play a role in identifying hurdles and sensitizing teams to the expected level of collaboration.
Consider a QE solutions provider based in India advising a conglomerate with its engineering and testing teams spread across the globe. It is not difficult to imagine the hurdles that the solutions provider would face right from communication barriers, mismatches in schedules, asynchronous workflows and resources used by each team to communicate within and across teams, unaligned expectations, differential decision-making styles and hierarchy levels. If the provider does not have a team that has dealt with and navigated through similar circumstances before, they will feel overloaded with issues as soon as the engagement gets started. Hence, it’s important to pick partners who not only have the technical expertise but also have the experience of working their way through an organization’s dynamics with a minimal amount of friction.
While working with a digital native firm in the insurance sector, we were empowered to choose and implement the right tools and technology stack for automation with minimal interference from the client. However, for another client in the same sector, the entire process of choosing and implementing the tool/technology stack for test automation involved buy-ins from multiple stakeholder engagements at different levels such as Engineering Pod Leads, Enterprise Architects, Solution Architects etc. However, given our agility and experience in dealing with these Governance forums, the right decision was implemented at the right time without losing much time in the approval process. It required a fine mix of tactful handling of relationships, interest-led collaboration, and purpose-led communication to reduce ambiguities, minimize friction and create consensus.
3. Unique challenges call for unique solutions
Designing services to address Quality Engineering (QE) challenges is one thing, but implementing them seamlessly at a client’s site is another. Each business is unique due to its choices in delivering value to customers, and this uniqueness must be considered when tailoring services.
Boutique service providers often struggle with this when their services excel in solving standalone QA/QE challenges but fail to deliver results when applied in a client’s environment. One reason for this failure is the solution engineers’ inability to deep dive into the client’s processes with a minimal learning curve and customize the solution accordingly.
Adapting frameworks, aligning testing guidelines, integrating reports, collaborating with development and QA teams, providing a holistic view of the Software Testing Life Cycle (STLC), and offering valuable insights are key steps to ensuring a successful solution implementation. But the route you take to achieve them is going to be quite different from a fintech client v/s a healthcare client.
We offer varied solutions for test automation of Web, Mobile and API, based on business requirements. For one of our clients in banking, the way these solutions were implemented differed within the various organization units due to the nature of the work being done by each of them. For certain units, we proposed a Top-Down approach to automation starting with UI, while for another business unit, we employed a Bottom-Up approach to test automation, starting with API and moving on to UI. For others, we adopted a Hybrid approach to test automation.
Outcome-based engagements reward accountability, results and efforts in the right proportion. But they often leave a bad taste for both parties if not executed well. So, as a client keen on implementing this engagement for your next project, it’s important that you look for partners who understand the inherent challenges plaguing this engagement model and have been able to resolve them for other clients. This experience would showcase their capability and enable them to guide you with the right advice and caution you about the inherent risks associated with every step – seeing the unforeseen. Look out not just for the best but for those who have been through the worst and come out with flying colors.