It's all about results (outcomes) versus resources (inputs)

Managed Services (Outsourcing) Staff Augmentation (Out-tasking)
Supplier assumes control of all or part of the execution
component of IT
  • Service delivery commitments expressed as "service levels"
Supplier commits to providing resources of defines capability
at a price
  • No service delivery commitments relative to outputs
Committed scope and term Limited commitment
Pricing tied to service levels and volumes where appropriate Pricing tied to hours worked and availability
Supplier manages delivery model, processes and tools Client manages delivery model, including subcontractors,
processes and tools
Impacted employees, assets and contracts may be
transitioned to supplier (supplier needs to acquire or have the
capability to deliver)
No change to client's operating model
Knowledge must be documented and transferrable Knowledge vested in the individual
Supplier assumes the risk of transition and operations All delivery risk remains with client
Commitment to deliver an outcome Commitment to provide an input