AB
Aysha Begum
Dec 2025 · 6 min read · Practice

Most contracts measure activity

Hours billed. Deliverables produced. Milestones reached. None of these correlate strongly with whether the customer’s P&L moved. Outcome contracts attempt to measure the thing that actually matters.

The two-line outcome

Every outcome contract opens with two lines: the metric that will move, and the window in which it will move. “Loan decisioning time will fall from N days to M minutes by Q4.” Every other clause exists to support those two lines.

Skin in the game

A meaningful portion of the fee is contingent on the metric moving. Not all of it — the engineering still has a fixed cost — but enough that both parties feel the outcome.

Joint measurement

The metric is measured by a system both parties trust. We co-instrument it from week one. Disputes about whether the metric moved are 90% prevented by transparent instrumentation.

When not to use them

Pure platform engineering. Pure infrastructure. Anything where the measurable outcome is too far downstream of the work being done. In those cases, fixed-fee with explicit deliverables is more honest.

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