Price is always a factor in any buying decision, especially where the performance of procurement professionals is evaluated based on money saved. Outsourcing contracts that save money and meet the goals of the business in more ways than one are the ones that really move the needle.

Here are two critical areas that will help create outsourcing contracts that focus on business needs and goals and pricing:

Spell it out: From terms to Service level agreements to detailed roles and responsibilities, make sure your outsourcing contracts have every line item listed and spelled out to the nth level of detail. Write the contract as if you won't be there to read it the minute it is written. Make it explicit for both, internal and external teams so that their roles & responsibilities are clearly defined. also make sure that the contract provides clear (early) termination clauses so that there are no loop holes should you wish to terminate the contract early.

Transition Period: The scope of work for the actual work is usually well understood by most. The area where most scope statements fall short is in defining the transition period roles and responsibilities and also the scope during the transition period. This invariably leads to finger pointing and lack of accountability about scope responsibilities.

Pricing is the primary variable when outsourcing although flexibility in agreeing to a price comes into play when other conditions and requirements are more favorable. So although you started down the path of outsourcing to save money, how much you save is based on what else you were able to negotiate with the supplier/s. Also, pricing will change year over year so that you may not find savings after the initial one or two year period. That's when the other negotiated terms and conditions become more important.

Price is the biggest factor in creating an outsourcing relationship. However optimizing outsourcing contracts to create a balance between overall benefit to the company in areas such as scope of work, SLA's and tranforming the company through innovation is perhaps even more important.