>>> the change is mostly about moving this risk (and potential reward related to it).
This is exactly right! And the theory behind it is actually one of the papers behind this year's economics Nobel Prize.
Different billing models aren't about paying for outcomes - they're about how to both incentivize and compensate when 1) there is uncertainty about the effort and ability required and 2) there is uncertainty about the degree to which effort and ability will lead to outcomes and 3) outcomes are costly or difficult to measure.
Different ways of billing are really about who takes on the risk (and gets both the upside or the downside), as well as how to align incentives between the service provider and the recipient. Oftentimes risk-sharing and incentive-alignment are in conflict with each other, which is why this isn't an easy topic.
This is exactly right! And the theory behind it is actually one of the papers behind this year's economics Nobel Prize.
Different billing models aren't about paying for outcomes - they're about how to both incentivize and compensate when 1) there is uncertainty about the effort and ability required and 2) there is uncertainty about the degree to which effort and ability will lead to outcomes and 3) outcomes are costly or difficult to measure.
Different ways of billing are really about who takes on the risk (and gets both the upside or the downside), as well as how to align incentives between the service provider and the recipient. Oftentimes risk-sharing and incentive-alignment are in conflict with each other, which is why this isn't an easy topic.