Outsourcing deals tend to meet cost targets but fail to meet strategic objectives, according to a report by IT services consultancy Deloitte.

According to the survey, 89% of companies reported at least a 25% return on their investment. But the report also claims many companies are disappointed with providers' overall ability to achieve continuous process and technology developments.

"When developing an outsourcing contract, both the supplier and end-user need to identify what is expected of both parties," said Martyn Hart, chairman of the National Outsourcing Association.

"If there is no explicit statement that the end-user wants process and technology improvement, the supplier cannot be expected to provide this."

But Hart added that outsourcing was likely to continue to flourish due to a return to cost-saving objectives brought about by the economic slowdown.