Source: https://akholi.com/outsourcing-2026-agentic-ai-tier-1-banks/appendices/appendix-a-definitions/
Author: Phil Hatch
Publisher: Akholi

Appendix A: Definitions

The 2026 Report · Appendices

# Appendix A: Definitions

Controlled terminology and principal definitions used across the study

By Phil Hatch · Akholi · Version 1.8.2

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Appendix A defines the study’s principal terms using the Study Taxonomy. Survey questions and respondent quotations retain their original wording, including terminology that differs from the report’s usage.

Table 33. Terms used in the report and their definitions

| Term | Definition |
| --- | --- |
| Financial institution | Tier 1 firm buying the outsourced service, of 10 types that include insurers and private equity and private capital firms. |
| Vendor | Outsourcing firm delivering the service and employing every respondent. |
| The two firms | Financial institution and the vendor considered together, where a weakness belongs to their relationship rather than to either firm alone. |
| Model provider | Supplier of the underlying AI models and the platforms they run on. |
| Third-party provider | Any other supplier to the engagement, such as a supplier of tools, data feeds, or platforms. |
| Engagement | One contracted piece of outsourced work performed by one vendor for one financial institution. The engagement is the primary unit of the study. |
| Agent | One autonomous AI system operating within an engagement. |
| Agentic AI outsourcing | Outsourcing in which agents perform part of the contracted work alongside the vendor's delivery team. |
| Study set | 150 engagements and 850 respondents the study covers. |
| Respondent | A member of the vendor's delivery team who answered the survey about one engagement. |
| Individual contributor | Vendor role that performs the engagement's tasks. The study set holds 667. |
| Engagement manager | Vendor role that runs a single engagement. The study set holds 150, one on each engagement. |
| Portfolio director | Vendor role that oversees several engagements and their engagement managers. The study set holds 31. |
| Customer management executive | Vendor role that owns the relationship with the financial institution. The study set holds two, reported as counts only. |
| Delivery team | All vendor staff on one engagement, across roles. |
| Delivery workforce | All 850 respondents across the study set. |
| Financial institution staff | People employed by the financial institution who work with the engagement, including named subject-matter experts. |
| Outsourcing model | Form of outsourcing under which an engagement was contracted, customer experience management (CXM), information technology outsourcing (ITO), business process outsourcing (BPO) or knowledge process outsourcing (KPO). |
| Class of work | Whether an engagement served a line of business the financial institution runs or a corporate or back-office function. |
| Process family | One of eight groups of use cases. Each engagement was assigned to one process family from the use case it recorded. |
| Type of financial institution | One of 10 types recorded for each engagement, from asset management to private equity and private capital. |
| Vendor type | Respondent's employer type. The five types are the IT services major, the BPO specialist, the consulting firm, the pure-play agentic AI firm, and the boutique or specialist provider. |
| Build-Out | First stage measured, covering planning, team build-out, and knowledge transfer. |
| Transition/Cut-Over | Second stage measured, covering development, proof of concept, and engagements on hold. |
| Production | Third stage measured, covering engagements in production and delivery. |
| Canceled | An engagement terminated as of the study date. |
| Active | An engagement still running as of the study date. |
| Failure category | One of five groups of 20 rated indicators, each describing the conditions of an engagement by where a weakness lies. |
| Financial institution readiness | Conditions inside the financial institution, covering its data, its processes, its legacy systems, the skills of its people, its governance, and its responsiveness. |
| Vendor capability | Conditions inside the vendor, covering leadership, industry knowledge, agentic AI knowledge, the delivery playbook, platforms, talent, training, and the commercial model. |
| Co-management | Conditions arising from the two firms working together, covering decision rights, joint management of risks and issues, change control, human review, and the fit of governance. |
| AI technology | Conditions of the agentic tools themselves, covering reliability, non-determinism, memory, context, security, authorized action, token economics, and observability. |
| Third-party ecosystem | Conditions arising from third-party providers and the chain of dependencies beneath them. |
| Indicator | A survey question, engagement field or study measure analyzed in its own companion analysis. |
| Rated indicator | One of the 100 indicators, 20 in each failure category, that make up the engagement indicator mean. |
| 10-point scale | Scale from 1 to 10 on which respondents rated the indicators and the other rated questions. |
| Rating | A respondent's answer from 1 to 10 on a rated question. |
| Favorable-direction indicator | An indicator on which favorability increases across the 10-point scale, where 1 is the most unfavorable rating and 10 the most favorable. |
| Favorable-direction conversion | Presentation of an unfavorable-direction indicator’s rating in the favorable direction, made by subtracting each rating from 11, so that a higher figure denotes the more favorable outcome. |
| Unfavorable-direction indicator | An indicator on which 1 is the most favorable rating and 10 the least favorable. The eight are C019, C021, C023, C025, C039, C051, C053 and C054, among them intent to leave and cancellation likelihood. |
| Question without a favorable end | A rated question with neither a favorable nor an unfavorable end. The eight are C027, C028, C066, C067, C068, C203, C209 and C215. |
| Distressed | A rating at the bad end of the question's own scale, 3 or below where a low rating is bad and 8 or above where a high rating is bad. The rule applies to an engagement's mean rating in the same way. |
| Indicators distressed | Share of an engagement's ratings on the rated indicators that are distressed, computed for each respondent, averaged within the engagement and then across engagements. |
| Indicator quintile | One of five bands of 30 engagements, ranked by engagement indicator mean. |
| Indicator class | Level at which an indicator was recorded, as respondent level, engagement attribute, or perceived fact. |
| Engagement attribute | One fact about the engagement, repeated across its respondents and never counted as independent observations. |
| Perceived fact | A fact about the engagement as the respondent understood it, such as the asset size of the financial institution. An answer of “I do not know” is reported as a finding. |
| Structured answers | Answers to the 195 structured survey questions, 172 numeric and 23 categorical. The study holds 149,619. |
| Written answers | Answers to the study's 16 open questions. The study holds 8,918. |
| Written response | A written answer about the respondent's own engagement that addresses a given indicator. Non-answers and answers about another engagement are excluded. |
| Primary and secondary response | A primary response answered the open question of the indicator's own survey section. A secondary response answered another open question and addressed the indicator in its content. |
| Sentiment score | Score of a written response on five values, from −10, a subject described at or near its worst, through −5, 0 and +5 to +10, at or near its best. |
| Theme | A recurring point in the written answers that no survey question captures, such as the frequency of manual work. |
| Emotional state | A state the respondent reported of himself or herself in a written answer, such as stressed, tired, or frustrated. |
| Non-answer | Answer “I do not know” or “I prefer not to answer,” counted separately and excluded from a mean. |
| Four core study measures | Cancellation rate, customer satisfaction, engagement indicator mean, and intent to leave, applied to every indicator in that order. |
| Cancellation rate | Share of a named group of engagements canceled by the study date, computed at engagement level. |
| Customer satisfaction | Satisfaction figure recorded against each engagement on a 100-point scale, as reported by the delivery team. The measure is never abbreviated. |
| Engagement indicator mean | Mean of an engagement's ratings on the 100 rated indicators, computed for each respondent and averaged within the engagement. |
| Intent to leave | A respondent's rating, from 1 to 10, of how likely he or she is to leave the current job in the next 12 months. |
| Measured return | Return on an engagement, recorded for the 30 engagements in Production and printed with that base. |
| Cancellation likelihood | Delivery team's rating, from 1 to 10, of how likely the financial institution was to cancel an active engagement. |
| High risk | An active engagement whose mean cancellation likelihood rating was 7 or above. |
| Moderate risk | An active engagement whose mean cancellation likelihood rating was 5 or above and below 7. |
| Canceled or at risk | Canceled engagements together with the active engagements at high or moderate risk. |
| Manual alteration | A change made by hand by the delivery team to financial institution material, agent output, or reporting, counted by five methods. |
| Manual alteration of financial-institution-provided data | Changing by hand the data the financial institution supplied to the engagement. |
| Manual alteration of financial institution processes | Changing by hand a process of the financial institution, such as deciding a process step the financial institution had not decided. |
| Manual alteration of AI outputs | Adjusting by hand the output of an agent before it was used or sent. |
| Reporting alteration | Vendor's alteration of the performance reports and dashboards the financial institution received. |
| Third-party work done by hand | Delivery team performing by hand the tasks a third-party system did not deliver, such as keying in data a broken feed did not supply. |
| Internal disclosure | Telling the vendor's own management about a manual alteration. |
| Financial institution disclosure | Respondent or the respondent's management discussing a manual alteration with the financial institution. |
| Reported experience | Respondents' account of their own engagements, the evidence class of the whole study. |
| Engagement level | A figure computed with one value per engagement, on a base of up to 150 engagements. |
| Respondent level | A figure computed across respondents, whose answers cluster within engagements, on a base of up to 850 respondents. |
| Base | Count of respondents, answers, or engagements on which a figure was computed, being those who answered rather than those who were asked. |
| Confidence interval | Range around an estimate that contains the true value at a stated level of confidence, 95% unless stated otherwise. |
| p value | Probability of a result at least as extreme as the one observed if no association existed. |
| Pearson's r | Correlation between two measured quantities, from −1 to 1. |
| Spearman's rho | A correlation computed on the ranks of the values, used as a check on Pearson's r. |
| Chi-square test | A test of whether a split across categories departs from what independence would produce. |
| Welch's analysis of variance | A test of whether a mean differs across the levels of an attribute, without assuming equal spread across the levels. |
| Holm correction | An adjustment of each p value in a family of tests for the number of tests in the family. |
| False discovery rate | Expected share of false positives among the results that pass the test, controlled across the 300 partial tests. |
| Detection floor | Smallest correlation the tests could reliably detect, 0.23 at 150 engagements, a test level of 0.05, and 80% power. |
| Equivalence bound | Bound of 0.30 in absolute value of r, below which an association is treated as negligible. |
| Equivalence test | A pair of one-sided tests of whether an association lies within the equivalence bound. |
| Held | State of an association that had p below 0.05, survived correction for multiple comparisons, and kept its sign and its p below 0.05 under the robustness checks. |
| Did not hold | State of an association that had p below 0.05 on the primary test but failed correction or one or more robustness checks. |
| Null equivalent to zero | A result that had p of 0.05 or above and whose interval lay within the equivalence bound. |
| Inconclusive null | A result that had p of 0.05 or above and could not be shown equivalent to zero. |
| Clean estimate | An association computed against customer satisfaction among the 94 active engagements, where no cancellation had occurred for a respondent to react to. |
| Descriptive contrast | An association computed against realized cancellation across all 150 engagements, whose canceled engagements were rated after cancellation. |
| Leave-one-out | Recomputation of the engagement indicator mean without the indicator under test. |
| Partial test | A test of whether an indicator was associated with a measure beyond what the engagement indicator mean accounts for. |
| Intraclass correlation (ICC) | Share of the variance in an indicator that lies between engagements rather than within them. |
| Design effect | Factor by which clustering within engagements inflates variance, equal to one plus the ICC multiplied by the mean cluster size less one. |
| Effective sample size | Number of respondents who answered divided by the design effect, the number of independent answers the clustered answers are worth. |
| Cluster bootstrap | An interval computed by resampling whole engagements rather than respondents. The answers from one engagement stay together. |
| Robustness check | A repeat of a primary test on a subset of the study set or under another method. |
| Study norm | Median association of the study's indicators with each of the four core study measures, against which each indicator is compared. |
| Thin base | A base under 30, printed with its count and without a confidence interval. |
| Anecdote strength | A base under 10, reported as counts only and never as a rate. |
| Companion analysis | Full statistical analysis of one indicator, engagement field, study measure, or derived analysis. The study holds 216. |

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