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Two years ago, Dynegy Inc. appeared destined to follow its larger hometown rival Enron Corp. into scandal and bankruptcy. The Securities and Exchange Commission was suing the Houston energy company for questionable accounting methods, debt was mounting, and the entire energy industry faced punishing scrutiny in the wake of Enron's blowup. Dynegy, with 2003 revenue of $5.8 billion, has since resolved most of its legal troubles, and it has cut debt by about two-thirds.

Dynegy's decision last year to outsource the bulk of its IT operations to Accenture is a big contributor to the turnaround, says Steve Moffitt, Dynegy's CIO and a senior VP. "We were stuck with a technology infrastructure built to support a $40 billion company, and that's not where Dynegy was anymore," he says. Accenture has taken over systems management, help desk, application development, and most of Dynegy's other major IT operations. The result: The company has cut its IT costs by up to 30%. What's more, by outsourcing, Dynegy is better positioned to integrate operations from a recent $1 billion acquisition of Exelon Corp.'s power-generation plants. "We're shifting to a global model, and Accenture has the means to support that," Moffitt says.

Dynegy's experience indicates why the outsourcing business continues to enjoy steady growth. Worldwide spending on IT services increased 6.4% in 2003 to $570 billion, according to research firm Gartner. Despite that growth, IT executives aren't overly satisfied with their outsourcing partners. A recent InformationWeek Research survey of more than 300 business-technology professionals shows an average customer satisfaction rating of 6.4 on a scale of 1 to 10, where 1 is "not at all satisfied" and 10 is "extremely satisfied." That's down from 7.1 in InformationWeek's last survey of outsourcing buyers two years ago. And nearly 30% say their outsourcer hasn't met their expectations. The survey also asked respondents what they seek in outsourcing providers, rating them in 10 categories, including reliability, reputation, cost/value, and vertical-industry knowledge. (Find out more about the survey methodology)

No. 1 outsourcer Deloitte Consulting, which scored 7.4, was the only provider to score above 7 in the satisfaction ranking. Deloitte also ranked No. 1 in nine out of the 10 categories. That's partly because some of the expertise and best practices housed in the auditing side spills over to its outsourcing business, says IDC analyst Alexander Motsenigos. The firm insists it doesn't pursue outsourcing engagements with its audit clients. Still, Deloitte's connection to a big auditing firm is "a differentiator that others in the market don't have," Motsenigos says.

Deloitte also is the only outsourcer in the group that isn't publicly traded, and it attributes part of its success to the fact that it answers to customers, not Wall Street. "Outstanding," is how one customer describes Deloitte's reliability and responsiveness. The customer, an IT manager at a West Coast test-and-measurement equipment manufacturer, says Deloitte hit the mark with a recent Siebel Systems Inc. implementation.

Outsourcing pays off for Deloitte. Its revenue from systems integration, application outsourcing, and consulting increased 5% from 2002 to 2003 and now stands at $5 billion a year, Motsenigos estimates.

Accenture and Capgemini tied for second in our ranking, with overall scores of 6.8. Accenture's flexibility is a strong trait, Dynegy's Moffitt says. Under the deal, the energy company owns its servers and software, and its employees have direct contact with Dynegy's internal IT staff when problems arise. "We wanted to maintain a lot of control internally, and they supported that," Moffitt says.

In last and next to last place, respectively, are two of the industry's most dominant players, IBM Global Services and EDS. Respondents gave IBM a mediocre 5.3 out of 10 for reliability, and IBM and EDS landed at the low mark of 5.4 for innovation.

IBM doesn't pay enough attention to its smaller contracts, says Brian Clement, delivery manager for human-resources and payroll-services firm Ceridian Canada. "They were being a bit lackadaisical and taking our business for granted," he adds. Ceridian has a multimillion-dollar contract with IBM to host its PowerPay payroll-management application from its data center in Toronto.