Systems and methods for assessing performance of an outsourcing engagement are described. According to the present subject matter, the system(s) implement the described method(s) for assessing the outsourcing engagement. The method includes identifying at least one Critical Success Factor (CSF) associated with the outsourcing engagement between a vendor and a client based on conducive conditions of outsourcing. The method further includes determining at least one of a plurality of parameters and a plurality of sub parameters associated with the identified at least one CSF, wherein the plurality of parameters and the plurality of sub parameters are inter dependent and effect performance of the at least one CSF. Further, the method includes assessing a value of performance for at least one parameter and at least one sub parameter from amongst the plurality of parameters and the plurality of sub parameters respectively, based on a system dynamics model.