Managing Successful IT Outsourcing Relationships docx

[...]... without written permission of Idea Group Inc is prohibited Introduction 3 topics such as outsourcing definitions (Chapter II), opportunities and threats, value configurations, e-business infrastructure (Chapter III), and IT outsourcing theories (Chapter IV) The second part presents key topics in managing successful IT outsourcing relationships, as illustrated in the Figure 1.1 Managing successful IT. .. contracting of any service or activity to a third party Both definitions are concerned with the interfirm relationship, Copyright © 2006, Idea Group Inc Copying or distributing in print or electronic forms without written permission of Idea Group Inc is prohibited IT Outsourcing 21 Table 2.3 Outsourcing definitions in the research literature Literature reference Outsourcing perspective Theoretical... reasons for outsourcing were access to skills, improved quality and focus on core business Four factors contributed to successful outsourcing: a tight contract, a partnership, a change process, and the IT manager’s role changing from managing projects and operations to acquiring and managing the internal and external resources required to do the organization’s IT work Successful IT outsourcing relationships. .. book To highlight our recommendations, we end Chapters V to XII with a conclusions section, where we express our own opinions for managing successful IT outsourcing relationships Three International-Based Research Case Studies In order to understand the inherent complexities and the underlying constructs of managing successful IT outsourcing relationships, empirical research was need The exploratory case... print or electronic forms without written permission of Idea Group Inc is prohibited IT Outsourcing 23 and the authors pay attention to how to deal with uncertainty and risk encompassed in outsourcing Where Barthélemy is concerned with management expertise as a predictor of success or failure, Langfield-Smith and Smith are concerned with the design of management control systems Outsourcing is a phenomenon... degree of IT outsourcing by using cost structures and economic performance They found that the degree of IT outsourcing is positively related to both business and IT cost structures, and negatively related to IT performance IT outsourcing was framed as a make-versus-buy decision, where contractual modes differ in the domain of influence within the corporation (Loh & Venkatraman, 1992a, 1992b) Lacity, Willcocks,... to the IT unit, assuming that senior management has taken responsibility for overall strategy Copyright © 2006, Idea Group Inc Copying or distributing in print or electronic forms without written permission of Idea Group Inc is prohibited IT Outsourcing 7 Beaumont and Costa (2002) studied IT outsourcing in Australia They found that almost 40% of Australian organizations outsource one or more IT applications... issue is new capabilities In undertaking an internal initiative, a company has concluded that it lacks an important set of skills, otherwise it would not be seeking transformation But it often proves too time consuming to develop the skills internally In a mergers-and-acquisition scenario, the company acquires the capabilities it lacks, but cultural clashes often interfere with its ability to use them... expectations in the outsourcing context As the IT outsourcing literature has documented, management defines the scope of the outsourcing and the sourcing criteria, while the IT department can provide insights into the technological reasons for outsourcing and judge the success of the outsourcing project in terms of performance outcomes that are met Expectations that need to be realized in the outsourcing context... critical noncore; and finally noncore, noncritical Core processes are seldom Copyright © 2006, Idea Group Inc Copying or distributing in print or electronic forms without written permission of Idea Group Inc is prohibited IT Outsourcing 15 outsourced, because they are the very essence of the business and the area that requires the most investment Critical and noncritical noncore processes may be suited . topics in managing successful IT outsourcing relationships, as illustrated in the Figure 1.1. Managing successful IT outsourcing relationships starts with an enter strategy and ends with an exit strategy 6 Transformational Outsourcing 7 Outsourcing Decisions 10 IT Outsourcing Markets 10 Business Application Outsourcing 12 Business Process Outsourcing 14 Maturity 15 Innovation Diffusion 18 Outsourcing Definitions. Infrastructure 38 Vendor Value Proposition 52 IT Function Organization 57 Outsourcing Performance 58 Successful Relationships 60 iv Outsourcing Opportunities 60 Outsourcing Threats 62 Business Example: