Using the power of research to inform ICT integration in education

Posts tagged ‘outsourcing’

Are Information Technology Outsourcing Alliances (ITOA) viable options?

Theophanis C. Stratopoulos, Mihir A. Parikh, Peter Lane (2009) Information Technology Outsourcing Alliances: A Strategic Alternative for IT-Capable Companies

While previous research has focused on choosing between insourcing or outsourcing, no systematic attempt has been made to find a viable alternative for IT-capable companies, which need to realize optimum value from their IT capabilities. This study identifies information technology outsourcing alliances (ITOA) as a strategic alternative to generate additional value from the capabilities of internal IT organizations. By building an ITOA with complementing partners, an IT-capable company can go beyond its internal market for IT services to provide similar and, even new, IT services to third parties. Grounded in transaction cost economics, relational theory, production theory and reciprocal learning alliances view, this study suggests that the IT-capable company can earn the collaboration-, transaction-, and firm-specific quasi rents through ITOA.

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How does the client-vendor relationship determine the success of Information Technology Outsourcing (ITO)?

Jorg Verbaas (2010)  “It takes two to tango”.  A Review of the Empirical Literature on Information Technology Outsourcing Relationship Satisfaction. Ph.D. dissertation, Tilburg University, Draft Paper

There is growing recognition that the overall client-vendor relationship, and not only the contract, plays a critical role in Information Technology Outsourcing (ITO) success. However, our understanding of how ITO relationships function is limited. This paper contributes to this understanding by reviewing empirical literature on ITO success in terms of relationship satisfaction. A key finding is that the majority of reviewed studies concentrates on client satisfaction, thus neglecting the vendor perspective. We argue that this raises questions about the construct validity of these studies. Consequently, concerns exist about the validity and reliability of their empirical findings. Some scholars have acknowledged the problem and use a dyadic perspective. However, a review of these studies reveals that the authors have underestimated their contributions and do not explain why there is a problem. Therefore, the purpose of this paper is to highlight their contributions by comparing the findings of the dyadic perspective studies with those of the “client perspective” research. In doing so, we assess whether the dyadic studies produce better explanations for ITO success than the client-oriented studies. We argue that this is indeed the case, by producing a better view on how underlying mechanisms of ITO relationships work.

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When is IT outsourcing profitable?

Chang, Young Bong, and Vijay Gurbaxani (2012) “Information technology outsourcing, knowledge transfer, and firm productivity: An empirical analysis.”MIS Quarterly 36.4 (2012): 1043-1053.

Our study has important implications for practice. We demonstrate that IT outsourcing does lead to productivity gains for firms that select this mode of service delivery. Our results also suggest that IT-related knowledge held by IT services vendors enables these productivity gains, the magnitude of which is moderated by a firm’s IT intensity. Moreover, the value of outsourcing to a client firm increases with its propensity for outsourcing, which in turn depends on firm-specific attributes including efficiency level, financial leverage, and variability in business conditions. We show that IT outsourcing is a valuable delivery option, but not for all firms. Client firms must assess potential service providers not just using the traditional criteria of price and service levels, but also their knowledge capabilities. In addition, client firms must focus on building in-house assets that complement the provider’s capabilities.

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Why should outsourcing school technology be about learning more than technology?

Benoit A. Aubert, Jean-François Houde, Michel Patrya, Suzanne Rivarda (2012) A multi-level investigation of information technology outsourcing, Journal of Strategic Information Systems 21 (2012) 233–244

This paper presents a model explaining the IT outsourcing decision. Some findings highlight unique characteristics of IT outsourcing. For instance, firms in knowledge intensive industries using less outsourcing than firms in less knowledge intensive ones suggests that information processing activities might be treated somewhat differently from other activities. In addition, results show that the activities are not totally independent. Any outsourcing decision has to take into account activities within an ensemble. Managing these activities without acknowledging this would lead to coordination problems and inefficiencies. This might explain why some activities that seem perfect candidates for outsourcing are actually better managed inside the firm. Finally, the results suggest practitioners to consider their unique situation (notably the demand uncertainty and the knowledge intensity of the domain in which their firm operates). Recipes that have worked in one organization might not work in the other. Managers have to be aware of these influences that are independent from the activities themselves.

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