Commenced in January 2007
Frequency: Monthly
Edition: International
Paper Count: 33093
Information Systems Outsourcing Reasons and Risks: An Empirical Study
Authors: Reyes Gonzalez, Jose Gasco, Juan Llopis
Abstract:
Outsourcing, a management practice strongly consolidated within the area of Information Systems, is currently going through a stage of unstoppable growth. This paper makes a proposal about the main reasons which may lead firms to adopt Information Systems Outsourcing. It will equally analyse the potential risks that IS clients are likely to face. An additional objective is to assess these reasons and risks in the case of large Spanish firms, while simultaneously examining their evolution over time.Keywords: Information Systems, Information Technologies, Outsourcing, Reasons, Risks, Survey.
Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1332510
Procedia APA BibTeX Chicago EndNote Harvard JSON MLA RIS XML ISO 690 PDF Downloads 3274References:
[1] IDATE Foundation (2005). "Digiworld 2005. Los retos del mundo digital" IDATE-ENTER, Montpellier, France. Internet Document. http://enter.es/enter/file/espanol/texto/digiworld.2005.pdf
[2] S. Takahashi and P. Sayer (2007). "European IT/Telecom Converged Service Delivery Outsourcing Deals: H1 2006. The Battle Rages Between IT And Telecom Service Providers". Internet document. http://www.forrester.com/rb/search/results.jsp?No=25&N=50174
[3] Forrester. (2004). "Europe-s IT services spending will grow by 57 percent from 2003 to 2008". Internet Document. http://www.tsystems. com/ipl2/statistics/923/downloads/press_kits/).
[4] ZDNet (2007) "87% of Outsourcing Buyers to Continue Outsourcing", Internet Document. http://blogs.zdnet.com/ITFacts/index.php?cat=29
[5] Khan (2007). "Outsourcing Not Slowing Down: Study", Internet Document, download 13/12/2007. http://www.ddj.com/architect/197005853?cid=RSSfeed_DDJ_All
[6] KPMG (2007). "Strategic Evolution. A Global Survey on Sourcing Today". Internet Document. http://www.kpmg.com.au/Portals/0/rasita_strategic-evolution200701.pdf
[7] R. Gonzalez; J. Gasco and J. Llopis (2006a). "Information Systems Outsourcing: a Literature Analysis", Information & Management, Vol. 43, No. 7, pp. 821-834.
[8] Ch, Harland; L. Knight; R. Lamming and H. Walker (2005). "Outsourcing: Assessing the Risk and Benefits for Organisations, Sectors and Nations", International Journal of Operations & Production Management. Vol. 25, No. 9/10, pp. 831-850.
[9] S. Paisittanand and D.L. Olson (2006). "A Simulation Study of IT Outsourcing in the Credit Card Business", European Journal of Operational Research. Vol. 175, No. 2, pp. 1248-1261.
[10] D-H. Yang; S. Kim; Ch. Nam and J-W. Min (2007). "Developing a Decision Model for Business Process Outsourcing", Computers and Operations Research, Vol. 34, No. 2, pp. 3769-3778.
[11] Ch. Lin; G. Pervan and D. McDermid (2007). "Issues and recommendations in Evaluating and Managing the benefits of Public Sector IS/IT Outsourcing", Information Technology & People, Vol. 20, No. 2, pp. 161-183.
[12] H. Taylor (2006). "Critical risks in outsourced IT projects; the intractable and the unforeseen", Communications of the ACM, Vol. 49, No. 11, pp. 74-79.
[13] K-M. Osei-Bryson and O.K. Ngwenyama (2006). "Managing Risks in Information Systems Outsourcing: An approach to analyzing outsourcing risks and structuring incentive contracts", European Journal of Operational Research, Vol. 174, No. 1, pp. 245-264.
[14] G. Gupta and H. Gupta (1992). "Outsourcing the IS function. Is it necessary for your organization?", Information Systems Management, Vol. 9, No. 3, pp. 44-50.
[15] V. Grover; M.J. Cheon and T.C. Teng (1996). "The Effect of Service Quality and Partnership on the Outsourcing of Information Systems Functions", Journal of Management Information Systems, Vol. 12, No. 4, pp. 89-116.
[16] D.C. Hayes; J.E. Hunton and J.J. Reck (2000). "Information Systems Outsourcing Announcements: Investigating the Impact on the Market Value of Contract-Granting Firms", Journal of Information Systems, Vol. 14, No. 2, pp. 109-125.
[17] M. Lacity; R. Hirschheim and L. Willcocks (1994). "Realizing Outsourcing Expectations. Incredible Expectations, Credible Outcomes", Information Systems Management, Vol. 11, No. 4, pp. 7-18.
[18] M.A. Smith; S. Mitra, and S. Narasimhan (1998). "Information Systems Outsourcing: A Study of Pre-Event Firm Characteristics", Journal of Management Information Systems, Vol. 15, No. 2, pp. 61-93.
[19] L. Willcocks; D. Feeny and N. Olson (2006). "Implementing Core IS Capabilities: Feeny-Willcocks IT Governance and Management Framework Revisited", European Management Journal, Vol. 24, No. 1, pp. 28-37.
[20] V. Grover; M.J. Cheon and T.C. Teng (1994). "A Descriptive Study on the Outsourcing of Information Systems Functions", Information & Management, Vol. 27, No. 1, pp. 33-44.
[21] M. Alner (2001). "The Effects of Outsourcing on Information Security", Information Systems Security, Vol. 10, No. 2, pp. 35-43.
[22] T.D. Clark; R.W. Zmud and G.E. McCray (1995). "The Outsourcing of Information Services: Transforming the Nature of Business in the Information Industry", Journal of Information Technology, Vol. 10, pp. 221-237.
[23] J. Jurison (1995). "The Role of Risk and Return in Information Technology Outsourcing Decisions", Journal of Information Technology, Vol. 10, No. 4, pp. 239-247.
[24] L.P. Baldwing; Z. Irani and P. Love (2001). "Outsourcing Information Systems: Drawing Lessons from a Banking Case Study", European Journal of Information Systems, Vol. 10, No. 1, pp. 15-24.
[25] M. Lacity and R. Hirschheim (1993a). "Implementing Information Systems Outsourcing: Key Issues and Experiences of an Early Adopter", Journal of General Management, Vol. 19, No. 1, pp. 17-31.
[26] F.W. McFarlan and R.L. Nolan (1995). "How to Manage an IT Outsourcing Alliance", Sloan Management Review, Vol. 36, No. 2, pp. 8- 23.
[27] S. Ang and D. Straub (1998). "Production and Transaction Economies and IS Outsourcing: A Study of the U.S. Bank Industry", MIS Quarterly, Vol. 22, No. 4, pp. 535-552.
[28] S. Slaughter and S. Ang (1996). "Employment Outsourcing in Information Systems", Communications of the ACM, Vol. 39, No. 7, pp. 47-54.
[29] D.L. Olson (2007). "Evaluation of ERP Outsourcing", Computers & Operation Research, Vol. 34, No. 12, pp. 3715-3724.
[30] R. Gonzalez; J. Gasco and J. Llopis (2006b). "Information Systems Offshore Outsourcing: A Descriptive Analysis", Industrial Management & Data Systems. Vol. 106, No. 9, pp. 1233-1248.
[31] E. Claver; R. Gonzalez; J. Gasco and J. Llopis (2002). "Information Systems Outsourcing: Reasons, Reservations and Success Factors", Logistics Information Management, Vol. 15, No. 4, pp. 294-308.
[32] R. Gonzalez; J. Gasco and J. Llopis (2005a). "Information Systems Outsourcing Reasons in the Largest Spanish Firms", International Journal of Information Management. Vol. 25, No. 2, pp. 117-136.
[33] M. Lacity and R. Hirschheim (1993b). "The Information Systems Outsourcing Bandwagon", Sloan Management Review, Vol. 35, No. 1, pp. 73-86.
[34] L. Loh and N. Venkatraman (1992). "Diffusion of information technology outsourcing: influence sources and the Kodak effect". Information Systems Research, Vol. 3, No. 4, pp. 334-358.
[35] B. Jiang and A. Qureshi (2006). "Research on Outsourcing Results: Current Literature and Future Opportunities", Management Decision, Vol. 44, No. 1, pp. 44-55.
[36] Fowler and B. Jeffs (1998). "Examining Information Systems Outsourcing: A Case Study from The United Kingdom", Journal of Information Technology, Vol. 13, No. 2, pp. 111-126.
[37] R.L. Glass (1996). "The End of the Outsourcing Era", Information Systems Management, Vol. 13, No. 2, pp. 89-91.
[38] M.H.A. Tafti (2005). "Risk factors associated with offshore IT outsourcing", Industrial Management & Data Systems, Vol. 105, No. 5, pp. 549-560.
[39] O.K. Ngwenyama and W.E. Sullivan (2007). "Outsourcing Contracts as Instruments of Risk Management. Insights from two Successful Public Contracts", Journal of Enterprise Information Management, Vol. 20. No. 6, pp. 615-640.
[40] M.G. Martinsons (1993) "Outsourcing Information Systems: A Strategic Partnership with Risk", Long Range Planning, Vol. 26, No. 3, pp. 18-25.
[41] F. Guterl (1996). "How to Manage your Outsourcer?", Datamation, Vol. 42, No. 5, pp. 79-83.
[42] M.J. Earl (1996). "The Risk of Outsourcing IT", Sloan Management Review, Vol. 37, No. 3, pp. 26-32.
[43] L.P. Willcocks and M.C. Lacity (1999). "IT Outsourcing in Insurance Services: Risk, Creative Contracting and Business Advantage", Information Systems Journal, Vol. 9, No. 3, pp. 163-180.
[44] L.P. Willcocks; M.C. Lacity and T. Kern (1999). "Risk Mitigation in IT Outsourcing Strategy Revisited: Longitudinal Case Research at LISA", Journal of Strategic Information Systems, Vol. 8, No. 3, pp. 285-314.
[45] L.P. Willcocks; Lacity, M.C. and Fitzgerald, G. (1995). "Information Technology Outsourcing in Europe and the USA: Assessment Issues", International Journal of Information Management, Vol. 15, No. 5, pp. 333-351.
[46] J. Barthélemy (2001). "The Hidden Cost of IT Outsourcing", MIT Sloan Management Review, Vol. 42, No. 3, pp. 60-69.
[47] D. Whitten and R.L. Wakefield (2006). "Measuring Switching Costs in IT Outsourcing Services", Journal of Strategic Information Systems, Vol. 15, pp. 219-248.
[48] I. Hurst and B.G. Hanessian (1995). "Navigating IT Channels: Integrate or Outsource?", The McKinsey Quarterly, No. 3, pp. 103-110.
[49] D. Fink (1994). "A Security Framework for Information Systems Outsourcing", Information Management & Computer Security, Vol. 2, No. 4, pp. 3-8.
[50] P.C. Palvia (1995). "A Dialectic View of Information Systems Outsourcing: Pros and Cons", Information & Management, Vol. 29, No. 5, pp. 265-275.
[51] E.A. Walden and J.J. Hoffman (2007). "Organizational form, incentives and the management of Information Technology Opening the black box of Outsourcing", Computers & Operations Research, Vol. 34, No. 12, pp. 3575-3591.
[52] L.P. Willcocks and G. Fitzgerald (1996). "IT Outsourcing and the Changing Shape of the Information Systems Function", in: Earl, M.J. (Ed.), Information Management. The Organizational Dimension, Oxford University Press, Oxford, pp. 270-294.
[53] M.F. Corbett (1994). "Outsourcing and the New IT Executive. A Trends Report", Information Systems Management, Vol. 11, No. 4, pp. 19-22.
[54] R. Gonzalez; J. Gasco and J. Llopis (2005b). "Information Systems Outsourcing Risks: A Study of Large Firms", Industrial Management & Data Systems, Vol. 105, No. 1. pp. 45-62.
[55] N. Brooks (2006) "Understanding IT Outsourcing and its Potential Effects on IT Workers and Their Environment", The Journal of Computer Information Systems, Vol. 46, No. 4, pp. 46-53.
[56] J-N. Lee; S-M. Miranda and Y-M. Kim (2004). "IT Outsourcing Strategies: Universalistic, Contingency, and Configurational Explanations of Success", Information Systems Research, Vol. 15, No. 2, pp. 110-131.
[57] B. Bahli and S. Rivard (2005). "Validating Measures of Information Technology Outsourcing Risks Factors", Omega, Vol. 33, No. 2, pp. 175-187.
[58] Q. Ma; J.M. Pearson and S. Tadisina (2005). "An Exploratory Study into Factors of Service Quality for Application Service Providers", Information & Management, Vol. 42, No. 4, pp. 1067-1080.
[59] Z. Shi; A.S. Kunnathur and T.S. Ragu-Nathan (2005). "IS Outsourcing Management Competence Dimensions: Instrument Development and Relationship Exploration", Information & Management, Vol. 42, No. 6, pp. 901-919.
[60] L. Poppo and T. Zenger (1998). "Testing alternative theories of the firm: transaction cost, knowledge-based, and measurement explanations for make-or-buy decisions in information services", Strategic Management Journal, Vol. 19, No. 9, pp.853-877.
[61] M. Casadesus and S. Karapetrovic (2005). "Has ISO 9000 lost some of its lustre? A longitudinal impact study", International Journal of Operations and Production Management, Vol. 25, No. 6, pp. 580-596.
[62] IDC (2005). "Estudio sobre el atractivo de Espa├▒a como destino del Nearshore". Internet Document unloaded 16 September 2005. http://www.idc.com/spain/downloads/research/fs_nearshore.pdf
[63] S. Kumar (2006). "A Comparative Analysis of Key Information Technology Players", Technovation, Vol. 26, No. 7, pp. 836-846.
[64] G. Capaldo; M. Raffa and G. Zollo (1995). "Factors influencing successful implementation in computer based technologies in knowledge-intensive activities", Information Resources Management Journal, Vol. 8, No. 4, pp. 29-37.
[65] L-N. Lee (2001). "The impact of knowledge sharing, organizational capability and partnership quality on IS outsourcing success". Information & Management. Vol. 38, No. 5, pp. 323-335.
[66] V. Wadhwa, V. and R. Ravindran (2007). "Vendor Selection in Outsourcing", Computers & Operations Research, Vol. 24, No. 12, pp. 3725-3737.
[67] A. Mojsilovic; B. Ray; R. Lawrence and S. Takriti, S. (2007). "A Logistic Regression Framework for Information Technology Outsourcing Lifecycle Management", Computers & Operations Research, Vol. 34, No. 12, pp. 3609-3627.