Contracts and Partnerships in the Outsourcing of IT

This paper reports on a recent research study conceming the outsourcing of information technology activities in the United Kingdom. The study involved a large survey and a set of detailed case studies based on large and medium sized organizations. In particular the issues of contracts and partnerships are examined, which is identified as one of the key elements in successful outsourcing. The authors show the variety of approaches and perceptions that exist concerning these issues, and conclude that &ere Is much misunderstanding, particularly in relation to partnership. The paper concludes by creating a framework for helping to identify and examine the interrelationship between contractual arrangements, the required degree of contractual definition, and the characteristics of the area being outsourcecl

Private military services in the UK and Germany: Between partnership and regulation1

Controversial cases such as the aborted coup in Equatorial Guinea and the employment of private contractors in the Abu Ghraib prison have brought the proliferation of private ‘mercenaries’ to worldwide attention. However, the privatization of military security is more diverse and complex than generally suggested. Specifically, one needs to distinguish between the use of private mercenaries in developing countries and the privatization of military services in Europe. Focussing on the latter, this article proposes that the privatization of military services in industrialized countries can be understood in terms of a shift from ‘government’ to ‘governance’. As a consequence, the emergence of a private military industry in Europe is not only characterized by distinct forms of governance failure; European governments have also developed new modes of governance to control the industry. Using the United Kingdom and Germany as examples, this article examines two modes in particular: public private partnerships and governmental regulation

Transparency and the performance of outsourced government services

The Office of the Information Commission Queensland / ANZSOG Occasional Paper series aims to objectively evaluate the available evidence about whether openness can be a far more powerful tool than secrecy in serving the public interest. Where transparency can be used as a tool, the series also identifies the practical application and the lessons learnt so far. Importantly, it seeks to articulate the case for transparency by showing how transparency can be used as a means to the end: effective policy implementation while minimising costs to the taxpayer.  The latest paper in the series is by Richard Mulgan of ANU, and examines transparency and the performance of outsourced government services. It discusses three aspects of outsourcing: value-for-money efficiency, effectiveness of performance, and publicity of performance information, and explores a number of lessons for both government and public sector managers on how to increase the extent of transparency, and thus the quality, of outsourced services

Doctor of Philosophy

dissertationGiven the trend of globalization, more and more firms are outsourcing their Research and Development (R&D) projects to a second party overseas or domestically. Through outsourcing, firms not only save costs but also build strategic capabilities such as tapping global talents, building partnerships, boosting innovation, and maintaining a lean and flexible operation. These capabilities help shorten the duration of R&D projects and mitigate the risk of failures. However, the complexity of collaborative relationship in outsourcing and risks inherent in an R&D project pose challenges to both the firm who is doing the outsourcing (referred to as the principal) and the firm that the project is outsourced to (referred to as the agent). It is likely that either or both parties have private information regarding their capabilities as well as the likelihood of the success of the project. In addition, the efforts of the firm that the project is outsourced to may be unobservable to the firm who is doing outsourcing. In the dissertation, I investigate whether stage-gate contracts can help firms manage the outsourcing of R&D projects and determine the optimal form of the stage-gate contract when information asymmetry (adverse selection) and unobservable effort (moral hazard) exist. In Chapter 1, I explore the use of stage-gate contracts in the case where the agent has private information and his effort is unobservable. The principal offers multiple contracts to "screen" the agent. The main tool of the analysis is the screening model in the principalagent problem. In Chapter 2, I examine the opposite case, the one where the principle is the firm with the private information (the agent's effort is again unobservable). In this situation a principal may use the stage-gate contract to signal her private information with regard to the new product development project. The main tool of the analysis is the signaling games. In Chapter 3, I investigate the case of bilateral asymmetric information, namely, both the principal and the agent have their own private information on the project. The main tool of the analysis is the screening model and the signaling games

The state-private interface in public service provision

Political theory sets out a strong case for the state to play a major role in public service provision. Yet services are often provided by a range of state and non-state actors as well as by collaborative partnerships. This paper surveys the literature, seeking to map arrangements in developing countries and to understand the politics of different types of service provision

Views of NHS commissioners on commissioning support provision. Evidence from a qualitative study examining the early development of clinical commissioning groups in England

Objective: The 2010 healthcare reform in England introduced primary care-led commissioning in the National Health Service (NHS) by establishing clinical commissioning groups (CCGs). A key factor for the success of the reform is the provision of excellent commissioning support services to CCGs. The Government's aim is to create a vibrant market of competing providers of such services (from both for-profit and not-for-profit sectors). Until this market develops, however, commissioning support units (CSUs) have been created from which CCGs are buying commissioning support functions. This study explored the attitudes of CCGs towards outsourcing commissioning support functions during the initial stage of the reform. Design: The research took place between September 2011 and June 2012. We used a case study research design in eight CCGs, conducting in-depth interviews, observation of meetings and analysis of policy documents. Setting/participants: We conducted 96 interviews and observed 146 meetings (a total of approximately 439 h). Results: Many CCGs were reluctant to outsource core commissioning support functions (such as contracting) for fear of losing local knowledge and trusted relationships. Others were disappointed by the absence of choice and saw CSUs as monopolies and a recreation of the abolished PCTs. Many expressed doubts about the expectation that outsourcing of commissioning support functions will result in lower administrative costs. Conclusions: Given the nature of healthcare commissioning, outsourcing vital commissioning support functions may not be the preferred option of CCGs. Considerations of high transaction costs, and the risk of fragmentation of services and loss of trusted relationships involved in short-term contracting, may lead most CCGs to decide to form long-term partnerships with commissioning support suppliers in the future. This option, however, limits competition by creating ‘network closure’ and calls into question the Government's intention to create a vibrant market of commissioning support provision

Exploring the role of servitization to overcome barriers for innovative energy efficiency technologies – the case of public LED street lighting in German municipalities

In this paper we analyse the case for public application of LED street lighting. Drawing from the energy services literature and transaction cost economics, we compare modes of lighting governance for modernisation. We argue that servitization can accelerate the commercialisation and diffusion of end-use energy demand reduction (EUED) technologies in the public sector if third party energy service companies (ESCo) overcome technological, institutional and economic barriers that accompany the introduction of such technologies resulting in transaction costs. This can only succeed with a supportive policy framework and an environment conducive towards the dissemination of specific technological and commercial knowledge required for the diffusion process

Protecting workers in PPPs

PPPs create problems for employees. The paper reviews these problems and ways of protecting workers, in the context of EU law and ILO conventions