Information systems outsourcing satisfaction: some explanatory factors

Purpose – The purpose of this paper is to analyse Information Systems outsourcing success, measuring the latter according to the satisfaction level achieved by users and taking into account three success factors: the role played by the client firm’s top management; the relationships between client and provider; and the degree of outsourcing. Design/methodology/approach – A survey was carried out by means of a questionnaire answered by 398 large Spanish firms. Its results were examined using the partial least squares software and through the proposal of a structural equation model. Findings – The conclusions reveal that the perceived benefits play a mediating role in outsourcing satisfaction and also that these benefits can be grouped together into three categories: strategic; economic; and technological ones. Originality/value – The study identifies how some success factors will be more influent than others depending which type of benefits are ultimately sought with outsourcing

An exploration of New Institutional Economics for the strategic analysis of e-business with reference to transformational change

This thesis was submitted for the degree of Docter of Business Administration and awarded by Brunel University on behalf of Henley Management CollegeThis research applies institutional economics theory to management challenges arising in connection with e-business related transformational change. The research was carried out in response to widely recognised problems in managing IT-enabled change in complex organisations. A cyclic approach builds researcher competence in both the chosen theory, New Institutional Economics (NIE), and its application through a series of four contrasting case studies. The case situations, which derive from the researcher’s work as a technology management consultant, are treated as action research experiments which investigate e-business related transformational change in financial services, retail and government settings. A constructivist stance is adopted within the case situations with the researcher acting as a participant observer. Reflective practice is used to improve the experimental method for the case studies through the course of the research, leading to the use of participatory action research (PAR) for the final case. A literature review of NIE shows it to be loosely defined as a theory, so an analytic NIE framework is created to provide a cognitive model. This model is then modified and extended to produce a final theoretical framework. In parallel, a conceptual map of NIE is created from the research as a practical aid to illustrate NIE concepts and linkages. These two models, the theoretical framework and the conceptual map, evolve through the four case situations which were selected from a range of e-business consulting opportunities available to the researcher over the period of the research. The second case study drives the main development of the two models and draws out the necessary and complementary contributions of both transaction cost economics (TCE) and agency theory (AT) as parts of NIE, neither of which is sufficient on its own. The final case study demonstrates application to practice. The overall sequence of case studies shows the researcher’s cognitive growth from being a novice in the theory and its application in the first case through to a level of proficiency in applying NIE to the rigours of e-business practice in the final case. The research makes several contributions to knowledge. It makes a significant methodological contribution by bringing research methods developed for other forms of professional practice to the management discipline. It also makes a significant contribution to theoretical knowledge. It develops two theoretical models of NIE – a conceptual map and a theoretical framework – which present a way of linking NIE concepts in a meaningful way, and a structure by which NIE can be used in the analysis of highly complex organisational situations. These models clarify the complementary roles of TCE and AT, and indicate a reason why so many studies limited to TCE alone have been inconclusive. Applying NIE to the rigours of e-business management produces, in turn, a contribution to IT strategy formulation. The research makes a practical contribution by showing how NIE can be applied to e-business practice, subject to a number of significant caveats. NIE, as a descriptive theory, is shown to provide a powerful conceptual framework when combined with PAR, although both require deep knowledge and skill. In particular, adopting PAR as a case study method depends on an experienced, skilled and committed practitioner for its effective use. Finally, the research finds that NIE’s strengths as a framework for strategic analysis of large scale and complex e-business situations involving transformational change, which make it unduly sophisticated for less challenging situations, mean that NIE is suited to use by highly skilled, specialist consultants rather than by general managers

Success factors in IT Outsourcing

Abstract. To survive and respond to the everchanging business world companies are seeking new ways to concentrate and improve core competencies, as well as improve their competitive status against the market. Companies are exploring how to exploit the core competencies of other companies. The goals of the partnership might differ depending on the scope of the partnership. The goal might be one or many of the following: cost reduction, access to higher quality service, access to technology and/or know-how. Even if the first IT outsourcing was done around 30 years ago by Eastman Kodak and General Dynamics and the area has been studied quite heavily, the topic seems to be still difficult for companies to grasp the wanted benefits. As the IT outsourcing is widely used option in the business world and the results are not firm, I feel the topic is still relevant to study. The research question for the study is: “What factors affect the success of IT outsourcing relationship?” The research question is answered through the literature review. From the literature review eleven high level success factors can be identified. In some cases, some factors are combined. The success factors are Cost and Quality, Trust, Alignment to business strategy, Culture, Communication, Contracts, Strategic Partnership, Governance, Management support, Infrastructure, and Know-how. How important each individual factors are in outsourcing engagement in question depends on the sort of the partnership. The theoretical implications are very limited, but the practical implications regarding communication, trust and governance should be considered when companies enter IT outsourcing partnerships. Putting an emphasis on setting up proper governance functions and people who are good at communicating with the other party will pay the efforts back in success of the relationship

Success factors in IT outsourcing:vendor’s view

Abstract. The world is getting smaller and thus competition gets fiercer. Therefore, companies are seeking new ways to utilize other companies core competencies by partnering with them. The success of these partnerships is important for both parties. Success factors of an IT outsourcing relationship has been studied quite a bit since the first ones took place in 1990’s. However, due to nature of IT, the outsourcing has been seen cumbersome and thus, it is an appealing topic to investigate. The topic of the thesis was to investigate the definition of success and success factors of an IT outsourcing relationship from vendor’s point of view. Consequently, the research questions are: RQ1: What constitutes a successful IT outsourcing relationship from vendor’s point of view? RQ2: Which factors affect IT outsourcing relationship success from vendor’s point of view? The research questions are answered based on the literature review and data produced in semi-structured interviews, utilizing qualitative research methods. In RQ1 the data analysis method was deductive. The RQ2 answer is conducted from factors identified in literature review, and the factors that were listed as success factors, from vendor’s point of view, in the interviews are counted as success factors in this study. RQ1 answer: The successful IT outsourcing relationship from vendor’s point of view is achieved when the pre-set goals are met. The most fundamental goal is to make business. More precisely, the goals usually are mainly monetary, but they can also be related to developing vendor’s capabilities, or other strategic objectives. RQ2 answer: The success factors identified are communication, trust, strategic partners, governance, contract, competence, culture, and management support as well as personal relationships and chemistry. Combined factors affecting the success are information sharing, business understanding, benefit/risk sharing, interdependence, commitment, coordination, and conflict management, and social competence. The factors might be connected to each other, but their connection and importance depends on the nature and situation of the relationship. This research is done from vendor’s point of view, even if the literature review is originally done from both parties’ point of view. None of the success factors directly affect the IT outsourcing relationship to be successful. They however improve the likelihood of longer relationship and make the relationship more reliable source of income. The study introduces two new success factors 1) social competence, 2) personal relationships and chemistry. The practitioners should ensure that the goals are defined before entering into the relationship. The vendor should also make sure that the vendors’ personnel interacting with customers have high social competence, as well as production and technology related competence is sufficient, and the contract suits the delivery

Considerations for Effective Requirements Analysis in Offshore Software Development Projects: Lessons from Multi-method Research

Offshore software development using geographically distributed teams is an accepted practice in software development today. However, software development companies have largely only offshored the software development lifecycle’s coding and testing phases. However, lately, offshoring the requirements analysis (RA) phase has become increasingly viable for several reasons including the software industry’s maturation and improved communication technologies. However, successfully evaluating this highly interactive phase between geographically dispersed client and provider teams requires special considerations. In this paper, we present practical insights garnered from conducting experiments and surveys of IS professionals from the Indian software industry and from extensively examining the literature. Our findings confirm that, subject to certain best practices, one can effectively conduct RA in software projects offshore. We present these practices as lessons learned and provide related recommendations for industry and academia

Vertical Structures in the Global Liquefied Natural Gas Market: Vertical Structures in the Global Liquefied Natural Gas Market: Empirical Analyses Based on Recent Developments in Transaction Cost Economics

During the last decade, the global liquefied natural gas (LNG) market altered substantially. Significant investments have been realized, traded volumes increased and contracting structures gained in flexibility. Various governance forms co-exist, including the poles of spot market transactions and vertical integration as well as numerous hybrid forms such as long-term contracts, joint ventures, and strategic partnerships. This dissertation empirically investigates, based on transaction cost economics and recent extensions thereof, which motivations drive companies towards the choice of hierarchical governance forms. First, the likelihood of vertical integration and the impact of inter-organizational trust as a shift parameter accounting for differences in the institutional environment are analyzed. Estimation results confirm transaction cost economics by showing that relationship-specific investments in an uncertain environment drive LNG companies to invest in successive stages along the value chain. Furthermore, the presence of inter-organizational trust increases the likelihood of less hierarchical governance modes. Second, alternative theories of the firm are linked in order to explain the menu of strategic positions recently observed in this dynamic market. Estimation results support the positioning-economizing perspective of the firm. The three strategic choices of target market position, resource profile, and organizational structure are interdependent. Third, the determinants of optimal contract length as a trade-off between the minimization of transaction costs due to repeated bilateral bargaining and the risk of being bound in an inflexible agreement in uncertain environments is discussed. Estimation results show that the presence of high asset specificity results in longer contracts whereas the need for flexibility in today’s LNG market supports shorter agreements. When firms have experience in bilateral trading, contract duration decreases. In addition, countries heavily reliant on natural gas imports via LNG are often willing to forgo some flexibility in favor of supply security. Contracts dedicated to competitive downstream markets on average are shorter than those concluded with customers in non-liberalized importing countries

The Dilemmas Of Public (Middle) Managers Under NPM: Implementing Public Service Outsourcing In Ghana’s Health Sector

Globally, public management underwent substantial reforms over the past three decades. Known as new public management (NPM), reforms have sought to redefine the role of politicians and public managers, redesign public organisations for enhanced autonomy and effectiveness, and restructure service delivery by integrating private organisations to ensure competition believed as necessary for efficiency. Premised on tensional forces of public choice' and `managerialism' the NPM model potentially creates conflicts between managers and professionals. Developed in OECD countries, and applied to less developed countries (LCDs) with generally ineffective public sectors; and admittedly an engrained corruption culture, NPM reforms are typified by increased bureaucratic centralisation, which restricts professionals' discretion. Using semi-structured interviews and a range of qualitative analytic devices, this thesis examines the challenges professional managers encounter under senior managers, when some support functions were privately outsourced, in line with NPM, in two corporatised hospitals in Ghana. Findings suggest professionals feel by-passed, their discretion restricted, and their expertise ignored by senior managers, generating clashes over mediating the conflicting dualities of cost/quality, results/procedures, and output/outcome. Conceptualised as resistance strategies, professionals' response(s) to the encountered issues portrayed appreciable unconventionality and non-deviance, coming close to individualised version of work to rule, and professionalised version of weapons of the weak. Such professionals' resistance strategies elucidate the complexities of Ghana's embedded political, economic and socio-cultural context. The findings suggest the true outcomes of NPM reforms within this and similar contexts are masked, distorted by the refracting effects of corruption, producing a type of bureaucracy that encourages reduced devolution, tending to inhibit rather than aid effective delivery of public services

Empirical analysis of information technology and business process outsourcing

Diese Dissertation befasst sich in drei empirischen Aufsätzen mit der Auslagerung von Informationstechnologien (IT) und Geschäftsprozessen. Der erste Beitrag untersucht die Auswirkung von IT-Outsourcing auf die Arbeitsproduktivität der auslagernden Unternehmen, wobei ein Endogenous Switching Regression Modell im Rahmen einer Cobb-Douglas Produktionsfunktion verwendet wird. Die Ergebnisse zeigen, dass Mitarbeiter, die hauptsächlich mit einem Computer arbeiten, produktiver sind in Unternehmen die IT auslagern. Daher kann die Computernutzung und IT Outsourcing als komplementäre Faktoren betrachtet werden, die sich beide positiv auf die Arbeitsproduktivität auswirken. Der zweite Aufsatz befasst sich mit der Wirkung von IT Outsourcing auf das Beschäftigungswachstum. Während Outsourcing zumindest kurzfristig oftmals mit einem Beschäftigungsabbau in den auslagernden Unternehmen assoziiert wird, können die mittel- bis langfristigen Auswirkungen von Outsourcing durchaus positiv sein. Durch einen Instrumentalvariablenansatz wird für mögliche Endogenität zwischen Beschäftigungswachstum und IT Outsourcing kontrolliert. Die empirischen Ergebnisse sprechen dafür, dass sich Outsourcing mittelfristig positiv auf das Beschäftigungswachstum der Unternehmen auswirkt. Allerdings zeigt eine separate Betrachtung des verarbeitenden Gewerbes und von Dienstleistungsunternehmen, dass dieser positive Effekt nur für letztere signifikant ist. Der dritte und letzte Beitrag untersucht die Auswirkung der Auslagerung von IT nahen Geschäftsprozessen auf die Unternehmensproduktivität. Diese Analyse basiert auf Paneldaten. Um Verzerrungen durch nicht beobachtbare Heterogenität von Firmen, Messfehler der Variablen und Simultanität der In- und Outputs zu erfassen, werden verschiedene Schätzverfahren im Rahmen einer Cobb-Douglas Produktionsfunktion verwendet. Die Ergebnisse zeigen einen signifikanten positiven Effekt der Auslagerung von Geschäftsprozessen auf die Produktivität der Unternehmen.This thesis consists of three essays that contribute to the empirical literature on information technology (IT) and business process outsourcing. The first essay analyses the impact of information technology outsourcing on labour productivity in outsourcing firms by using an endogenous switching regression model in a Cobb-Douglas production function framework. Estimation results show that employees who mainly work with a computer are more productive in firms conducting IT outsourcing. Therefore, computer usage and IT outsourcing can be interpreted as complementary factors that positively affect firms’ labour productivity. The second essay refers to the employment effects of IT outsourcing. Even though, in most cases outsourcing is widely associated with accompanied job losses in outsourcing firms, the medium and long term effects of outsourcing can absolutely still be positive. The analysis is conducted by using an instrumental variable approach to account for possible endogeneity between the employment growth rate and IT outsourcing. Estimation results provide empirical evidence that IT outsourcing has a positive effect on a firms’ medium-term employment growth rate. However, dividing the sample into manufacturing and service firms, a significant medium-term positive growth effect of IT outsourcing can only be observed for firms operating in the service sector. Finally, the last essay takes a close look at the impact of IT-related business process outsourcing on firm productivity. This analysis is based on panel data. In order to account for unobserved firm heterogeneity, measurement errors in the variables and simultaneity of inputs and output, different estimation techniques are applied to estimate a Cobb-Douglas production function model. The results clearly reveal a positive and significant impact of business process outsourcing on firm-level productivity

Making the Sourcing Decision of Software Maintenance and Information Technology

Outsourcing has been getting a significant growth for the last few years. Organizations tend to outsource Information Technology (IT), primarily to take advantage of the availability of qualified, trained and skilled workforce in low cost countries across the globe. Outsourcing of IT and software maintenance seem very promising, but a number of factors, risks, and challenges associated with the outsourcing process that make the sourcing decision very complicated. The present study aimed at gaining in-depth understanding of the three aspects of outsourcing, namely; perceived benefits of IT outsourcing, influencing factors of IT outsourcing and software maintenance offshoring. The findings of the current study will lead us to develop a sourcing framework for outsourcing decision as well as a decision support system for software maintenance. A systematic literature review is performed that presents perceived benefits of IT outsourcing, the influencing factors of IT outsourcing and software maintenance. Furthermore, the identified factors are analyzed based on their occurrences in literature as well as chi square test is performed to derive the significant differences amongst the factors based on decades. Similarly, critical success factors are derived both for IT outsourcing and software maintenance offshoring. Our article shows that how the critical success factors impact the IT as well the software maintenance in global delivery perspective. The findings of the current study will help the IT experts and decision makers in making suitable sourcing decisions.Qatar University [IRCC-2020-009]