Retained Organizations in IT Outsourcing - Linking Organization Design to Outsourcing Management Problems

IT outsourcing is a strategic option which enables companies to focus on their core competencies. Over time however, many outsourcing arrangements suffer from severe problems. While the design of retained organizations is generally seen as a critical element, there is hardly any empirical evidence on how the choice of the organizational setup is linked to the occurrence of outsourcing management problems later on. In this work, a quantitative study across various outsourcing arrangements is used to identify the key outsourcing management problems and their interdependency with organizational attributes of retained organizations. It is shown that the key problems differ by outsourcing degree, and critical organizational attributes for each of these problems are unveiled. The paper’s objective is to enhance the design of retained organizations to enable more mature and successful outsourcing solutions as well as to provide foundations for future IS research

Domestic Outsourcing in the United States: A Research Agenda to Assess Trends and Effects on Job Quality

The goal of this paper is to develop a comprehensive research agenda to analyze trends in domestic outsourcing in the U.S. -- firms' use of contractors and independent contractors -- and its effects on job quality and inequality. In the process, we review definitions of outsourcing, the available scant empirical research, and limitations of existing data sources. We also summarize theories that attempt to explain why firms contract out for certain functions and assess their predictions about likely impacts on job quality. We then lay out in detail a major research initiative on domestic outsourcing, discussing the questions it should answer and providing a menu of research methodologies and potential data sources. Such a research investment will be a critical resource for policymakers and other stakeholders as they seek solutions to problems arising from the changing nature of work

Governance of Offshore IT Outsourcing at Shell Global Functions IT-BAM Development and Application of a Governance Framework to Improve Outsourcing Relationships

The lack of effective IT governance is widely recognized as a key inhibitor to successful global IT outsourcing relationships. In this study we present the development and application of a governance framework to improve outsourcing relationships. The approach used to developing an IT governance framework includes a meta model and a customization process to fit the framework to the target organization. The IT governance framework consists of four different elements (1) organisational structures, (2) joint processes between in- and outsourcer, (3) responsibilities that link roles to processes and (4) a diverse set of control indicators to measure the success of the relationship. The IT governance framework is put in practice in Shell GFIT BAM, a part of Shell that concluded to have a lack of management control over at least one of their outsourcing relationships. In a workshop the governance framework was used to perform a gap analysis between the current and desired governance. Several gaps were identified in the way roles and responsibilities are assigned and joint processes are set-up. Moreover, this workshop also showed the usefulness and usability of the IT governance framework in structuring, providing input and managing stakeholders in the discussions around IT governance

Improving outcomes in outsourced product development: a joint consultant-client perspective

Although firms increasingly outsource front end product development activities to production suppliers or design consultants, this practice has received little scholarly attention. The few existing academic studies report high failure rates but generally present only the client firms’ view of the causes. Our first results from in-depth interviews of both clients and consultants give a richer picture of enablers of success and causes of failure. We confirm some previous findings(internal divisions within the client, “poor communication” between parties),identify new ones (inadequate client capabilities, failure to transfer design intent), and combine them into a comprehensive model of outsourced product development that includes negotiating project scope, continuously managing expectations, and carefully re-integrating the design output into the client’s operations. Finally, we classify several types of client dependency (need for new ideas, extra capacity, or specific technical expertise) and highlight the particular hazards associated with each

Domestic Outsourcing, Rent Seeking, and Increasing Inequality

An increasing share of the economy is organized around financial capitalism, where, in contrast to the past, capital market actors actively assert and manage their claims on wealth creation and distribution. These new actors challenge prior assumptions of managerial capitalism about the goals and governance of firms. The focus on shareholder value is credited with increasing firm efficiency and shareholder returns. This lecture analyzes the changes in organizational behavior and value extraction under financial capitalism

Towards Multi-Sourcing Maturity: A Service Integration Capability Model

When outsourcing IT services, many enterprises today resort to multi-sourcing. It allows them to reduce costs and assemble a best-of-breed service portfolio. However, this usually also increases complexity. Despite the economic importance of multi-sourcing, though, there is no systematic understanding of the capabilities required to successfully integrate interdependent services and to manage multi-sourcing. This paper develops a capability model for service integration in a grounded coding approach based on literature and expert interviews. The model identifies six key capabilities and 18 sub-capabilities. We evaluate its applicability and validity via an empirical survey and two in-depth case studies. In addition, provide various insights into the implementation of service integration functions. Our contribution should provide orientation for companies how to direct their transformation efforts. It outlines an agenda for future research and builds a solid foundation for maturity models to improve multi-sourcing readiness – ultimately leading to more effective multi-sourcing solutions

The Economics Of System Integration: Toward An Evolutionary Interpretation.

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Domestic Outsourcing in the United States: A Research Agenda to Assess Trends and Effects on Job Quality

The goal of this paper is to develop a comprehensive research agenda to analyze trends in domestic outsourcing in the United States—firms’ use of contractors and independent contractors—and its effects on job quality and inequality. In the process, we review definitions of outsourcing, the available scant empirical research, and limitations of existing data sources. We also summarize theories that attempt to explain why firms contract out for certain functions and assess their predictions about likely impacts on job quality. We then lay out in detail a major research initiative on domestic outsourcing, discussing the questions it should answer and providing a menu of research methodologies and potential data sources. Such a research investment will be a critical resource for policymakers and other stakeholders as they seek solutions to problems arising from the changing nature of work