Outsourcing and Off Shoring in the IT Industry

by

ACKNOWLEDGEMENT

I would take this opportunity to thank my research supervisor, family and friends for their support and guidance without which this research would not have been possible.

DECLARATION

I [type your full first names and surname here], declare that the contents of this dissertation/thesis represent my own unaided work, and that the dissertation/thesis has not previously been submitted for academic examination towards any qualification. Furthermore, it represents my own opinions and not necessarily those of the University.

Signed __________________ Date _________________

ABSTRACT

Outsourcing is a strategic way to utilize outside services and perform the activities that are traditionally handled by internal staff and resources. They further state it is a way to outsource major, non-core functions to specialized efficient providers. This has been a practice for companies for years when they call in a consultant and give that person the responsibility and accountability to do the work. Outsourcing is defined as the firm's reliance on outsourcing determined by the percentage of functions outsourced and the average portion of the each activity that is outsourced.

TABLE OF CONTENTS

ACKNOWLEDGEMENTII

DECLARATIONIII

ABSTRACTIV

CHAPTER 1: INTRODUCTION1

Background of the Study1

Purpose of the Study1

Aims and Objectives2

Rationale3

CHAPTER 2: LITERATURE REVIEW4

Outsourcing4

Definition of Outsourcing5

History of Outsourcing6

Characterizing Outsourcing9

Factors of Outsourcing12

The State of Outsourcing13

Types of Outsourcing21

Outsourcing Drivers23

Outsourcing Success and Business Performance24

Organizational Controls and Outsourcing26

Outsourcing Risks27

IT Outsourcing32

Information Technology in Employee Productivity35

Advantages of Outsourcing36

Disadvantages of Outsourcing37

Cloud Computing38

Effect on IT Professionals40

Issues of Outsourcing and Off Shoring in the IT Industry41

Outsourcing Issues Telephone Systems for Call Centres42

Organisational Control and Outsourcing43

Perceived Challenges44

Selective Outsourcing44

The Art of Multisourcing45

Multisourcing and Modularity47

CHAPTER 3: METHODOLOGY48

Questionnaire Survey48

Focus Group48

Literature Search49

Philosophical Framework or Paradigm49

Reliability53

Research Validity53

Confidentiality54

Ethical Considerations54

CHAPTER 4: FINDINGS56

Results56

Focus Group Discussion58

Discussion64

CHAPTER 5: CONCLUSION68

Limitations of the Study71

Implications for Future Research72

REFERENCES76

CHAPTER 1: INTRODUCTION

Background of the Study

An increasing attention has been seen in building successful partnership in Information Systems Outsourcing. This is because many firms believe in high quality information system services to have a competitive edge over others. A client-vendor (C-V) partnership ensures that client get the best out of the outsourcing of IS functions. However, broken contracts results in unsuccessful C-V partnership. This unhealthy relationship among client and vendor results in causing high transition costs to the clients and interrupted revenues to the vendor.

This paper aims at placing two critical determinants in front of the audiences in order to have a successful C-V partnership i.e. client's outsourcing objective and its fit with vendor's capabilities. A Partnership Maturity Curve (PMC) would be drawn to analyse the best possible way of client-vendor fit. This curve will match client's outsourcing objectives to that of the vendor's capabilities. For example an outsourcing-centric client intend to forge a mature C-V partnership and a relational synergy emerging from this can lead to expand the skill set for both the client and vendor in their respective line of businesses (LObs).

Purpose of the Study

The main purpose of this research proposal is to understand the different issues which the companies face in information technology outsourcing. Information technology is growing day by day, and companies are going for the adoption of information technology ...