Outsourcing and Off shoring in the IT industry

by

TABLE OF CONTENTS

CHAPTER 1: INTRODUCTION3

Background of the Study3

Purpose of the Study3

Aims and Objectives4

Rationale5

CHAPTER 2: LITERATURE REVIEW6

Outsourcing6

Factors of Outsourcing7

IT Outsourcing8

Advantages of Outsourcing9

Issues of Outsourcing and Off Shoring in the IT Industry9

CHAPTER 3: METHODOLOGY12

Questionnaire Survey12

Focus Group12

Reliability13

Research Validity13

Ethical Considerations14

REFERENCES15

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 outsourcing. Along with it's so many advantages, there are also some issues and challenges which the companies face while going for the information technology outsourcing.

Aims and Objectives

The aim of the paper is to investigate into the outsourcing relationship in projects to facilitate improvement in Client-Vendor relationships through relational investments. This research aims to identify specific areas clients' relational investments will strengthen C-V partnerships. For this to happen Vendors' perspectives were sought to identify those areas based on interview-based inputs. Many have recognised the importance of client's relational investments, suggesting that the greatest outsourcing benefits accrue to the clients that actively participate in developing an interactive relationship with the vendors. Due to the key role of relational investments in building a cumulative partnership it is highly essential to study the various factors leading to it.

In order to achieve this, the proposed research has derived the following objectives:

To access the benefits and limitations of outsourcing arrangements in IT Projects.

To study the theories and definition of outsourcing along with the various stages of IT outsourcing that is being followed by organizations.

To investigate the factors that needs to be in place to effective client-vendor relationship.

To study the Partnership Maturity Curve (PMC) which categorizes clients into three dynamic stages, and predicts their potential for developing mature partnerships based on their outsourcing objectives and their fit with vendors' capabilities.

Identifying the major challenging areas that vendors face in a relational investment: ...