Key Issues for Global it Sourcing: Country and Individual Factors

Globalization trends, trade liberalization in developing countries, quantum improvements in worldwide telecommunications infrastructures, and cost-cutting pressures have together compelled many companies to examine global opportunities for sourcing some of their IT operations. Such global sourcing, whether it involves insourcing or outsourcing, requires IT project managers to deal with issues unique to operating in heterogeneous international environments. This article examines the influences of country-level and individual-level factors on the effective management of offshore IT sourcing relationships and offers a set of best practices that project managers should consider when entering into such global arrangements.     

Building outsourcing relationships across the global community: the UPS–Motorola experience

The United Parcel Service (UPS)–Motorola case study revolves around two major areas of information technology (IT) management: IT as a competitive tool and global outsourcing of IT projects. It provides an opportunity to become familiar with the decisions and actions taken by UPS to assure their competitive advantage in the turbulent courier services industry. In the IT outsourcing area, the case addresses managerial and technical issues associated with outsourcing IT projects across the global community. The case presents the specific factors that made this outsourcing project successful and discusses the development of the outsourcing relationships between UPS and Motorola (Israel), from initial negotiations to the creation of a strategic alliance between the two companies. A major point in this case is the gradual development of trust between the two sides, trust that led the two firms from being committed to a contract to becoming strategic partners.     

Outsourcing in the private and public sectors: an unpredictable IT strategy

IT outsourcing has grown considerably in the private sector, with IT software and service suppliers reporting increased revenues. Similarly in the public sector, the introduction of market testing and compulsory competitive tendering (CCT) will inevitably lead to the contracting-out of significant levels of IT work. This may lead to the demise of some public sector IT departments where external bids are favoured over those offered by the in-house team. This paper is divided into two sections. First, it considers some of the relevant literature on IT outsourcing in both private and public sector British and American organizations. It draws together important themes which explain the attraction of IT outsourcing to senior executives. Second, it introduces the results from a questionnaire survey of nearly 200 UK private and public sector organizations on IT outsourcing. In particular it looks at the proportion of organizations that claims to use outsourcing, how contracts are negotiated and the type of IT solutions preferred by IT managers. The central argument is that IT outsourcing poses significant challenges to both private and public sector organizations and is not simply a quick-fix panacea. Moreover, public sector IT managers would do well to analyse some of the less favourable reports from private sector outsourcing as they gear themselves up for CCT in the months ahead.     

软件开发外包项目管理案例分析及探索

软件外包是一个非常大的市场,目前在国内有很多软件公司从事软件项目外包行业,或把自己的部分业务发包给外包方,软件项目外包管理随着近年软件项目外包的发展越来越受到重视,它与公司项目的内容管理既关联又存在差异,文章通过对企业实际外包项目的具体案例的风险进行分析,提出了相应的解决方案,并总结了项目实施过程中存在的问题及改进意见,为软件企业的外包项目管理提供了借鉴。     

我国IT服务行业的发展前景与人才储备需求分析

随着经济全球化发展趋势加快和市场竞争的加剧,如何专注自己的核心业务已经成为企业最重要的生存法则之一.2000年至今,全球IT服务外包业务高速增长带动了全球IT服务外包产业的快速发展,IT服务企业雨后春笋一般纷纷成长起来,但IT服务企业数量和规模还远远不够,IT服务人才短缺和结构的不合理严重制约了我国IT服务外包产业的快速发展.随着中国IT技术市场与国际标准的全面接轨,IT服务人才的培养和储备已经成为我国与各国IT服务行业之间竞争的主要砝码.本文分析了我国IT服务行业的发展前景,以及对IT服务人才的潜在需求,以帮助IT服务企业做好人力资源规划,同时也为高等学校培养IT服务人才提供参考依据.     

Wearing two hats: analyst-managers for small software projects

With the evolution of software development, companies have changed their project methodology and are asking IT employees to evolve with them. The business analyst talks to users, ironing out the details of what they wanted and balancing that wish list against what an IT system could economically or practically deliver. The business analyst also ensures that users develop business processes to support the software. The actual task of writing the software falls to a project manager and his team of software developers. Today, companies commonly ask IT managers to assume the business analyst role in addition to their duties as project manager, especially in small projects. This article discusses how IT managers can successfully navigate the thin line between business analyst and project manager.     

Information Technology Investments: Characteristics, Choices, Market Risk and Value

The decisions confronting information technology (IT) managers have changed a great deal since the early 1970s. The key decisions three decades ago were related to the management of application development projects and operations centers. Today, the key decisions are quite different. What level of service should the firm provide end-users? Should IT services, development projects and the ownership and management of operations centers be outsourced? IT investments attempt to satisfy specific needs. Because of environmental differences and differences in the cost structure and benefits of alternative ways in which these needs can be met, the answers to these questions may differ across firms. Modern financial analysis can provide insights to help managers deal with many of the problems they currently face. We use modern financial theory to show how the value of IT investments can be affected by some of the choices made by managers. We show how the market risk of demand and the market risk of costs affect the market risk and value of IT investments. We consider three types of investment decisions: outsourcing versus in-house services; investments in interorganizational systems; and determining the optimal level of IT services that should be provided. Our analysis indicates that: (1) as the market risk of demand for operations decreases, firms are less likely to outsource operations; (2) the value of an investment in an interorganizational system increases as the market risk of costs increases; and (3) the optimal level of user service is inversely related to service demand risk and is directly related to the market risk of service costs.     

Analysing four types of IT sourcing decisions in the context of scale, client/supplier interdependency and risk mitigation

The main thrust of the article is to distinguish between four types of IT sourcing decision: total outsourcing; multiple-supplier sourcing; joint venture/strategic alliance sourcing; and insourcing. To illustrate each type, detailed case histories are used that analyse the reasons why specific IT sourcing decisions were adopted. Here, we consider total outsourcing at the London Stock Exchange; multiple-supplier sourcing at ICI plc; joint venture project sourcing at CRESTCo Ltd; and insourcing at the Royal Bank of Scotland. The trend towards outsourcing is increasing in all industrial and commercial sectors. However, client organizations need to become more aware of some of the pitfalls, particularly in respect of large-scale outsourcing deals to single or multiple suppliers. This is because the move to IT outsourcing engenders the need to develop new capabilities and skills to manage complex commercial contracts. We therefore conclude that, while many IT outsourcing contracts followed rationalization, cost-cutting and disappointing results from in-house IT provision, short-termism and current uncertainties over market, business and political conditions pose problems for many organizations in deciding future outsourcing arrangements.     

Surveying the risks and benefits of IT outsourcing

In this article a survey of senior IT managers points to political and legal issues as the top risk concerns. These managers also say offshoring can create more jobs. Most companies consider offshore outsourcing as a way to reduce cost and increase efficiencies. Outsourcing can be a viable option for companies and can also help businesses and economies in the countries involved, as long as the outsourcing company objectively identifies and analyzes the benefits and risks.     

中国对日软件外包的现状分析及对策研究

经济的快速发展给企业的进步提出了很大的考验,企业在软件开发和营销方面采取软件外包的形式,集中精力在市场上增加自身的核心竞争力,并且达到可以降低成本的效果。对日软件外包行为也是发展我国软件产业的重要形式,既可以扩大我国软件销售的市场,又可以借鉴日本软件开发的技术,提高我国软件产业的综合水平。但在中国对日软件外包的过程中,也要结合我国软件市场的需求,抓住内需和出口导向的平衡发展,以提高我国软件服务为目标,将软件的研发放在重要位置,不断探索中国对日软件外包的对策。     

IT spending in the midst of the Asian economic downturn: a Singapore perspective

The Asian economic downturn has severely affected the revenue and profitability of companies operating in Asia. This has in turn caused a significant number of companies to reduce their spending on IT, particularly in the countries that have been most affected by the downturn. While IT spending is an immediate and visible effect of the downturn, less visible changes in managerial attitudes towards IT, and approaches to controlling IT spending are likely to have longer term implications to the IT capabilities of companies in the region. In this paper, we examine these issues in the Singapore context, paying particular attention to how companies plan to control and reduce IT infrastructure spending. We found that in the participating firms, managers appear to pay more attention to the links between business strategy and IT after the downturn. We also found that deferring investments in physical infrastructure and outsourcing were the main approaches to IT cost reduction.     

An evaluation of simulation to support contract costing

As global markets have become more customer oriented, rapid response rates are now often among the most important metrics in business. To achieve the required agility many companies have turned to outsourcing in order to focus on developing their core activities. By its nature, outsourcing increases the complexity of supply chain networks as more companies are drawn into global logistics networks. The relationships between each of these companies are controlled by contractual agreements. The fast pace of modern industry means that these contracts are entered into relatively quickly often without a full understanding of the true cost implications. This paper presents research conducted as part of a project with the aim of developing contract costing software for outsourcing enterprises. Findings are presented from a study conducted on a number of companies in the electronics sector. A simulation-based study focused on one of these companies, with some associated experimentation, is also presented.     

It and Business Process Outsourcing: The Knowledge Potential

Despite the widespread trends in IT and business process outsourcing, there has been too little focus on what happens to knowledge when an organization outsources. We present a framework for evaluating the knowledge potential within five different types of insourcing and outsourcing arrangements. A detailed example of an enterprise partnership relationship is described as a benchmark for how companies can leverage the knowledge potential from IT and BPO outsourcing.     

A framework for managing software make or buy

Whilst research highlights the strategic importance of make or buy policies for goods and services, studies reveal that managers often treat make or buy as an operational issue. In the case of software, although make or buy decisions are crucial in determining the outcome of IT applications, little research into software make or buy has been undertaken. A framework for managing software make or buy is proposed within which software make or buy policies are formulated, based on the strategic importance of applications, and the relative skills of internal and external software sources. The planning of internal software development resources results in firms developing specialised skills, in response to increasing specialisation in the software market.     

Effects of Project Owner’s Title on the Financial Impacts of IT Systems Integration Outsourcing Projects

Does the title type of IT project owners facilitate financial impacts on cost-efficiency, productivity, and profitability? We investigate these questions using a large dataset of 112 IT systems integration outsourcing projects of publicly traded companies during 1995–2010. While project owners with IT affiliations bring down operating and overhead expenses, projects managed by executives with non-IT titles improve firm profitability, and that the contribution of IT leadership on firm revenue is not significant.     

Social IT outsourcing and development: theorising the linkage

In recent years, a growing number of social enterprises have focused their attention on harnessing the benefits of trade in software by involving underprivileged communities from developing countries in the production of information technology (IT). The goal of this type of activity, known as social IT outsourcing, is not only to provide employment and income to low‐income individuals but also to address wider development priorities within the locality. This paper focuses on strengthening our understanding of social IT outsourcing as a promoter of development. Based on research in Jharkhand, eastern India, we seek to understand how social IT outsourcing activity is interpreted from the perspective of employees who provide data services for the market and from the perspective of the social enterprise that balances its market orientation with its social development goals. Our findings generate new insights into the mechanisms at play through which social IT outsourcing is able to provide a variety of developmental advantages to rural poor communities leading to policy implications for governments and development agencies.     

An assessment of the use of Transaction Cost Theory in information technology outsourcing

Transaction Cost Theory (TCT) has been widely used in information technology outsourcing (ITO) research to explain and predict outsourcing decisions and outsourcing-related outcomes. This research, however, has led to mixed and unexpected results in terms of the effects of transaction attributes on outsourcing decisions and outcomes. This study assesses the empirical literature employing TCT-based ITO models in terms of its faithfulness to the precepts of TCT, and argues that one possible explanation for the mixed results is that the extant models do not capture all the essential elements of TCT. First, there are core TCT constructs that the extant models do not take into account; second, the linkages among constructs that the IT outsourcing models have hypothesized are not always in line with TCT precepts; and third, the normative nature of the theory is not always captured by the extant models. This paper, therefore, aims to provide one possible answer to the question: “Why have the appropriations made of TCT to study IT outsourcing produced mixed results?”     

Exploring the supply-side of IT outsourcing: evaluating the emerging role of application service providers

The paper explores the supply-side of IT outsourcing by focusing upon the emerging role of application service providers (ASPs). It traces the transition from first wave IT outsourcing in the 1960s, to business-centric outsourcing in the 1980s and 90s to application outsourcing in the 21st century. Drawing from empirical research on a taxonomy of ASPs, the paper explores how application outsourcing is currently changing the nature of the outsourcing contract and relationship between client and supplier. This will have significant implications for traditional outsourcing and ERP vendors in the software and computing services industry, in addition to presenting new opportunities to SMEs with little history or experience of outsourcing.     

软件外包人才校企一体化培养模式

软件外包产业在全球迅猛发展,我国已经把发展软件外包产业提升为国家战略,因此对软件外包人才的需求越来越多。软件外包人才应具备更高的知识素养,现有的培养模式不能满足软件外包产业的要求,文章提出校企一体化培养模式,校企共同制定培养方案,引入学期项目及虚拟企业。