The information system outsourcing has been received considerable attentions in recent years. Despite its great potential, the execution of the outsourcing need to be guided to avoid any possible problems.
This study shows how the difference in the r...
The information system outsourcing has been received considerable attentions in recent years. Despite its great potential, the execution of the outsourcing need to be guided to avoid any possible problems.
This study shows how the difference in the resources and capabilities between the customer company and the service provider affects the variables such as the type of outsourcing and partnership quality, finally the success of information system outsourcing.
Through the literature review, the research model which consists of the resources and capabilities of the customer company, the resources and capabilities of the service provider, the type of outsourcing, the partnership quality and the success of information system outsourcing is proposed. Based on the model, relevant hypotheses were developed and tested with the data collected by the questionnaire survey.
The hypotheses testing reveals the following results;
1. If the financial ability of the customer company is higher than that of the service provider, the partnership between the customer company and the service provider is good.
2. If the IT resource of the service provider is higher than that of the customer company, the partnership between the customer company and the service provider is good.
3. The difference in the IT ability has no effects on the partnership quality.
4. If the financial ability of the customer company is high, the support type of outsourcing is selected.
5. The support type of outsourcing results in improving the partnership quality by showing high degree of trust and cooperation.
6. The partnership quality has an effect on the success of outsourcing. Especially, the trust has an greater effect on the success of outsourcing than cooperation does.
From the literature review and statistical analysis, some guidelines for the success of information system outsourcing are suggested as follows;
1. The partnership quality is the critical factor for the success of information system outsourcing. Among many considerations, the IT resource of the service provider is the most important factor for the partnership quality.
2. Regarding the information system outsourcing type, the support type of outsourcing is preferred to the reliance type of outsourcing. Therefore, when placing an order of outsourcing, the customer company should carefully evaluate the characteristics of the service providers and give partial orders to several service providers based on the strength of the service provider.
3. Throughout the outsourcing process, the project must be controlled by the customer company.
4. To maintain the good partnership is important to cope with the possible dispute due to the discrepancy in the outsourcing contract.
5. Trust between the two companies should be increased to the degree that the confidential affairs in the customer company can be shared with the service provider.
In conclusion, among many resources and abilities, the financial ability of the customer company and the IT ability of the service provider are important factors for the good partnership and the success of the information system outsourcing. In addition, the support type of information system outsourcing is preferred to the reliance type of outsourcing for the success of outsourcing.