Achieving Success in Information Systems Outsourcing

by Carol Saunders, Mary Gebelt, Qing Hu



The conventional wisdom is that companies should never outsource core functions. This study of thirty-four large companies, which outsourced for at least two years, demonstrates that outsourcing can be successful even when information systems are viewed as core functions. However, outsourcing negotiations must reflect the role of the company performing the outsourced functions and the nature of the outsourced work. A critical key to success in outsourcing arrangements lies in having tight contracts, even when the outsourcing vendor is viewed as a strategic partner or the IS function is considered to be core. This article offers prescriptions for writing contracts and creating balanced arrangements to enhance outsourcing success.

California Management Review

Berkeley-Haas's Premier Management Journal

Published at Berkeley Haas for more than sixty years, California Management Review seeks to share knowledge that challenges convention and shows a better way of doing business.

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