The success of global information technology outsourcing depends on several factors.
Response 1.) Michael
The success of global information technology outsourcing depends on several factors. An organization must first assess its internal financial resources and information systems (IS) breadth and depth of expertise and infrastructure. Diana (2009) evaluated the factors that influenced the decision of healthcare systems to retain IS functions in-house or outsource. One of the factors examined was the level of vertical integration within the healthcare system. Those systems with a higher level of vertical integration tended to internalize the IS mechanisms in the care delivery model. Also, organizations with highly customized IS systems are more likely to outsource IS services, presumably because IS vendors possess greater levels of skill diversity needed to manage complex IS systems.
Rai et al. (2009) found that relationship mechanisms and cultural considerations are critical to the success of global IS outsourcing. The relational mechanisms included client visits to the vendor site, client representation on the project team, and open architectures. Cultural considerations such as work practices, project leader values, and cultural differences between the client and the vendor have a significant impact on the success of IS outsourcing.
Diana, M. L. (2009). Exploring information systems outsourcing in U.S. hospital-based health care delivery systems. Health Care Management Science, 12, 434-450. https://doi.org/10.1007/s10729-009-9100-4
Rai, A. Maruping, L. M., & Venkatesh, V. (2009). Offshore information systems project success: The role of social embeddedness and cultural characteristics. MIS Quarterly, 33(3), 617-641
Response 2.) Jayne
According to the review of global information systems literature, From 1998-2020, various studies from different perspectives have been conducted on factors (determinants) that impact the success of global information technology outsourcing. This study uses the outsourcing contract to analyze and examine the success of different facets of outsourcing (Kotlarsky et al., July 1, 2018). Listed below are the factors that impact the success of global technology outsourcing:
- Achievement of Expected Cost Savings (Lacity and Willcocks 1998) –
- The Satisfaction with Outsourcing (Susarla et al. 2003)
- The Incurrence of Extra Costs (Dibbern et al. 2008)
- The Differences in the Performance of In-house versus Contracted IS Professionals Kotlarsky et al., July 1, 2018References:Dibbern, J., Winkler, J., & Heinzl, A. (2008). Explaining variations in client extra costs between software projects offshored to India. MIS quarterly, 333-366.Kotlarsky, J., Oshri, I., Dibbern, J., Mani, D., “IS Sourcing,” in MIS Quarterly Research Curations, Ashley Bush and Arun Rai, Eds., http://misq.org/research-curations, released: July 1, 2018; updated: August 25, 2020. DOI: 10.25300/07012018 https://www.misqresearchcurations.org/blog/2018/6/26/is-sourcingLacity, M. C., & Willcocks, L. P. (1998). An empirical investigation of information technology Susarla, Anjana. Understanding the organization of managed service providers: an analysis of customer satisfaction and contracting in markets for hosted IT services. The University of Texas at Austin, 2003.sourcing practices: Lessons from experience. MIS quarterly, 363-408.Susarla, A. (2003). Understanding the organization of managed service providers: an analysis of customer satisfaction and contracting in markets for hosted IT services. The University of Texas at Austin.
Response 3.) Eric
Yes, there is a risk that a company may lose its intellectual property rights when it outsources its information systems development. Intellectual property can include trade secrets, patents, trademarks, copyrights, and other proprietary information. Outsourcing to a third-party vendor can expose a company\’s intellectual property to unauthorized disclosure or theft, resulting in significant financial and reputational damage. To prevent the loss of intellectual property, companies can take several measures. Firstly, companies can carefully select outsourcing vendors and evaluate their reputation, experience, and security protocols before entering a contract. Companies should also ensure that the vendor has appropriate security measures in place to protect the company\’s intellectual property. Secondly, companies can include intellectual property protection clauses in their outsourcing contracts. These clauses can specify the types of intellectual property covered, the vendor\’s responsibilities to protect intellectual property, and the remedies available to the company in the event of a breach of the contract.
Chen and Hsu (2017) discuss the importance of protecting intellectual property in outsourcing. They argue that companies should take a proactive approach to protect their IP, which includes understanding the risks, evaluating vendor capabilities, and implementing appropriate measures to protect the IP. The authors suggest companies select vendors with solid IP protection policies and measures. Also, Chen (2022) discusses the challenges and solutions for protecting intellectual property. The authors argue that companies should implement a comprehensive IP protection strategy that includes legal protections, technology-based solutions, and management practices. They suggest that companies consider establishing an in-house IP management team to oversee outsourcing activities and ensure that the vendor complies with the company\’s IP policies.
References
Chen H. (2022). The impact of intellectual property protection on the development of digital economy and regional entrepreneurial activity: Evidence from small and medium enterprises. Frontiers in Psychology, 13, 951696. https://doi.org/10.3389/fpsyg.2022.951696
Chen, P. & Hsu, H. (2017). Intellectual property rights protection and R&D offshoring: evidence from Taiwan. Journal of the Asia Pacific Economy. 647–656.
Response 4.) Deborah
Intellectual property risks are the possible threats or vulnerabilities that a company or individual business needs to plan for when protecting their IP. Intellectual property can be protected by the law in the form of patents, copyright, and trademarks. Also Non-disclosure agreements can be signed by the company itself as well as by every employee working on the project. A non-disclosure agreement is a contract by which one or more parties agree not to disclose confidential information that they have shared with each other as a necessary part of doing business together.
Reference:
Earl, Michael J. (1996). The risks of Outsourcing IT
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