49 I N F O R M A T I O N S Y S T E M S M A N A G E M E N T W I N T E R 2 0 0 6 IT OUTSOURCING AND CORE IS CAPABILITIES: CHALLENGES AND LESSONS AT DUPONT Leslie P. Willcocks and David Feeny This article explores the following question: For firms that have outsourced major portions of their IT functions, what core IS capabilities do they need to retain and nurture, or create and develop, to ensure a strong IS capability over time? The challenges and lessons learned from implementing major IT outsourcing arrangements from 1997 to 2004 at Dupont are used to reexamine a previously published IS capabilities framework by the authors. HE RESOURCE-BASED PERSPECTIVE ON achieving competitive advantage now has a considerable pedigree, and several studies have applied this perspective to the contribution information technologies (IT) can make to achieving competitive advantage. Notable research has also been conducted in the area of establishing core capabilities within the IT organization (e.g., Ross et al., 1996; Bharadwaj et al., 1996). Feeny and Ross (2000) bring this work together by positing an evolu- tion of the CIO role depending on the maturity of the IT function and the business in their joint abilities to exploit IT. In allied studies over the past decade, re- searchers have pointed also to the importance of the ability to manage external IT supply, par- ticularly given the expanding and changing na- ture of the IT services market (Lacity and Willcocks, 2000, 2001). In particular, detailed case research into major IT outsourcing ar- rangements has found the relationship dimen- sion between the client and its suppliers to be a critical but complex set of issues to manage (Kern and Willcocks, 2001). The purpose of this study is to revisit the relevance and efficacy of, and challenges posed by, our own core IS capabilities framework published some seven years ago. Two research questions guided the present study: Does the model still hold or does it require re- vision? What challenges and learning arise from imple- menting the framework? REVISITING THE FEENY/WILLCOCKS (1998) FRAMEWORK We define a capability as a distinctive set of hu- man resource–based skills, orientations, atti- tudes, motivations, and behaviors that have the potential, in suitable contexts, to contribute to achieving specific activities and influencing business performance. A core IS capability is a capability needed to facilitate the exploitation of IT, measurable in terms of IT activities supported, and result- ing business performance. The nine IS core capabilities proposed in the original framework published in 1998 are shown in Figure 1. A brief sketch of the original framework is in order. It arose from field inter- view research into 53 high performers in the IT T LESLIE P. WILLCOCKS is a professor in the Information Systems Department at the London School of Economics, U.K., recently moving from Warwick University.
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