Outsourcing-VINE.doc

Theory applied to outsourcing uses the idea that it

Info icon This preview shows pages 5–7. Sign up to view the full content.

View Full Document Right Arrow Icon
theory applied to outsourcing uses the idea that it may make sense for one party to cheat on the other, but whether this is a successful strategy in the longterm depends on the reaction of the client. The evolution of co-operation (Axelrod, 1997) may depend on the results of several interactions (of the Prisoner’s Dilemma format) in which two players have an opportunity to co-operate or defect, with different payoffs. The game theory perspective is a reminder that it is not necessarily in your partner’s best interest to co- operate with you. The strategies of players (client and supplier) depend on their beliefs concerning the motives of the other, but the information game may be asymmetric in that one can cheat on the other. Outsourcing information systems in the public sector Case studies (Lacity & Willcocks, 1997)and analysis of outsourcing strategies (Cronk & Sharp, 1998) suggest that the following types of situation are common in the public sector environment: public sector IS managers are constrained by highly political influences and external stakeholders, as well as having to consider the internal constraints; senior government officials assume (often wrongly) that outsourcing to the private sector saves money; some public sector organisations can combine forces to act as a consortium purchasing client. In some circumstances, the low risk route to outsourcing success depends on outsourcing IS activities that are technically mature, stable, not highly integrated and for which the supplier can achieve economies of scale, and can offer superior technical expertise for support. The organisation should practise hands-on management of the contract, which should be of a duration which matches the known requirements. In some cases the client (or consortium client) may possess expertise that the supplier does not possess and this should be recognised. The type of interactions encountered in a relationship between client and supplier include (Kern & Willcocks, 2000) product/service exchange financial exchange service enforcement and monitoring communication/information exchange cultural adaptation investments in resources, knowledge and time sharing, and adaptation of vision
Image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
social and personal bonds. The research conducted by suggests that management efforts need to focus on the main game, the client’s objectives, as set out in the contract. In time, the relationship should evolve providing closer convergence and additional value in benefits to both, though at the danger of losing the focus on initial objectives. Research on outsourcing in the library, information and archives sector in the UK has investigated some of the activities of library purchasing consortia (Ball & Pye, 2000) and later studies (Ball et al., 2002) have developed a decision matrix to assess the feasibility of outsourcing.
Image of page 6
Image of page 7
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern