Exploring relationships in information systems outsourcing: a typology of IS outsourcing relationships

Abstract

Information systems (IS) outsourcing continues to be an important issue on the agenda of corporate IT executives (Luftman et al. 2006). However, the IS outsourcing market is changing and diversified approaches to outsourcing practices have been emerging over the past three decades (Dibbern et al. 2004; Lee et al. 2003). Starting with long-term outsourcing projects in the 1980s, organizations today face a turbulent and dynamic business environment and thus tend to seek increasingly selective, short-term, and often multi-vendor outsourcing arrangements (Cohen and Young 2006). Outsourcing has evolved beyond providers merely taking over a function and performing higher quality work at lower cost. Outsourcing arrangements have become more sophisticated not only with regard to the service itself but also with regard to the seemingly boundless global delivery of IT components (Rottman and Lacity 2004). Besides forms of short-term selective outsourcing, strategic partnerships and alliances, often referred to as transformational outsourcing (Linder 2004), have become an emerging trend. In this context, risk-sharing models and collaborative service development of innovative IT services have begun to shape customers’ expectations toward the IT service provider (Leimeister et al. 2006b).