Abstract
The IT and Business Process Outsourcing (BPO) market is large and diverse, covering everything from the outsourcing of quite simple processes or call centers to, more recently, the transformation of entire back office functions of major corporations. The supplier base is equally diverse, stretching from locally based specialists in particular applications and/or industry sectors, through offshore providers who base their appeal on their ability to provide what may be well-qualified staff at low unit labor costs, to “transformational” outsourcers who apply a combination of sophisticated management techniques and technology investment to achieve new levels of process performance. Client organizations are challenged to identify a provider whose capabilities are most appropriate for their needs.
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Notes
See for example Lacity, M., Willcocks, L., and Feeny, D. (1996), “The Value of Selective IT Sourcing,” Sloan Management Review, Vol. 37, 3, pp. 13–25 and
Feeny, D. and Willcocks, L. (1998), “Core IS Capabilities for Exploiting IT,” Sloan Management Review, Vol. 39, 3, pp. 9–21 (listed as an SMR Classic).
For definition and analysis of the “winner’s curse” phenomenon across 85 outsourcing contracts, see Kern, T. and Willcocks, L. and van Heck, E. (2002), “The Winner’s Curse in IT Outsourcing: Strategies for Avoiding Relational Trauma,” California Management Review, Vol. 44, 2, pp. 47–69.
For other research on motivating transitioned supplier employees, see Ho, V., Ang, S., and Straub, D. (2003), “When Subordinates Become IT Contractors: Persistent Managerial Expectations in IT Outsourcing,” MIS Quarterly, Vol. 14, 1, pp. 66–89.
Ang, S. and Slaughter, S. (2001), “Work Outcomes and Job Design for Contract Versus Permanent IS Professionals on Software Development Teams,” MIS Quarterly, Vol. 25, 3, pp. 321–351.
Exult quickly won significant add-on contracts, including a US$700 millions deal with Prudential Financial, and a US$600 millions deal with International Paper. From Cagle, M.L. and Campbell, K. (2002), “Taking HR from Cost Center to Revenue Generator at Bank of America,” presentation at the 2002 Outsourcing World Summit, Florida, February.
For discussion see Lacity, M., Feeny, D., and Willcocks, L. (2003), “Transforming a Back Office Function: Lessons from BAE Systems’ Experience of Enterprise Partnership,” MIS Quarterly Executive, Vol. 2, 2, pp. 86–103.
Lacity, M., and Willcocks, L. (2001), Global Information Technology Outsourcing: Search for Business Advantage, Wiley, Chichester.
Rottman, J. and Lacity, M. (2004), “Proven Practices for IT Offshore Outsourcing,” Cutter Consortium, Vol. 5, 12, pp. 1–27.
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© 2006 David Feeny, Mary Lacity, and Leslie Willcocks
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Feeny, D., Lacity, M., Willcocks, L. (2006). Assessing 12 supplier capabilities. In: Global Sourcing of Business and IT Services. Technology, Work and Globalization. Palgrave Macmillan, London. https://doi.org/10.1057/9780230288034_4
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DOI: https://doi.org/10.1057/9780230288034_4
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