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Introduction
Traditionally, organizations have performed most of their activities using staff they have hired or by procuring services internally from other departments, and hence in-sourcing. According to Khalfan and Gough (2002, p. 305), in-sourcing involves the use of internal staff to perform certain activities within the organization. Hirschheim and Lacity (2006) view it as "the client's decision to perform and deliver services in-house after evaluating the outsourcing market".
Outsourcing is the use of outside contractors for important parts of a business's operations, which were either previously undertaken within or were brought in as new services. According to Bordeianu and Bénaud (1997), outsourcing is the transfer of an internal service or function to an outside vendor. It is a management approach which allows for delegating operational responsibility to an external agent and is practiced by organizations for wide-ranging reasons, such as to cut costs, bring in skilled and competent manpower and gain competitive edge over other organizations.
While businesses and organizations have in-sourced for thousands of years by hiring local employees to perform business activities, this trend changed in the 1970s and 1980s when, in an attempt to compete globally, they were handicapped by a lack of agility that resulted from bloated management structures (Handfield, 2006). To increase their flexibility and creativity, many large companies developed a new strategy of focusing on their core business, which required identifying critical processes and deciding on those that could be outsourced (Handfield, 2006). One such process is Information and Communications Technology (ICT), also often briefly referred to as Information Technology (IT).
IT outsourcing is a decision taken by an organization to contract out or sell some or all of the organization's IT assets, people and/or activities to a third-party vendor who in turn will provide and manage the services for a certain period of time and at a certain monetary fee (Lacity and Hirschheim, 1993). IT outsourcing has been used increasingly in the public sector as a policy instrument for changing the way publicly funded services are provided (Khalfan and Gough, 2002). According to Cordella (2012), ICT has become a major enabler of efficient exchange and retrieval of information in organizations. Its growth and complexity has created new challenges with respect to its management, control, design and use. Many...