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IT SOURCING - Coggle Diagram
IT SOURCING
DEFINITION
Doing IT work in your own firm or outside it
3 UNSTRATEGIC IT SOURCING DECISIONS
1) Business process outsourcing enabled by IT
Customer support, call centers, remote workers, crowdsourcing
consequences of IT use ~ operations sourcing is not IT
2) Commodity IT infrastructure and services
3) Commodity software
Negotiating price, service, and contracts is IT unit’s job
2 CHALLENGES IN OUTSOURCING IT
1) Integration problems - the pieces don’t fit
Must play well with your other IT assets
Often uses or sends data to them
Patchwork of inhouse systems, spanning generations
Actual costs can wipe out obvious savings
LOWERING INTEGRATION COSTS: 2X STRATEGIES
1) Concurrent sourcing
: Simultaneously insourcing and outsourcing the
same sort of IT work
2) Verify-then-trust approach
2) Receiving the wrong system
Outsourcing adds extra translator layer between users and vendor
Double whammy: Business-IT chasm + cultural barrier
Latent needs create volatile requirements
Might get what your IT unit asked for but not what you needed
AVOIDING THE WRONG SYSTEM: 2X STRATEGIES
1) Tapered outsourcing
2) Match Requirements Ambiguity with Contract Choice
5 CONSIDERATIONS OF WHERE TO OUTSOURCE
Time zone
Legal sophistication
Country profile
Cultural
Skill sets