Transforming E-Government Services: The Use of Application Service Providers in U.S. Local Governments

This research project, based on a review of relevant literature and documents, assesses the potential of using Application Service Providers (ASPs) as a means to transform e-government services. This study identifies a list of drivers and barriers to outsourcing application services. The main drivers include top management commitment to the provision of high quality e-government services, potential cost savings, and utilization of technical expertise available in an ASP. The barriers are mostly related to outsourcing in general, such as the inability to control service quality, security, and potentially limited cost savings. Moreover, this study lists critical success and failure factors associated with the performance of an ASP. The success of an ASP lies in top management support, technical knowledge to monitor performance, and well-designed outsourcing contracts. Failures may stem from cumbersome and rigid rules governing local government outsourcing as well as from organizational resistance to change as the result of outsourcing to an ASP. This research serves as the first step to the full analysis of outsourcing application services by local governments.

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