Outsourcing IT: The strategic implications

Abstract IT outsourcing is a growing phenomenon in the developed economies. However, it is not often managed as strategically as it might be. Drawing on evidence from 30 case histories in the United Kingdom, this article presents the basis for a strategic approach. It identifies six critical factors around which IT outsourcing decisions can be based, provides a framework for decision-making based on organizational experiences of different levels of success, and discusses the additional factors that need to be borne in mind as a reality check, to ensure that the IT outsourcing decision can be delivered upon. The paper argues for a more strategic approach to IT outsourcing and provides frameworks to enable decision-makers to think through the issues presented by an impending IT sourcing decision.