Riding for a Fall in Outsourced ISD: Knowledge Transfer Challenges Between the Onshore Vendor and the Offshored Unit

Contemporary information systems development (ISD) is often conducted in a multi-stakeholder network where parts of the development are offshored. This entails several risks and challenges as inter-organizational boundaries get blurred and relationships become complex. Knowledge transfer (KT) is especially difficult; however, it has not been thoroughly studied from the network’s perspective. This interpretive case study investigated why KT between onshore vendor and offshored unit is difficult in the ISD network. Numerous KT challenges were found and organized into four categories. In addition, some root causes were identified, including the nature of knowledge to be transferred, inappropriate systems development methods, the number of middlemen, and political issues. The study contributes to research by confirming insights from the literature on KT and also providing novel issues unique to a networked perspective. For practitioners, this study shows some potential issues to be considered when planning how to organize the outsourcing or offshoring of their systems development.