With the development of information technology, more and more enterprises begin to use IT for their production and management services. The establishment and maintenance of information systems has become an important part of corporate activity; however, the company 's resources are limited. The majority of enterprises, especially small and medium enterprises do not have the capability of independently develop and maintain their information systems at a high level (Ketler & Walstrom, 1993).
Outsourcing is when a company purchases a service from another company instead of performing it in-house. Information system outsourcing refers to the practice of shifting one or more IT-related activities to an outside firm (Schwarz, 2014). Nowadays, so …show more content…
Outsourcing makes it easier for companies to focus on their basic competences. Routine activities are very time consuming, and by outsource those activities allows companies to devote their time to strategic issues (Gonzalez, Gasco, & Llopis, 2010).
Companies outsource to prevent becoming technologically obsolete without making large investments in technology or spending heavily on fixed assets. Business organizations can increase their flexibility by continuously redesign their contracts. This allows them to meet their technology needs at any given time (Gonzalez, Gasco, & Llopis, …show more content…
In other words, what are the major factors that affect a company’s decision on whether or not to outsource their information system? This question is important because all companies must consider outsourcing in order to remain competitive. And as mentioned before, the success rate is low (Gonzalez, Gasco, & Llopis, 2015).. Some companies just follow trends. If they see companies that successfully outsourced, they will follow them because they think outsource will work on them as well; however, this is not always the case. The practice of IT outsourcing has been widely documented in the business journals, but there is not much attention provided to its determinants. We do not fully understand the set of factors leading to the outsourcing
Outsourcing is when a company purchases a service from another company instead of performing it in-house. Information system outsourcing refers to the practice of shifting one or more IT-related activities to an outside firm (Schwarz, 2014). Nowadays, so …show more content…
Outsourcing makes it easier for companies to focus on their basic competences. Routine activities are very time consuming, and by outsource those activities allows companies to devote their time to strategic issues (Gonzalez, Gasco, & Llopis, 2010).
Companies outsource to prevent becoming technologically obsolete without making large investments in technology or spending heavily on fixed assets. Business organizations can increase their flexibility by continuously redesign their contracts. This allows them to meet their technology needs at any given time (Gonzalez, Gasco, & Llopis, …show more content…
In other words, what are the major factors that affect a company’s decision on whether or not to outsource their information system? This question is important because all companies must consider outsourcing in order to remain competitive. And as mentioned before, the success rate is low (Gonzalez, Gasco, & Llopis, 2015).. Some companies just follow trends. If they see companies that successfully outsourced, they will follow them because they think outsource will work on them as well; however, this is not always the case. The practice of IT outsourcing has been widely documented in the business journals, but there is not much attention provided to its determinants. We do not fully understand the set of factors leading to the outsourcing