Understanding outsourcing partnership: a comparison of three theoretical perspectives

• Published in: IEEE transactions on engineering management Vol. 52; no. 1; pp. 43 - 58
• Main Authors: Lee, J.-N., Kim, Y.-G.
• Format: Journal Article
• Language: English
• Published: New York IEEE 01.02.2005; The Institute of Electrical and Electronics Engineers, Inc. (IEEE)
• Subjects: Behavioral attitudinal theory; causal model; Information services; Information systems; Intervening variables; Linkages; Mathematical models; Organizational behavior; Outsourcing; outsourcing partnership; outsourcing success; Partnerships; Psychological factors; structural equation model; Studies; Suppliers; theory of reasoned action; Korea
• ISSN: 0018-9391; 1558-0040
• DOI: 10.1109/TEM.2004.839958

In recent years, increasing attention has been paid to building a successful partnership between the customer and supplier of the information systems (IS) outsourcing services. The sources of influence in successful information services outsourcing partnerships were explored by means of a study of Korean firms involved in such activity. Six major partnership-related variables were identified, and three alternative models were formulated based on 1) a behavioral-attitudinal theory which considered mutual benefits, commitment, and predisposition as intervening variables between the action-based factors of shared knowledge, mutual dependency and organizational linkage, and outsourcing success; 2) a simple direct effects model without such intervening variables; and 3) a model is based on a theory of reasoned action where the roles of the need-based psychological factors and the action-based factors were reversed. The three models were compared using a survey of 225 organizations in Korea that have outsourced their IS functions to external service providers. The findings indicate that the first model built on the behavioral-attitudinal theory best explained outsourcing success.