Title of article :
Organizational form, incentives and the management of information technology: Opening the black box of outsourcing
Author/Authors :
Eric A. Walden، نويسنده , , James J. Hoffman، نويسنده ,
Issue Information :
ماهنامه با شماره پیاپی سال 2007
Pages :
17
From page :
3575
To page :
3591
Abstract :
In this work, we attempt to show how operations researchers can effectively manage the production costs of computing services. The thesis of this paper is that an outsourcing firm, by virtue of the fact that it manages the IT function for multiple firms, is privileged to information not available to the focal firm. We derive the conditions under which this privileged information allows the partner firm to construct superior incentives for its employees, resulting in superior IT management. Further, we detail the circumstances under which outsourcing will not provide additional benefit, and what sorts of partners are likely to provide the greatest benefit. The two main findings are that for low levels of uncertainty, both in-house and relational management are equally acceptable. However, as uncertainty increases, the value of relational management increases. Conclusions are drawn and extensions are proposed, related to economies of scale and transactions costs.
Keywords :
Governance , Outsourcing
Journal title :
Computers and Operations Research
Serial Year :
2007
Journal title :
Computers and Operations Research
Record number :
928549
Link To Document :
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