Outsourcing is not a new phenomenon. This paper presents evidence for this contention and identifies a growing trend toward a mixed mode of operation, combining both outsourcing and insourcing, where IT services are being integrated into the parent company. This study concentrates on situations where a new enterprise has been formed from an existing data processing department, and where IS services have been moved to this new company, but some of them taken back into the parent company a few years later. First, reasons for the original outsourcing decisions are identified by semi-stnuctured interviews in six organizations. A model of the determinants of outsourcing has been developed on the basis of these interviews. A follow-up study was conducted six years later in two of the case organizations showing insourcing decisions, whose contingent factors are presented. The main conclusion is that external and internal solutions are both equally relevant alternatives for organizing IT/IS services. There is no general solution to the outsourcing decision itself, but the determinants of the decision process are now well known.
Reponen, Tapio, "OUTSOURCING OR INSOURCING?" (1993). ICIS 1993 Proceedings. 38.