Abstract

The decision process for companies to outsource information technology (IT) or not is a substantial business change and in many cases the competence to take such decisions is limited and has major consequences for the company future performance. Therefore in the paper we have proposed the development of a software application that can be used in the initial phase for deciding to outsource or not in contrast to the external help with consultants that might have their own interests. In fact the development of a software decision tool (SDT) that is business neutral it could be very usefully for the IT managers in support of the decisions regarding to outsource IT or not. By using this SDT the IT mangers could highlight also some potential risks that have might be hidden by their cost-savings efforts regarding IT outsourcing. On the other hand by using the SDT the IT managers can simulate different situations by changing the parameters and very important can document their decisions regarding outsourcing with more confidence. Additionally, this software tool it might require information that the own evaluation did not considered in the beginning and finally may add vital information to advice the IT managers in different situations. In the development of the SDT in taking the IT outsourcing decisions we have used the generic Transaction Cost Theory (TCE) for evaluation that is adapted to the IT risks according to Aubert et al. (2001) and which gives a qualitative measure of the outsourcing risks. In this context our paper has looked mainly to find answers to the following research questions: (1) is it possible to design such a tool and which decision parameters should be collected, how are those inter-related and how should such a decision tree be built up (2) is it possible to reduce all initially known uncertainties regarding outsourcing and highlight on potential risks? (3) How much trust we could have in such a software tool in order to be really used by the IT managers in decisions regarding IT outsourcing?

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