Preview

ICT Outsourcing Case Study

Powerful Essays
Open Document
Open Document
1008 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
ICT Outsourcing Case Study
In order to provide better quality service, some of the organizations prefer to turn over part of the system functions to external service providers. It is because the external service providers have skills and assets to fully utilize the system for performance management and attaining key business indicators. ICT outsourcing was one of it. Technology outsourcing growth has been rapid globally. According to Claver and Gonzales (2002), ICT outsourcing has become a trend to some companies. ICT outsourcing can be defined as make change the perspective of company to focus on more important and core business for better decision–making. The ICT outsourcing strategy is widely related with cutting costs, launching of new business ventures and improving efficiency.

Nowadays in Malaysia, ICT outsourcing practices are keep growing and has received as much as attention to many
…show more content…
As additional information to my academic writing, there are several differences between private and public sectors of ICT outsourcing. According to Lin, there are several differentiation including the decision making process of manner, personnel management, motivation, organization culture and management of information system (2008). In private sector, the motivation about the ICT outsourcing project is generated internally where the decision to outsourcing can be decide by them. It is also the awareness of the staff form the private sector to do better job. Different from public organization, the outsourcing project must be decided by higher level of management. In terms of gaining access to advanced technology and expertise through ICT outsourcing, the private sector sees it as a strategic move, but different for public sector organizations it is often the only option available, as employment regulations in the public sector would not allow hiring IT professionals at competitive salaries (Gantman,

You May Also Find These Documents Helpful

  • Better Essays

    There are several factors for a company to outsource their IT department like: cost, quality, global events, resource management, ability to hire/maintain employees, and agility, etc. A company can reduce the cost of their IT department by outsourcing different aspects of their IT needs. However when a company decides to outsource different aspects of their IT department they need to complete extensive research in order to make sure that they are going to receive quality work and that the outsourcing will save the company money. By outsourcing a company can offer their customers access to technical support for their product 24/7. Another…

    • 1088 Words
    • 5 Pages
    Better Essays
  • Better Essays

    CMGT578 Week2 Assignment

    • 822 Words
    • 3 Pages

    In this current IT technology driven age, companies whose primary core competency is not technology may have a difficult time operating and maintaining an IT environment that would give them a competitive advantage in the market place. A large company like Hess, whose mission statement is “…a global company devoted to exploring oil, gas and energy solutions”, would have a difficult time living it’s mission if it was too concerned with how to run their IT infrastructure and the impact it has on their marketing, sales, public relations, communications, and operations capabilities. However, each company must access their unique situation and environment to determine if IT outsourcing is the method going forward. There can be immense fiscal and operational benefits, but also significant risks.…

    • 822 Words
    • 3 Pages
    Better Essays
  • Better Essays

    Outsourcing has become an integral part of many organizations today. Outsourcing has its advantages and disadvantages that organizations will have to weigh to decide whether or not outsourcing is the best possible solution to their current problems and business operations. Outsourcing refers to the process of hiring external provider to operate on a business or organization function (Venture Outsource, 2012). In this case, two organizations or businesses enter a contract where there will be an exchange of services and payments. This paper will discuss the possible risks an organization may encounter in outsourcing in relation to the use of an external service provider for data storage, use of an enterprise service provider for processing information systems applications such as a payroll, human resources, or sales order taking, use of a vendor to support desktop computers, and use of a vendor to provide network support. This document will also discuss the risk mitigation strategies for each individual situation.…

    • 1256 Words
    • 6 Pages
    Better Essays
  • Powerful Essays

    Tegan Hrad Write Up

    • 3041 Words
    • 13 Pages

    Yet, when concerning one’s self or a company’s self with such an area as information technology, outsourcing must be looked at with meticulous contemplation in order to guarantee the best possible outcome. Experts, on both sides of the aisle, the customer / purchaser and the outsourced business, must exhibit exemplary communication between the two of them.…

    • 3041 Words
    • 13 Pages
    Powerful Essays
  • Powerful Essays

    Office Supply Incorporated (OSI) is a company in crisis, with challenges in its cost structure and poor IT performance. Outsourcing to Technology Infrastructure Solutions (TIS) is an opportunity to both reduce costs and complexity for the firm, but first must consider whether outsourcing is a good strategic fit for OSI. Outsourcing is known as the practice of turning over responsibility of some or all of organizations information systems to a foreign firm in order to stay competitive. Outsourcing is not new to the business world, as it dominated the manufacturing sector the past couple of decades. There are various advantages and disadvantages. Advantages include lower costs, better quality, and downsizing to focus on the core competencies, highly motivated workforce, and Information System performance problems. Disadvantages include loss of jobs and its effects, hidden costs that are often not calculated security and confidentiality issues, cultural barriers, and lack of control over the supplier. Companies need to effectively research for to be successful in an outsourcing relationship because outsourcing failures are very costly and are difficult to reverse. Outsourcing is a now a popular strategy for many organizations as the worldwide market for computing services are projected to grow yearly. In the future, new outsourcing destinations such as Eastern Europe are expected to pop up. It is essential to carefully weigh both the advantages and disadvantages before heading into an outsourcing relationship with another party.…

    • 1610 Words
    • 7 Pages
    Powerful Essays
  • Better Essays

    The pros and cons of outsourcing varies by industry, size of organization, organizational structure, and many other components. The pros and cons are highlighted and the fall of Satyam to encompass a full range of accounting aspects. All size organizations outsource a portion of his or her business. Therefore, taking time to reflect on the points identified in this paper may enlighten or create ideas for consideration regarding outsourcing.…

    • 2422 Words
    • 10 Pages
    Better Essays
  • Good Essays

    Lego Final

    • 1719 Words
    • 5 Pages

    Outsourcing is a good strategy for the following situations: Tasks that require specific manufacturing equipment and technical expertise can be outsourced to vendors who specialize in these fields to produce goods faster and of better quality. Outsourcing the supporting processes enables the firm to concentrate on its core business processes. Outsourcing also helps in risk sharing since the outsourced vendor is a specialist who can mitigate risks better. Outsourcing also helps a firm to decrease its operating risk by not completely relying on domestic suppliers; and reduces lead times in case of domestic supply shortage. Sometimes government in the foreign country provides incentives for foreign investment. Companies can sometimes access restricted market to sell their goods only if they purchase certain goods or services from the foreign country. Outsourcing helps a firm to increase its ability to operate 24 hours per day. A firm that sources from abroad may be able to exploit local competitive advantages such as cheap labor, skilled personnel, and technical experts. Outsourcing also enables firms to tap in to a knowledge base for better innovation. Outsourcing enables companies to generate better revenue recognition and provides them an added competitive differentiator.…

    • 1719 Words
    • 5 Pages
    Good Essays
  • Good Essays

    First advantage of outsourcing is that the organization is in the position to ensure that it is able to complete its activities in a swift and expert manner. Second advantage of outsourcing is that it helps organization to concentrate on core process instead of supporting processes carried out by it. Third advantage of outsourcing is that the organization will be in the position to ensure that it is engaged in activities of risk sharing over a period of time (Carroll, 2007). First disadvantage of outsourcing is that the organization will have risk of exposing confidential data. Second disadvantage of outsourcing is that it can cause some problem to organization in synchronizing the deliverables. Third disadvantage of outsourcing is that it is not able to have appropriate focus on its customers over a period of time.…

    • 611 Words
    • 2 Pages
    Good Essays
  • Better Essays

    Outsourcing is the contracting out of an internal business process to a third party organization. The term "outsourcing" became popular in the United States near the turn of the 21st century.(6) Outsourcing is big business today even for small businesses. Like every business decision we are faced with the advantages as well as the disadvantages of relocating part or all of a business. Outsourcing is one of the fastest growing trends in business as large-scale organizations have latched onto outsourcing due to the almost immediate savings and quality improvement. (1)…

    • 1004 Words
    • 5 Pages
    Better Essays
  • Good Essays

    Some managers may have to split their energies between activities that engage prospective customers and concerns with operations outside of the core business objectives (Leung, et al, 2013). Outsourcing alleviates this necessity, and the business managers can focus their energies where their competencies lie. Businesses that must rely on an outside service run the risk of downtime during critical system failures, leading to potential loss of productivity. It may take days before a busy IT contractor can devote attention on the business problem and resolve the issues. This may leave workers idle and cause hundreds to thousands of dollars in lost revenue. An in-house network administrator becomes intimately familiar with the eccentricities and unique characteristics of the network he manages (McWherter & Gowell, 2012). Because of this, he or she is able to deliver results more efficiently, quickly and personally. IT outsourcing can never provide a personal touch that comes close to that of an in-house IT specialist. Many companies reject the thought of giving this up, even though they can save money by…

    • 3443 Words
    • 14 Pages
    Good Essays
  • Powerful Essays

    Ibm on Demand Business

    • 3268 Words
    • 14 Pages

    Outsourcing is an abbreviation for outside-resource-using, what means in practice “using external resources”. This term is used to describe business concept which implies the transfer of part of their business to another company when it’s profitable. Initially, outsourcing was associated with a strategy for manufacturing companies that relocated their factories to countries where production costs were lower. Nowadays, outsourcing is associated not only with production, but with every areas of activity like HR, IT, financial services etc. The main difference between outsourcing of goods and services is that in case of services there are no transportation costs.…

    • 3268 Words
    • 14 Pages
    Powerful Essays
  • Good Essays

    Outsourcing is often undertaken to provide enterprises a competitive advantage by delegating business process to external agencies and realizing the benefits of low labor, better quality and improved innovation. While this provides a good picture of the fair side of the coin, most managers however need to grope with the possible shortcoming of the process and the corresponding impact on the company’s core processes. To best analyze the opportunities presented it is essential to reflect upon the advantages vis-à-vis the disadvantages of outsourcing. The pros of outsourcing…

    • 1194 Words
    • 35 Pages
    Good Essays
  • Good Essays

    Is Outsourcing Good

    • 693 Words
    • 3 Pages

    Outsourcing is an attractive mechanism that has been practice for long time and some companies have had positive results. However outsourcing is not a magical path that leads to a profitable and successful business all the time. There are a lot of risks inherent to this practice and any company willing to outsource should evaluate these risks responsibly.…

    • 693 Words
    • 3 Pages
    Good Essays
  • Good Essays

    1) Describe a business that you would like to start. Discuss how you would use global outsourcing to accomplish your goals.…

    • 1321 Words
    • 6 Pages
    Good Essays
  • Powerful Essays

    Rapidly changing market dynamics and global competitive pressures have caused organizations to spend more time focusing on their core business. Organizations are fast realizing that they can 't be all things to all people. So companies now, be it a software company, a service provider or a manufacturing firm, decide what they are good at and outsource everything else, i.e., focus on their core competency, and let someone else do the rest in a more efficient and cost-effective manner. The organization can focus on higher value-added activities while the outsourcing provider takes care of the day-to-day administration. Critical internal resources, such as technology and talent, can be devoted to company 's core business. Outsourcing reduces the need for large capital expenditures in noncore functions. Thus, outsourcing becomes a strategy for reducing the capital intensity of the business. This strategy has gained popularity as companies aim to become more nimble and gain the speed and flexibility necessary to compete in today 's business environment. A growing number of executives understand the benefits it can bring in terms of not only cost savings, but also heightened strategic focus. Many recognize outsourcing relationships as long-term partnerships created to further the strategic goals of the organization. As a result, human resources outsourcing is becoming increasingly prevalent. Outsourcing noncore activities…

    • 1768 Words
    • 51 Pages
    Powerful Essays