Information Technology Project Management
9th Edition
ISBN: 9781337101356
Author: Kathy Schwalbe
Publisher: Cengage Learning
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Textbook Question
Chapter 12, Problem 1DQ
List five reasons why organizations outsource. When should an organization choose not to outsource? Why are some organizations moving their software development work back in-house? Why are some organizations beginning to use onshoring?
Expert Solution
Explanation of Solution
Reasons to outsource:
- To reduce fixed costs and capital investment as approaching other companies to do work helps in reducing initial inflow requirement to the project.
- Improve accountability as a good contract helps reduce the risk of the company but reduce the daily requirements of supervision.
- Focussing on core competency of the business. It might not be the more added value of the company. For example, a company can outsource manufacturing process while focussing on the design part.
- Ensuring flexibility of operations to vary staff, production requirement easily as per demand.
- Accessing expertise in skill and technology. Approaching expert professionals and organizations will only help to improve efficiency and results.
Expert Solution
Explanation of Solution
Reasons for not to outsource:
- Companies might need more control over a project, this monitoring might not be applicable in outsourcing.
- Dependency over an external company can affect their performance. So, companies might avoid that.
- The information might be of strategic importance and provide a competitive advantage. This cannot be shared with other companies in the market.
Expert Solution
Explanation of Solution
Reasons for organizations to move back IT projects in-house:
- IT projects can be seen as services that be placed along with core activities.
- If the organization is ahead of competitors in the market, software development can be moved in-house.
Expert Solution
Explanation of Solution
Reasons to use on-shoring:
- It contributes to the development of economy and ensuring improvement in investments and job opportunities in the local level.
- It provides opportunity for better collaboration.
- Also reduces the cost of operation and ensure low-cost of resources.
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Information Technology Project Management
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9.1.2 Software Development Approaches; Author: EIToppo;https://www.youtube.com/watch?v=Z9znuSQ7Sz8;License: Standard YouTube License, CC-BY