Abstract
This study investigated practices that are followed when outsourcing Information Technology (IT) services in the North-West Provincial Government (NWPG) of South Africa. NWPG is a tier two level in the South African government structure and lies in between the national and the local governments. As a departure point, the research study identified the best practices in IT outsourcing, the most important benefits of this process as well as the shortcomings of IT outsourcing. The study is a culmination of requests from the provincial government stakeholders to have a framework of IT outsourcing best practices which is currently not available. The study used quantitative approach and a questionnaire as a research instrument. Findings revealed that the decision to outsource can sometimes be difficult to make and is risky. However, it also identified some benefits of IT outsourcing such as access to highly experienced IT specialists, access to advanced technologies, as well as improvement in customer service quality. Some risks associated with outsourcing such as hidden costs and loss of control on outsourced activities was also revealed. In addition, outsourcing may lead to increased unemployment and may negatively affect employees’ morale. It is recommended that NWPG should adopt an outsourcing plan that will guide its outsourcing process as well as establishing a clear understanding of its requirements, performing due diligence as well as carrying out of risk assessment during this process. Efficient and open communication channels between staff and management levels should also be developed. DOI: 10.5901/mjss.2014.v5n14p25
Highlights
The rapid changes in Information Technology (IT) industry have brought new and improved IT infrastructure to organizations, and the unenviable headaches of managing and maintaining these IT infrastructures
The risks related to IT outsourcing can range from failure to align outsourcing strategy with corporate objectives, servicelevel agreements not being implemented, operational, human resources (HR), and regulatory implications not being considered and failure to plan for contingency arrangements
With regard to these three areas, the study proposed that: Proposition A: Participants are knowledgeable of IT Outsourcing (ITO) purpose and its processes
Summary
The rapid changes in IT industry have brought new and improved IT infrastructure to organizations, and the unenviable headaches of managing and maintaining these IT infrastructures This problem becomes more difficult in public organizations such a Provincial governments where IT portfolios that comprise of IT staff, hardware, software, network infrastructure and the processes thereof attract very little budget. The strategic aim of outsourcing for government is to improve service delivery and reduce cost by making significant changes which are deemed not possible in the current public services environment It may be used as a solution to gain management expertise that is not available from within. Today’s telecommunications advances, the internet’s ubiquity and availability of global technology resources have made ITO a huge worldwide business.’ Putting this into context, this study investigated the NWPG’s outsourcing practices. The paper concludes with a reflection on practices in ITO
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