Optimising vendor selection for information systems outsourcing under uncertainty

Abstract

Information systems outsourcing has become a popular strategy to acquire much needed organisational capability. Business value from outsourcing increasingly depends on how well the vendor selection process is managed. Effectively solving the vendor selection problem is therefore a significant outsourcing decision. This paper presents a multicriteria analysis method for optimising the vendor selection process in solving a specific information systems outsourcing problem. The multiplicity of the vendor selection process is effectively handled in the context of multicriteria analysis, and the uncertainty and imprecision of the human decision making process is adequately modelled with the use of linguist variables approximated by fuzzy numbers. An example that shows the practical use of the proposed method in real world settings is given. The example showcases how vendor selection problems in information systems outsourcing under uncertainty can be approached effectively.