The Clash of Cultures in Information Technology Outsourcing Relationships: An Institutional Logics Perspective

Abstract

The outsourcing of information technology (IT) to external vendors promises lower delivery cost while attaining higher delivery quality. Despite these positive prospects, many IT outsourcing (ITO) projects still fail. On key aspect for non-working ITO engagements are cultural differences between organizations, teams, and individuals. This study explores the concept of culture in the context of ITO relationships by identifying and explaining particular cultural differences in such relationships. Building upon data from focus group discussions, we identify specific cultural differences in ITO relationships on the level of national culture (macro), organizational culture (meso) as well as team and individual culture (micro). Based on this, we apply the institutional logics perspective as a theoretical lens to derive institutional logics in ITO relationships, which explain and reason the identified cultural differences. With our results, we shed light on the under-researched concept of culture in ITO based on a multi-level analysis approach.