The Importance of Managing Strategic IT Project Contracts Using a Business Process Approach

Abstract

Much has been written about managing information technology (IT) project contracts and their ultimate effect on fulfilling an organization's strategy. The integration of managing IT projects, contracts and firm strategy, however, continues to capture the attention of scholars and practitioners. This paper discusses the integration of these issues while providing a necessary process framework of how project contracts become strategic to firms when repeated transactions, increased risk identification, enhanced trust over time, and improved exploration and learning are present. IT project management has been and continues to be a growth profession, and the use of IT project contracts to outsource work has been increasing in importance as well. The authors have found that IT project management is collaborative when work is administered through information technology contracts that respond to organizational objectives. Because of the variance in how IT contracts are managed, they develop a strategic process model and discuss two lessons learned to better facilitate managing IT contracts. The proposed model and lessons learned provide insight so that the achievement of organizational strategy can be improved through simultaneous IT project and goal alignment.