Information systems outsourcing risks: a study of large firms

Abstract

Purpose – Despite the considerable growth of information systems (IS) outsourcing in recent years, this trend is still the object of strong criticism. This study has as its aim to show the main risks computer outsourcing entails in the case of the largest Spanish firms. Design/methodology/approach – In order to achieve that aim, reviews the previous literature on this topic and later analyses the results of a survey carried out using a questionnaire that was answered by 357 firms. Findings – According to the firms under analysis, the main concern in relation to IS outsourcing is the excessive dependence on the provider this type of contract can generate. Nevertheless, some characteristics of firms (mainly their size) determine to some extent what risks are seen as the most relevant. Originality/value – The conclusions suggest that total outsourcing can turn out to be a very dangerous strategy, mainly due to the dependence it creates. This is why IS managers should consider other alternatives such as having multiple providers or resorting to selective outsourcing.