Determinants of information technology outsourcing: a cross-sectional analysis
Journal of Management Information Systems
Information Systems Research
Assessing the Risk of IT Outsourcing
HICSS '98 Proceedings of the Thirty-First Annual Hawaii International Conference on System Sciences-Volume 6 - Volume 6
Analyzing IT Outsourcing Relationships as Alliances among Multiple Clients and Vendors
HICSS '99 Proceedings of the Thirty-second Annual Hawaii International Conference on System Sciences-Volume 7 - Volume 7
Predicting e-services adoption: a perceived risk facets perspective
International Journal of Human-Computer Studies - Special issue on HCI and MIS
An Empirical Assessment of Transaction Risks of IT Outsourcing Arrangements: An Event Study
HICSS '04 Proceedings of the Proceedings of the 37th Annual Hawaii International Conference on System Sciences (HICSS'04) - Track 8 - Volume 8
The Sourcing Of Application Software Services: Empirical Evidence Of Cultural, Industry And Functional Differences (Information Age Economy)
Information systems outsourcing: a survey and analysis of the literature
ACM SIGMIS Database
The effect of service quality and partnership on the outsourcing of information systems functions
Journal of Management Information Systems
International Journal of Electronic Commerce
Impact of Vendor Selection on Firms' IT Outsourcing: The Korea Experience
Journal of Global Information Management
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Outsourcing is a widely accepted option in strategic management, which, like every business venture, bears opportunities and risks. Supplementing the popular area of research on the merits of outsourcing, this paper examines how stockholders rate corporate sourcing decisions with regard to the risk they associate with this transaction. Using event study methodology and multivariate cross-sectional OLS-regression, we analyze a sample of 182 outsourcing transactions in the global financial services industry between 1998 and 2004 in order to investigate the risk-specific drivers of excess returns to shareholders. The analysis studies the impact of risk-specific independent variables, including transaction size, length, outsourced business functionality, and experience with outsourcing. Our findings indicate that risk-mitigating strategies have significant explanatory power, indicating that the capital market's reaction to an outsourcing announcement might at least partly be forecast. Results show a positive correlation between market reaction and business process outsourcing by financial services companies. We also find strong evidence indicating that capital markets react positively to relatively large transactions compared to the market capitalization of the outsourcing firm. For service providers our results show that traditional IT-related sourcing projects or the insourcing of administrative processes have a significant positive correlation with market reaction.