Analysing alternatives for information technology outsourcing decision: an analytic network process approach

  • Authors:

  • Mohd Nishat Faisal;D. K. Banwet

  • Affiliations:

  • Department of Business Administration, Aligarh Muslim University, Aligarh, U.P., 202002, India.;Department of Management Studies, Indian Institute of Technology, Delhi Hauz Khas, New Delhi-110016, India

  • Venue:
  • International Journal of Business Information Systems
  • Year:
  • 2009

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Abstract

Information Technology (IT) outsourcing has become one of thestrategies adopted by businesses to manage the information needs ofthe organisation. The most important reason for IT outsourcing isthe organisations' focus on their core competence while otherreasons include controlling investments, attaining technologicalflexibility, reducing staffing problems, and coping with the fastpace of growth in information and communications technologies. ButIT outsourcing is a managerial decision that entails various risksand problems. Organisations opting for IT outsourcing are facedwith decisions regarding the choices available such as totaloutsourcing, multiple-supplier sourcing, joint venture/strategicalliance sourcing and insourcing. In this paper, the AnalyticNetwork Process (ANP), which utilises the concept of dependence andfeedback is proposed as a suitable technique for analysing IToutsourcing decision. This approach captures interdependenciesamong the decision attributes and allows a more systematicanalysis. It also allows inclusion of all the relevant criteria(tangible or intangible, objective or subjective, etc.) that havesome bearing in arriving at the best decision.