Significance
Almost all enterprises do at least some outsourcing of information technology (IT) work. American research firm Gartner defines IT outsourcing as "the use of external service providers to effectively deliver IT-enabled business process, application service and infrastructure solutions for business outcomes." [i]
Outsourcing ranges from working with a single provider, to having an ecosystem of providers. It is not uncommon to find the number of providers to be in three digits. For example, a large bank in India has 300 different companies for its IT solutions and services providers, and an internal team of over 100 people to manage these providers.
The primary drivers for outsourcing include the following:
Access to specialized capabilities
Cost reduction
Augmenting IT capacity
Focusing on core competencies
Reducing risk
While these benefits are important for every company, collaborating with a technology partner has its own set of challenges, given that the partner is a different enterprise...
