Just Right Outsourcing: Understanding and Managing Risk

Abstract

The risks associated with outsourcing have been the principal limitation on the growth of business process outsourcing, especially cross border outsourcing. Technological improvements in risk management have lead to the dramatic increase in outsourcing in India. Further progress now comes from redesigning work flows and dividing work among multiple vendors, increasing the range of tasks that are now appropriate candidates for outsourcing.

Risks management of serial projects’ transformation into operational activities

“…восстановление проектов за счет стохастических рисков. Реализация удачных случайных рисков может в корне улучшить ситуацию с избавлением от неже лательной трансформации [6,12].…”

Using financial derivatives to hedge against market risks in IT outsourcing projects – a quantitative decision model

“…Growing significance and size of IT outsourcing projects lead to an increased concern with the issue of risk mitigation (Willcocks, Lacity, & Kern, 1999, p. 286). Thus, many articles focus on the assessment and controlling of IT outsourcing risk, for example Aron, Clemons, & Reddi (2005), Aubert, Dussault, Patry, & Rivard (1999), Aundhe & Mathew (2009), Fridgen & Müller (2011), Iacovou & Nakatsu (2008, and Taylor (2006). Very little research exists on dealing with IT outsourcing risks that are not dependent on project management quality but on the economic condition (market risks) of the involved project partners, although these market risks can have heavy negative financial impact, too.…”

The Impact of Business Process Outsourcing on Firm Performance and the Influence of Governance: A Long Term Study in the German Banking Industry

“…Business Process Outsourcing (BPO) has been said to have unique potentials (DiRomualdo et al, 1998;Gottfredson et al, 2005;Willcocks et al, 2004) that are accompanied by distinctive risks (Aron et al, 2005;Mani et al, 2006). When BPO benefits depend heavily on leveraging capabilities by aligning structures and resources between exchange parties, extremely close cooperation is necessary to attain them.…”

“…As BPO offers unique potentials that are accompanied by distinctive risks, organizations are unprepared for their governance (Aron et al, 2005;Mani, Barua, and Whinston, 2006). When BPO benefits depend heavily on leveraging capabilities by aligning structures and resources between exchange parties, intensive cooperation is necessary ensure that they are attained.…”

“…Triggered by these emerging new market structures Business Process Outsourcing (BPO) is gaining importance among new forms of business to business exchanges. Hence academic research has started to focus on BPO and postulates that BPO bears unique potential (DiRomualdo and Gurbaxani, 1998;Gottfredson, Puryear, and Phillips, 2005;Willcocks et al, 2004) that, however, is accompanied by severe risks (Aron, Clemons, and Reddi, 2005;. Willcocks et al (2004) stress the knowledge potential of BPO as the processes are often close to the outsourcer's core business.…”