Portal de Periódicos da CAPES

It Workers on Outsourcing: What about Me? What about the Profession?

2009; Allied Academies; Volume: 12; Linguagem: Inglês

1524-7252

Nita Brooks, Robert E. Miller, Melinda Korzaan,

Outsourcing and Supply Chain Management

ABSTRACT To date, have been numerous studies examining the impact of outsourcing on the IT function within and across organizations. Practitioners and researchers have focused tremendous efforts on understanding how to enter into and maintain relationships with outsourcing vendors. There have been, however, very few studies focusing on the impact outsourcing is having on the IT worker. In order to understand how outsourcing is impacting the IT workforce, this paper empirically examines the attitudes of IT workers toward IT outsourcing. Perceptions of how individuals perceive the impact of outsourcing on them personally and on the profession are explored along with whether these individuals perceive the impact as having already occurred or will occur. Findings from this study of over 450 IT workers from various organizations in the U.S. indicate that individuals do have different perceptions of how outsourcing impacts them versus how outsourcing impacts the IT profession. Analysis of how these perceptions impact outcomes shown to be important to IT workers was also conducted. Key outcomes including satisfaction and turnover intention were found to be significantly and negatively related to IT workers' perceptions of outsourcing's impact. Implications of these findings are provided along with direction for future research. INTRODUCTION IT outsourcing is not by any means a new phenomenon. Outsourcing of IT functions can be traced back to the early 1960's when EDS took over the data processing functions of two large companies: Frito-Lay and Blue Cross (Lacity & Hirchheim, 1993). Loh and Venkatramen (1992) coined the phrase Kodak effect to refer to the impact of Kodak's arrangement to turn over the majority of their IT operations to IBM, Businessland, and DEC on IT outsourcing in general. Since that time, IT outsourcing has grown and is considered a viable and strategic option for organizations. Organizations use different sourcing strategies ranging from total outsourcing to selective outsourcing. Firms continue to outsource increasingly large range of and depth of services (Barthelemy & Geyer, 2004, p. 91), this proliferation of IT outsourcing is not anticipated to slowdown in the near future (Computer Economics, 2006). A current trend is also emerging in which medium and small-sized companies are jumping on the IT outsourcing bandwagon. While large organizations have historically outsourced their IT functions, today small firms are progressively farming out IT operations to companies that provide a range of options for the smaller scale business. Overall, small and medium-sized businesses are forecast to make up two-thirds of the outsourced help-desk market in 201 1 (Tarn, 2007, p. B.5). Therefore, the effects of outsourcing are touching an increasingly wider range of companies and industries. Economic indicators and uncertainty have further perpetuated the outsourcing trend (Business Wire, 2008). Many companies have come to believe that outsourcing is good for the bottom-line. Chrysler, a company which has struggled for years, has taken this idea to heart by incorporating additional IT outsourcing as part of its plan for recovery (Overby, 2008). While many companies are outsourcing to domestic firms, a growing number have decided specifically to outsource offshore. Companies are driven to offshore outsourcing because they have become convinced it is necessary in order to be competitive in the global economy (HR Focus, 2008). The demand for offshore outsourcing is so great that IBM announced plans to invest $6 billion in India to expand its workforce there (Songini, 2007, p. 1). Given the significance of outsourcing, it is not surprising that the phenomenon has been widely investigated by IT researchers. Studies have examined why organizations outsource and the motivations behind outsourcing arrangements (Lacity & Hirschheim, 1995); the relationships between client firms and vendors (Kim & Chung, 2003); and how the technology acceptance model can be used to examine intentions to outsource (Benamati & Fajkumar, 2002). …