ABSTRACT
This chapter aims to help management in deciding whether to outsource and in implementing an outsourcing program. The decision to outsource must be well thought out, and once the decision has been made, the entire process must be planned in detail. Outsourcing is an option for many different areas in information systems (IS). The data center and applications development are the two areas that appear to receiving the most consideration. Outsourcing the data center is a different proposition from outsourcing applications development. The chapter examines the benefits and a risk involved in turning over certain IS operations to an outside vendor. Under an outsourcing agreement, users define their needs and the vendor then becomes responsible for developing and maintaining the required systems. Corporate management can easily fall into a trap by not clearly defining its reason for outsourcing. The chapter also discusses how to interview and negotiate with outsourcing vendors and how to handle employees affected by outsourcing.
