Managing Relationships across the Life Cycle of an Outsourcing Arrangement

As noted in the Introductory chapter, IT outsourcing research has evolved from a focus upon what firms outsource to successfully managing outsourcing relationships. In this chapter, we aim to contribute to practice by better understanding the underlying nature of the client-supplier relationship. In analyzing our rich research base comprising in-depth interviews with senior executives, CIOs, suppliers, IT staff, IT users, and IT outsourcing consultants, we found that the client-supplier dichotomy fails to capture the complexity of all stakeholder relationships involved in IT outsourcing. The “client” actually includes senior business managers who pay for IT, senior IT managers who manage IT, IT staff who deliver IT, and finally the users who actually receive the IT service. The “supplier” includes senior management who negotiate deals, account managers responsible for earning a profit on the deal, and supplier IT staff charged with delivery. If IT unions, external consultants, lawyers, subcontractors, or multi-sourcing are involved, additional sets of stakeholders are added to the party. By attending to these multiple stakeholders, we have a better understanding of the complex relationships among stakeholders, and operate from a more informed base for improving these relationships.