Information System

MIT SCHOOL OF BUSINESS |

ASSIGNMENT ON BUSINESS INFORMATION SYSTEM |

OUTSOURCING |

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PART I

Outsourcing- What is Outsourcing

Outsourcing is contracting with another company or person to do a particular function. Almost every organization outsources in some way. Typically, the function being outsourced is considered non-core to the business. An insurance company, for example, might outsource its janitorial and landscaping operations to firms that specialize in those types of work since they are not related to insurance or strategic to the business. The outside firms that are providing the outsourcing services are third-party providers, or as they are more commonly called, service providers.

The process of outsourcing generally encompasses four stages:

1) Strategic thinking, to develop the organization's philosophy about the role of outsourcing in its activities;

2) Evaluation and selection, to decide on the appropriate outsourcing projects and potential locations for the work to be done and service providers to do it;

3) Contract development, to work out the legal, pricing and service level agreement (SLA) terms; and

4) Outsourcing management or governance, to refine the ongoing working relationship between the client and outsourcing service providers.

Outsourcing success depends on three factors: executive-level support in the client organization for the outsourcing mission; ample communication to affected employees; and the client's ability to manage its service providers. The outsourcing professionals in charge of the work on both the client and provider sides need a combination of skills in such areas as negotiation, communication, project management, the ability to understand the terms and conditions of the contracts and service level agreements (SLAs), and, above all, the willingness to be flexible as business needs change.

Wipro outsourcing:

Wipro Technologies, the global IT services business of Wipro Limited and Citibank...