Is Outsourcing Decision: A Quantitative Approach

Abstract

In the modern hyper competition, the outsourcing decision can be a matter of survival or failure. In this paper,the authors aim at providing an easily adaptable, statistically robust decision model to help firms with decidingwhether or not to outsource their IS functions.Initially, the authors used Factor Analysis to identify the decision criteria. Then, they designed an AHP decisionmodel based on these criteria. The methodology is unique and this methodological combination has never beenused before. Results showed that geo-political issue is the most important criterion, followed by strategic,economic and technical considerations. Scholars can take advantage of this to shape their researches or test theresults in different contexts. Additionally, the model can be of great help to professionals considering ISoutsourcing.