Uday M. Apte

IS outsourcing practices in the USA, Japan and Finland: a comparative study

With increasing cost-reduction pressures, outsourcing of information systems (IS) functions has emerged as an important option for managers in companies around the world. In this paper we present the results of our exploratory, empirical research comparing practices of domestic and global IS outsourcing in the USA, Japan and Finland. The research methodology of a mail survey with similar questionnaires was used in all three countries. The paper provides new empirical evidence comparing these countries on the types of functions being commonly outsourced, the extent to which these functions are outsourced, views of Chief Information Officers (CIOs) on the desired cost savings and the comparative ratings of the advantages and disadvantages of IS outsourcing. Also compared are the roles played by different executives in making outsourcing decisions. The implications of these results for IS managers and directions for future research are presented in the conclusions.

Domestic and global outsourcing practices of America's most effective IS users

With increasing cost-reduction pressures, outsourcing - selectively turning over some information systems functions and processing services to a subcontractor - has emerged in the last few years as an important option for chief information officers (CIOs). In this paper we present the results of our exploratory, empirical research into the practices and views of IS outsourcing. The research methodology of a questionnaire-based mail survey was used. The survey sample consisted of companies that were identified as the most effective users of IS by Computerworld magazine. The paper provides empirical evidence on the extent to which outsourcing of various IS functions is being practised, and the views of CIOs concerning the advantages, disadvantages and motives of IS outsourcing. The paper also sheds light on the relationship between various firm characteristics and IS outsourcing, and investigates the economics of, and decision-making processes in, IS outsourcing. There is a special focus on the comparison of USA-based and global IS outsourcing.

Global outsourcing of information systems and processing services

Abstract Outsourcing, selectively turning over some junctions of information systems and processing services to a subcontractor, has recently captured the imagination of both information systems and corporate executives. With increasing cost‐reduction pressures, management sees outsourcing as an important option, which allows them to better leverage resources, contain costs, and focus on strategic and value‐added activities. Several countries have large pools of information systems professionals and clerical staff who are well‐trained and whose salary expectations are significantly less than those of their U.S. counterparts. The pricing advantage held by these countries and the advances in information technology have made global outsourcing a small but rapidly growing sector of the overall outsourcing market. Adopting the viewpoint of a business from a developed country such as the United States, the article analyzes the opportunities and challenges of global outsourcing, develops managerial guidelines fo...

Reusability-based strategy for development of information systems: implementation experience of a bank

This paper describes the experience of a large bank in designing and implementing an information systems strategy that is based on the concept of reusability. The design and implementation was performed in two stages: (1) building a prototype to investigate the feasability and attractiveness of reusability concept for the bank; and (2) its subsequent implementation using a library of reusable entities and a programmers workbench. The implementation experience confirmed that applying the reusability concept to all stages of the systems life cycle results in both strategic (e.g., improving programmer productivity and increasing the banks capacity for timely response to market opportunities) and operational (e.g., reducing and controlling system development and maintenance costs) benefits. It is estimated that the library of reusable entities embedded within the programmer workbench saved the bank over

Applying lean manufacturing principles to information intensive services

1.5 million in development costs in 1989 alone. Two of the most important lessons learned in implementing the reusability-based strategy are: (1) reusability comes in many flavors and should be applied to all stages of systems life cycle; and (2) major challenges in implementing the reusability-based strategy are managerial, not technical.

High Tech or High Touch?Efficient Channel Strategies for Delivering Financial Services

Lean manufacturing principles have been successfully applied to manufactured products for several decades to significantly reduce inventory in the supply chain and to increase productivity as well as the quality of the products. However, it is not clear whether such principles can be similarly applied to information intensive services that usually do not carry inventory. In this paper, we use an example of insurance claims handling process to illustrate how the lean manufacturing principles can be beneficially applied, albeit with some modifications, to information intensive services. Since such services do not have significant amount of inventory, we argue that minimising cycle time plays the same role as reducing inventory. We also show that a slightly different but parallel set of metrics should be used to evaluate the performance of the system after the implementation of lean principles to information intensive services.

Size, Structure and Growth of the U.S. Information Economy

Abstract With the progress of information technology, financial service institutions are restructuring their delivery channels. The delivery channel applications now range from direct sales and agency systems to all-electronic, customer-accessed networks. A key issue in the design of a delivery channel is achieving a proper mix of new technology and traditional human-centred delivery approach. Moreover, the delivery channel design should be properly matched with the characteristics of the service being offered. Based on a model of economic trade-offs, a theoretical framework, called the service channel strategies (SCS) approach, is proposed for identifying, analysing and designing appropriate delivery channel applications in the financial services industry. An example from banking is discussed to highlight the scope and normative focus of the proposed theoretical framework.

Information Services in the U.S. Economy: Value, Jobs and Management Implications

This paper presents the results of our empirical research in measuring the size and structure of the U.S. information economy in 1992 and 1997, and in assessing the growth experienced by different industries and sectors since Porat’s research on the U.S. information economy in 1967. The study indicates that the share of the information economy in total GNP grew from about 46 percent in 1967 to about 56 percent in 1992, and to 63 percent in 1997. The study further indicates that during this time period the share of service sector information activities in total GNP increased substantially, while the shares of non-service sectors declined correspondingly. The industries displaying the highest growth rates include business services, and medical and educational services. The paper also provides a critical assessment of Porat’s methodology and suggests specific improvements that may be made to obtain a more plausible measure of the size and structure of the information economy.

The Use of Latent Semantic Analysis in Operations Management Research

Most of the large economies in the world are dominated by services, in that services compose more than 50% of their GDP. Even in India, where most of the employment (60%) is in agriculture, services contributed just over 60% of the GDP in 2005. An exception is China, where the industrial sector is still larger than the service sector. However, this could be a matter of reporting conventions; for example, construction is not included in the service sector in the Chinese figures. For developed economies, the trend to services is very far along with many of them past the 70% mark, and every other economy out of the largest 25 is either past 50% mark, or has services as the largest sector. It seems that even when manufacturing or agriculture play large roles for a country, no economy of any size can really function without a large service sector.

Global Outsourcing of Information Processing Services

In this article, we introduce the use of Latent Semantic Analysis (LSA) as a technique for uncovering the intellectual structure of a discipline. LSA is an emerging quantitative method for content analysis that combines rigorous statistical techniques and scholarly judgment as it proceeds to extract and decipher key latent factors. We provide a stepwise explanation and illustration for implementing LSA. To demonstrate LSAs ability to uncover the intellectual structure of a discipline, we present a study of the field of Operations Management. We also discuss a number of potential applications of LSA to show how it can be used in empirical Operations Management research, specifically in areas that can benefit from analyzing large volumes of unstructured textual data.