Strategic IT system development outsourcing risks from the client perspective

While successful strategic IT systems have great impact and can provide significant returns to an organization, it is not uncommon for such systems to fail to deliver the expected organizational returns. IT development project failure is a longstanding issue for all types of IT system developments. Organizations that engage in strategic IT system development take on great risk especially when the project involves significant outsourcing activities. While there has been a wealth of research into risk and risk management, research to date has not critically explored risk factors in the context of strategic IT system development outsourcing from the client perspective.The key objectives of this exploratory research are 1) to develop and test a risk framework for client risk factors in strategic IT system development outsourcing projects, and 2) to investigate ways in which clients of successful strategic IT system development outsourcing projects manage their critical risk factors. The research undertaken provides an in-depth exploration of client experiences of strategic IT system development outsourcing. The method chosen for this research is the multiple case study. The risk framework is tested, first, through nine published failed cases which provide some initial insight, and illustrate the utility and adequacy of the initial framework developed from the literature. Next, data collected from client organizations for three case study projects illustrates the research issues from the client perspective. The results 1) demonstrate the feasibility of the risk framework, 2) show which risks are most frequently encountered in such projects, and 3) illustrate the risk process and strategies used by client project managers to manage the risks identified and/or encountered in their strategic IT system development outsourcing projects. The diversity of IT development and outsourcing projects, and some unclear aspects of the risks in these areas in the existing literature continue to make this topic a pertinent and valuable research area. This study makes a significant contribution to the research field in addressing the on-going challenges of IT developments