IT Project Outsourcing Risk Management Process Model from the Client and Vendor Perspective: The Case of Ethiopian Banking Sector
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Date
2017-06-03
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Addis Ababa University
Abstract
IT outsourcing is global business trend that involves client and vendor. Both client and vendor achieved their goal from successful completion of the outsourced project. However there are risks which affect the project success. Risk identified and managed from either side of client or vendor firms may not guarantee success in the project outcomes. This study aim to identify IT project outsourcing risks from both client and vendor perspective and propose risk management process model to handle those risk factors.
This study involved participants from both client and vendor organizations. Questionnaire and Interview were used to collect the required information which follows qualitative and quantitative data analysis with basis of literature. Some of the risk factors identified in this study were adopted from recent literatures. While other risk factors like employee turnover, fear of losing control, user and management expectation on project implementation and requirement change are risk factors identified by client and vendor participants in the current study.
The client and vendor had significantly different rating towards risks presented here. Lack of knowledge transfer, Lack of experience and expertise with project activities, Lack of team morale, and Lack of schedule and budget management scores the highest percentage rate by client respondents. Whereas the vendor respondent‟s highest rating resembles towards lack of schedule and budget management, Lack of top management support, client readiness, unclear requirements and failure to consider all costs. This study also intend to present risk management considering both client and vendor firms. Since client and vendor have different objective and interest within a project, the analysis result shows that the identified risk factors by both firms need mutual cooperation. Communication and partnership approach between two parties are essential factors to ensure the sustainability of IT project outsourcing.
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Keywords
IT Outsourcing Risk, IT Outsourcing Risk Management