The Role of Vendor Legitimacy in IT Outsourcing Performance: Theory and Evidence

Information technology outsourcing (ITO) relationships today are facing increasingly turbulent environments. This research examines ITO performance by focusing on client firms’ perceived legitimacy of vendors, termed “vendor legitimacy,” consisting pragmatic, cognitive, and moral dimensions. Based our surveys with executives managers at 200 firms, the study’s findings present imperative to actively manage vendor for achieving sustaining performance. Specifically, strategic level, clients’ perception vendors as mutually aligned, long-term-oriented, tightly integrated partners is critical. At operational clients should collaborate design establish interorganizational routines that undergird legitimacy. managerial relational governance plays a pivotal role in attaining procedural justice, ethical standards, fairness collaboration. In sum, study suggests creating dedicated corporate function or unit continually overseeing assessing portfolio swiftly identifying responding potential issues crises related would be worthwhile investment.