Investigating Trust in Outsourcing: A Study in the Healthcare Industry

Trust is important consideration prior to adoption of outsourcing options and subsequently during the management of the outsourcing relationship. Understanding the antecedents to the adoption of information technology is important to both technology firms that provide services and the policy analysts that study the effects of technology adoption and IT success. The first portion of this essay looks at the role trust plays in the outsourcing relationship. Trust is discussed as both an antecedent to adoption and a critical part of the relationship post adoption. The second portion of this essay looks at a conceptual model of trust and privacy that is tested using PLS. The empirical study uses a transactional cost approach to investigate the role of trust and privacy, both as direct effects and as moderators in the adoption of Application Service Providers (ASPs) as a new form of information technology outsourcing. The study focuses on the healthcare industry. Results from the model indicate that trust plays a minimal role in the adoption of ASPs. Limitations of the research are discussed; implications are reviewed and future research areas are identified.