Risk-Driven Conceptual Modeling of Outsourcing Decisions

In the current networked world, outsourcing of information technology or even of entire business processes is often a prominent design alternative. In the general case, outsourcing is the distribution of economically viable activities over a collection of networked organizations. To evaluate outsourcing decision alternatives, we need to make a conceptual model of each of them. However, in an outsourcing situation, many actors are involved that are reluctant to spend too many resources on exploring alternatives that are not known to be cost-effective. Moreover, the particular risks involved in a specific outsourcing decision have to be identified as early as possible to focus the decision-making process. In this paper, we present a risk-driven approach to conceptual modeling of outsourcing decision alternatives, in which we model just enough of each alternative to be able to make the decision. We illustrate our approach with an example.