Important Factors in IT Outsourcing Relationship, a Model Development and Verification in Major National Companies

This paper explores which factors contribute to a strong, IT Outsourcing (ITO) relationship. Therefore, a conceptual model has been developed and tested in four Major National Companies (MNCs), who have outsourced their IT and additionally, their IT service providers have been studied. All the involved contracts have multibillion SEK (the Swedish currency krona) turnovers and belong to top 100 larges MNCs in Sweden. A case study research method has been used. The novelty in the model is to have contract management and expectation management as the most important factors that influence a good ITO relationship strongly supported by communication and conflict and conflict resolution. Trust, commitment, and cooperation received lower scores. We believe that this information could help IT decision makers to improve their relationship with the service buyer or a provider. This research supports the propositions that an effective relationship improves the contract management and strengthens the ITO success.