Chapter 10: Technology Services Procurement Flashcards
What are the possible reasons to build
Costs
Expertise
Competitive advantage and intellectual property rights
Resource availability
No suitable package
What are the possible reasons to buy
Business strategy
costs
time
generic solution
What is OSS
Open Source Software is software that is distributed with its source code with a supporting licence which allows organisations to use the code in their own software.
Benefits of OSS
Organisations can enhance software themselves
supported by dedicated community
functionally risk
inexpensive (mostly free)
Drawbacks of OSS
Firms need to learn the source
large number of versions
no warranty of guarantee
What is production outsourcing
Concerned with the maintenance and support of software products that have already been developed
What is innovation outsourcing
Concerned with the development of new applications
Benefits of outsourcing
Enables higher quality of service
Cost reduction
business focus
Drawbacks of outsourcing
Information Security
Difficult to reverse
Can be politically controversial
Quality may be not what is expected
Inadequately documented systems and working practices
Current systems unsuitable for outsourcing
Benefits of Insourcing
Centralisation allows for economies of scale and centre of excellence
retention of institutional memory
goals and vision shared with the customer business units
Improved career paths
Disadvantages of insourcing
high employment costs
Danger that things wont change
budget approval difficult
What are the seven stages of vendor assessment
Form the project team
specify requirements
determine the evaluation criteria
identify companies and packages
send requirements to potential vendors
evaluate vendors
negotiate and place orders
What is an RFP
A Request For Proposal is a statement of intent to purchase, followed by a list of questions covering all of the issues that can be sent to potential vendors.
