ICT and the Implications of Outsourcing from a New Zealand Government Department and a New Zealand Vendor Organisation: Gauging the Differences between Expectations and Deliverables

Abstract

This paper analyses the issues present in ICT outsourcing, in particular for a New Zealand government department and a New Zealand vendor organisation and how expectations and benefits are managed. ICT outsourcing is analysed through its definitions, application, benefits, disadvantages, NZ context, vendor perspective, and a specific case study. The case study then presents implications and contributions for the field, industry and academics. It is suggested that ICT outsourcing contracts need to be more flexible to allow for constant review and modification in order to meet changing market expectations, and to result in increased benefit for all parties. Expectation and benefit management are also critical to a successful partnership. The following quotation from the ICT Manager at the Ministry for Culture and Heritage summarises his view of the relationship to date: I don't think what we have had delivered has met our expectations. There seems to have been a misunderstanding and now it is all a bit of a mess. The current service delivery manager at Datacom Systems (Wellington) Ltd offers the following in relation to the changes of personnel, the contract evolution and expectations: The Ministry did not have an understanding of the original requirements and we need to align with the new expectations. The following quotation summarises this paper: With outsourcing, there are more advantages than disadvantages.