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AIS Newsletter |
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IS SECTION / AMERICAN ACCOUNTING ASSOCIATION. |
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In the Literature : Research on Packaged Software Issues |
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EXPLAINING VARIATIONS IN CLIENT EXTRA COSTS BETWEEN SOFTWARE PROJECTS OFFSHORED TO INDIA Jens Dibbern, Jessica Winkler, Armin Heinzl. MIS Quarterly. Jun 2008. Vol. 32, Iss. 2; pg. 333
Abstract (Summary) Gaining economic benefits from substantially lower labor costs has been reported as a major reason for offshoring labor-intensive information systems services to low-wage countries. This study argues that offshore outsourcing involves a number of extra costs for the client organization that account for the economic failure of offshore projects. The focus is on software development and maintenance projects that are offshored to Indian vendors. A theoretical framework is developed a priori based on transaction cost economics and the knowledge-based view of the firm, complemented by factors that acknowledge the specific offshore context. The results of the analysis indicate that the client incurs post-contractual extra costs for four types of activities: 1. requirements specification and design, 2. knowledge transfer, 3. control, and 4. coordination. Slight evidence was found, however, that the cost-increasing impact of these factors was also leveraged in projects with a high level of required client-specific knowledge (moderator effect).
WORK DISPERSION, PROCESS-BASED LEARNING, AND OFFSHORE SOFTWARE DEVELOPMENT PERFORMANCE Narayan Ramasubbu, Sunil Mithas, M S Krishnan, Chris F Kemerer. MIS Quarterly. Jun 2008. Vol. 32, Iss. 2; pg. 437 Abstract (Summary) In this paper we develop a learning-mediated model of offshore software project productivity and quality to examine whether widely adopted structured software processes are effective in mitigating the negative effects of work dispersion in offshore software development. We explicate how the key process areas of the capability maturity model (CMM) can be utilized as a platform to launch learning routines in offshore software development and thereby explain why some offshore software development process improvement initiatives are more effective than others. We validate our learning-mediated model of offshore software project performance by utilizing data collected from 42 offshore software projects of a large firm that operates at the CMM level-5 process maturity. Our results indicate that investments in structured processes mitigate the negative effects of work dispersion in offshore software development. We also find that the effect of software process improvement initiatives is mediated through investments in process-based learning activities. These results imply that investments in structured processes and the corresponding process-based learning activities can be an economically viable way to counter the challenges of work dispersion and improve offshore project performance. We discuss the implication of these results for the adoption of normative process models by offshore software firms. [PUBLICATION ABSTRACT]
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