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Collaboration in Outsourcing

Technology, Work and Globalization

The Technology, Work and Globalization series was developed to provide policy makers, workers, managers, academics and students with a deeper understanding of the complex interlinks and influences between technological developments, including information and communication technologies, work organizations and patterns of globalization. The mis-sion of the series is to disseminate rich knowledge based on deep research about relevant issues surrounding the globalization of work that is spawned by technology.

Also in the series:

Chrisanthi Avgerou, Giovan Francesco Lanzara and Leslie P. WillcocksBRICOLAGE, CARE AND INFORMATION

Francesco Contini and Giovan Francesco LanzaraICT AND INNOVATION IN THE PUBLIC SECTOR

Jannis KallinikosGOVERNING THROUGH TECHNOLOGYInformation Nets and Social Practice

Julia Kotlarsky, Ilan Oshri and Paul C. van FenemaKNOWLEDGE PROCESSES IN GLOBALLY DISTRIBUTED CONTEXTS

Mary C. Lacity and Joseph W. RottmanOFFSHORE OUTSOURCING OF IT WORK

Mary C. Lacity, Leslie P. Willcocks and Yingqin ZhengCHINA’S EMERGING OUTSOURCING CAPABILITIES

Shirin Madone-GOVERNANCE FOR DEVELOPMENTA Focus on Rural India

Ilan Oshri, Julia Kotlarsy and Leslie P. WillcocksOUTSOURCING GLOBAL SERVICES

Niki Panteli and Mike ChaissonEXPLORING VIRTUALITY WITHIN AND BEYOND ORGANIZATIONS

Carsten SørensenENTERPRISE MOBILITY

Edgar Whitley and Ian HoseinGLOBAL CHALLENGES FOR IDENTITY POLICIES

Leslie P. Willcocks and Mary C. LacityGLOBAL SOURCING OF BUSINESS AND IT SERVICES

Collaboration in OutsourcingA Journey to Quality

Edited by

Sjaak BrinkkemperProfessor of Organization and Information, Department of Information and Computing Sciences, Utrecht University

and

Slinger JansenAssistant Professor, Department of Information and Computing Sciences, Utrecht University

Selection and editorial matter © Sjaak Brinkkemper and Slinger Jansen 2012Individual chapters © individual contributors 2012

All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission.

No portion of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, Saffron House, 6–10 Kirby Street, London EC1N 8TS.

Any person who does any unauthorized act in relation to this publication may be liable to criminal prosecution and civil claims for damages.

The authors have asserted their rights to be identified as the authors of this work in accordance with the Copyright, Designs and Patents Act 1988.

First published 2012 byPALGRAVE MACMILLAN

Palgrave Macmillan in the UK is an imprint of Macmillan Publishers Limited,registered in England, company number 785998, of Houndmills, Basingstoke, Hampshire RG21 6XS.

Palgrave Macmillan in the US is a division of St Martin’s Press LLC, 175 Fifth Avenue, New York, NY 10010.

Palgrave Macmillan is the global academic imprint of the above companies and has companies and representatives throughout the world.

Palgrave® and Macmillan® are registered trademarks in the United States,the United Kingdom, Europe and other countries.

This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. Logging, pulping and manufacturing processes are expected to conform to the environmental regulations of the country of origin.

A catalogue record for this book is available from the British Library.

A catalog record for this book is available from the Library of Congress.

10 9 8 7 6 5 4 3 2 121 20 19 18 17 16 15 14 13 12

ISBN 978-1-349-34493-2 ISBN 978-0-230-36299-4 (eBook)DOI 10.1057/9780230362994

Softcover reprint of the hardcover 1st edition 2012 978-0-230-34770-0

v

Contents

List of Tables x

List of Figures xii

Acknowledgments xv

Series Preface xvi

List of Contributors xxi

Company Profiles xxvi

Introduction: Collaboration in Outsourcing 1Sjaak Brinkkemper and Slinger Jansen

Part I Governance

1 Governance Models in Offshore IT Outsourcing 5 Gábor Majdán 1.1 Introduction 5 1.2 Literature review 7 1.3 Related research 9 1.4 Outsourcing governance models from practice 12 1.5 Findings 17 1.6 Limitations and future research 22 1.7 Conclusion 22

2 Security: Case Studies in Three Dimensions 25 Elena Iancu 2.1 Introduction 25 2.2 Literature review 27 2.3 Case studies 31 2.4 Conclusions and further research 40

3 Mission-Critical Outsourcing 42 Suzanne Haanappel 3.1 Introduction 42 3.2 Evolution of IT outsourcing 43 3.3 Characteristics of outsourcing 44 3.4 Research method 48 3.5 Case studies 49 3.6 Comparison outsourcing and mission-critical outsourcing 55 3.7 Expert validation 55

vi Contents

3.8 Limitations/discussion 57 3.9 Conclusions and further research 57

4 Collaboration of Enterprise Architects in Outsourcing 59 Martin Janek 4.1 Introduction 59 4.2 Background and summary of existing research 60 4.3 Research method 64 4.4 Findings 65 4.5 Limitations and future research 68 4.6 Conclusion 70

5 A Decision Procedure for the Where and How to Outsource 73 Wouter Steenbeek, Lidwien van de Wijngaert, Mischa van den Brand, Sjaak Brinkkemper, and Frank Harmsen 5.1 Introduction 73 5.2 Sourcing decision-making 74 5.3 Research method 77 5.4 Results 80 5.5 Conclusion 84

6 Success and Failure in Offshore Development Projects 88 Matthias Fabriek, Mischa van den Brand, Sjaak Brinkkemper, Frank Harmsen, and Remko Helms 6.1 Introduction 88 6.2 Success in offshore CSD projects 90 6.3 Research method 92 6.4 Results and analysis 95 6.5 Discussion and conclusions 99

Part II Communication and Knowledge Management

7 Boosting Distributed Collaboration through Collaboration Tools Portfolio Optimization 105 Hristo Stefanov 7.1 Introduction 105 7.2 Related literature 107 7.3 Method development 112 7.4 Portfolio augmentation 120 7.5 Empirical evaluation 122 7.6 Conclusion 123

8 Retaining Project Knowledge in an Outsourcing Context 126 Antonios-Lavrentios Voutsinos 8.1 Introduction 126 8.2 Related literature 128 8.3 Survey illations 131 8.4 Knowledge asset prototype and knowledge retention framework 133

Contents vii

8.5 Empirical evaluation and validation 137 8.6 Limitations and future research 139 8.7 Conclusion 139

9 Initial Knowledge Sharing in Outsourcing 142 Aleksandar Chervenkov 9.1 Introduction 142 9.2 Literature review 144 9.3 Summary of empirical findings 148 9.4 A systematic approach to knowledge sharing in outsourcing 150 9.5 Empirical evaluation 156 9.6 Conclusion and further research 157 Appendix 158

10 Optimal Team Composition in Distributed Software Development 160 Roderick van Cann 10.1 Introduction 160 10.2 Related work 162 10.3 Team composition method descriptions 166 10.4 Method comparison 172 10.5 Outsourcing team composition method 174 10.6 Evaluation 177 10.7 Discussion 179 10.8 Conclusion 180

Part III Relationship Management and Quality

11 Dealing with Trust in Outsourcing Relationships 185 Martin Kirilov 11.1 Introduction 185 11.2 Related literature 188 11.3 Research method 193 11.4 Results and discussion 193 11.5 Conclusion and further research 195

12 IT Service Quality in Outsourcing Relationships 198 Jonathan Aarnouts 12.1 Introduction 198 12.2 Related literature 200 12.3 Service quality 201 12.4 The gap model 203 12.5 SERVQUAL 204 12.6 SERVPERF 206 12.7 SERVQUAL+ 206 12.8 Model construction 209 12.9 Case studies and discussion 213 12.10 Service quality through Giarte’s ITsat 215 12.11 Findings case studies 217

viii Contents

12.12 Validation by Accenture 218 12.13 Limitations 220 12.14 Conclusions and further research 220

13 Selection of Outsourcing Partners 224 Martijn Roeling 13.1 Introduction 224 13.2 Related literature 226 13.3 Approach 226 13.4 Method 1: partner selection for joint-venture agreement 227 13.5 Method 2: Outsource2India partner selection 231 13.6 Method 3: a third party’s view on partner

selection in outsourcing 233 13.7 Method comparison 235 13.8 A super method for partner selection in an outsourcing setting 239 13.9 A look at Indian strategy 240 13.10 Discussion 240 13.11 Empirical evidence 244 13.12 Conclusions 244 Appendix 245

14 Conflict Resolution in Outsourcing 248 Paul Noordveld 14.1 Introduction 248 14.2 Related literature 251 14.3 The conflict resolution in outsourcing (CRO) method 254 14.4 Evidence 261 14.5 Analysis 264 14.6 Discussion 265 14.7 Conclusion 266 Appendix I 267 Appendix II 271

15 Service Level Agreement in an Outsourcing World 274 Sander van Meggelen 15.1 Introduction 274 15.2 Literature study 275 15.3 SLAs in the outsourcing cycle 276 15.4 Structured approach for designing SLAs 277 15.5 Case study 278 15.6 Results 284 15.7 Conclusion 286 15.8 Future research and discussion 286 Appendix I: SLA 1 287 Appendix II: SLA 2 290 Appendix III: SLA 3 293

Contents ix

Part IV Software Development

16 Quality in Distributed Software Product Development 301 Tomas Salfischberger 16.1 Introduction 301 16.2 Related literature 302 16.3 Definition of quality 303 16.4 Quality approaches 304 16.5 Case studies 307 16.6 Discussion 312 16.7 Conclusion 314 16.8 Future research 314

17 Distributed Scrum Process Guide 316 Koen Bos 17.1 Introduction 316 17.2 Related literature 317 17.3 Scrum 318 17.4 Concepts 321 17.5 Discussion 325 17.6 Conclusion 325 17.7 Further research 326

18 Project Coordination in Distributed Software Development 328 Koen Huijsman 18.1 Introduction 328 18.2 Related literature 330 18.3 Scope 333 18.4 Case studies 334 18.5 Results 337 18.6 Discussion 338 18.7 Conclusion 339 Appendix I: activity table 339 Appendix II: concept table 340

19 Distributed Requirements Management in an Offshoring Context 343

Suzanne Gietema 19.1 Introduction 343 19.2 Related literature 344 19.3 Case study 346 19.4 Analysis of results 355 19.5 Discussion 356 19.6 Conclusion 356

Index 359

x

Tables

3.1 Characteristics of the categories by Embleton and Wright (1998) 47 3.2 Characteristics of the categories by Zhu et al. (2001) 47 3.3 Characteristics of the categories by Franceschini et al. (2003) 48 3.4 Eternity SLA layers 53 3.5 Comparison of the two case studies 54 3.6 Similarities and differences of outsourcing and mission

critical outsourcing 56 4.1 Collaboration challenges and best practices 69 4.2 Collaboration challenges and best practices 71 5.1 Sourcing options based on sourcing locations and sourcing relationships 76 5.2 Factor loadings for the rotated five-factor solution 81 5.3 Relation between twenty sourcing options and the five factor solution 81 5.4 Fixed effects (with robust standard errors) from multilevel

regression models for each of the five factors 84 6.1 Success scores of the projects that were researched 95 6.2 An overview of the reasons of success or failure mentioned

by the most successful and unsuccessful projects 98 7.1 A list of all activities involved in the method 115 7.2 A list of artifacts (concepts) resulting from the method 116 8.1 Knowledge retention terms summary 129 8.2 Case-study questionnaire 131 8.3 The knowledge equation 133 8.4 Reusable knowledge asset prototype 134 8.5 Interviewee quotes and what they trigger 138 A.1 Activities in the process deliverable diagram 158 A.2 Concepts in the process deliverable diagram 15810.1 Method comparison matrix 17311.1 Benefits and challenges in offshore outsourcing 18612.1 SERVQUAL questionnaire statements and their

corresponding service quality dimensions 21012.2 SERVQUAL questionnaire statements and their

corresponding relationship quality dimensions 21113.1a Activities of the JVPSM 22913.1b Concepts of the JVPSM 23113.2a Activity table of the Outsource2India partner selection method 23413.2b Concept table of the Outsource2India partner selection method 23513.3a Activity table of the third party’s partner selection method 23713.3b Concept table of the third party’s partner selection method 239

List of Tables xi

13.4 List of influenceable factors by Indian companies 242 A.1 Activity comparison table 245 A.2 Concept comparison table 24614.1 Categories of conflict resolution method 25014.2 Causes of conflicts between companies 25414.3 Results related to the specific steps in the method 26314.4 Results related to the method as a whole 264 A.1 Activity table of the conflict resolution in outsourcing method 267 A.2 Concept table of the conflict resolution in outsourcing method 27115.1 SLA design approach 27915.2 SLA comparative approach 282 A.1 SLA comparative approach 287 A.2 SLA comparative approach 290 A.3 SLA comparative approach 29316.1 ISO 9126 quality attributes 30416.2 Quality methods overview for case 1 30816.3 Quality methods overview for case 2 (Part 1:

Functionality and Usability) 31116.4 Quality methods overview for case 2 (Part 2: Maintainability) 31217.1 Overview best practices in distributed scrum 31818.1 Example DSM 33218.2 DSM after splitting 33218.3 Example of adjacency matrix 332 A.1 Activity table 340 A.2 Concept table 34119.1 Requirements management methods overview used by

onsite location 34819.2 Requirements management methods overview used by

offshore location 35219.3 Requirements management methods overview used by

onsite location when nearshoring 354

xii

Figures

1.1 Meta governance model 111.2 Offshore Development Centre@Work model 131.3 coMethodTM joint development process’ roles, deliverables, and joint

organizational meetings 141.4 Logica Sourcing Governance – service provider side, defining

the processes and process groups 151.5 Logica Sourcing Governance model – Engagement perspective 161.6 Operational level joint process fields from both scientific literature

and the practical field 212.1 Risk Matrix 1 312.2 Security risk management framework 322.3 Conceptual model outsourcing security 332.4 Roles and best practices in outsourcing security

risk management 393.1 Strategic intents for IT Outsourcing 455.1 Conceptual model 775.2 Average factor scores for the two conditions of the variables

for each factor 835.3 A comprehensive presentation of Multilevel Regression

Analysis 856.1 The amount of success on each aspect of success 966.2 Some project characteristics compared to the overall

success of projects 966.3 The coordination measures that were mentioned 977.1 Collaboration tools (CT) service types classified according

to time and space considerations 1087.2 Conceptual model of a dashboard APM method 1107.3 A matrix based APM method 1117.4 Process deliverable diagram 1147.5 Sample TOOL EVALUATION MATRIX 1188.1 Knowledge retention framework 1369.1 Centralized approach to knowledge repositories 1459.2 Peer-to-peer approach to knowledge repositories 1469.3 Hybrid approach to knowledge repositories 1479.4 Project-critical knowledge package 1519.5 Process deliverable diagram of knowledge

sharing in outsourcing 1539.6 Project-critical knowledge package integration in a

hybrid knowledge repository 155

List of Figures xiii

10.1 Ahn et al. method 16710.2 Wi et al. method 16810.3 Tseng et al. method 16910.4 Venkatamuni and Rao method 17010.5 Zakarian and Kusiak method 17110.6 Outsourcing team composition method 17510.7 CoMakeIT Engagement Model 17911.1 IT Outsourcing relationship model 18611.2 Relationship behavior between the extent of outsourcing

and the degree of mutual dependency 19011.3 Evolution of trust 19211.4 Trust building factors 19411.5 Trust sustaining factors 19512.1 Product-service mixtures 20112.2 Factors influencing the expected service 20212.3 Factors influencing the received service 20212.4 Perceived service quality 20212.5 The Gap Model 20312.6 Service quality dimensions 20512.7 SERVQUAL versus SERVPERF 20612.8 SERVQUAL+ zone of tolerance 20712.9 SERVQUAL+ MSS and MSA 20912.10 SERVQUAL questionnaire for IT service quality in outsourcing 21212.11 Project types Logica Nederland 21312.12 Ranking of quality dimensions 21412.13 Overview of Infosys external quality measurements

on annual and periodic basis 21612.14 Monthly trends in service quality scores 21713.1 PDD of the JVPSM 22813.2 PDD of the Outsource2India company 23213.3 PDD of the third party’s partner selection method 23613.4 Super partner selection method 24114.1 Overview of the conflict resolution in outsourcing (CRO) method 25714.2 Detailed view of stage 2 of the CRO method 25814.3 Detailed view of stage 3 of the CRO method 25814.4 Detailed view of stage 4 of the CRO method 25814.5 Detailed view of stage 5 of the CRO method 25914.6 Detailed view of the 5-stage CRO method 26015.1 Comparative approach scores of the SLAs, divided into

the main SLA characteristics 28515.2 Comparative approach scores of the SLAs, divided into

the SLA characteristic parts 28517.1 Scrum cycle 32017.2 Microsoft development cycle 323

xiv List of Figures

17.3 Model for Distributed Scrum Process Guide 32618.1 Social network analysis, graphical representation 33318.2 Concepts of factors that seem to influence each other 33318.3 PDD of method 33619.1 Requirements management process at Company A 34719.2 Requirements management process at Company H 35119.3 Requirements management process at Company J 354

xv

Acknowledgments

The trip and the book were made possible by several donations. These donations were supplied by Celerity, Deloitte, Levi9, Patni, Utrecht University and Utrecht University Foundation, in alphabetical order.

xvi

Series Preface

We launched this series in 2006 to provide policymakers, workers, managers, academics and students with a deeper understanding of the complex interlinks and influences among technological developments, including in information and communication technologies (ICT), work, organizations and globalization. We have always felt that technology is all too often positioned as the welcome driver of globalization. The popular press neatly packages technology’s influence on globalization with snappy sound bites, such as “Any work that can be digi-tized will be globally sourced.” Cover stories report Indians doing US tax returns, Moroccans developing software for the French, Filipinos answering UK customer service calls, and the Chinese doing everything for everybody. Most glossy cover stories assume that all globalization is progressive, seamless, intractable, and leads to unmitigated good. But what we are experiencing in the twenty-first century in terms of the interrelationships between technology, work and globalization is both profound and highly complex.

The mission of this series is to disseminate rich knowledge based on deep research about relevant issues surrounding the globalization of work that is spawned by technology. To us, substantial research on globalization considers multiple perspectives and levels of analyses. We seek to publish research based on in-depth study of developments in technology, work and globalization and their impacts on and relationships with individuals, organizations, industries, and countries. We welcome perspectives from business, economics, sociology, public policy, cultural studies, law and other disciplines that contemplate both larger trends and micro-developments from Asian, African, Australian and Latin American, as well as North American and European, viewpoints.

As of this writing, we have 14 books published or under contract. These books are introduced below.

1. Global Sourcing of Business and IT Services by Leslie P. Willcocks and Mary C. Lacity is the first book in the series. The book is based on over 1000 interviews with clients, suppliers, and advisers and 15 years of study. The specific focus is on developments in outsourcing, offshoring, and mixed sourcing practices from client and supplier perspectives in a globalizing world. We found many organi-zations struggling. We also found some organizations adeptly creating global sourcing networks that are agile, effective, and cost-efficient. But they did so only after a tremendous amount of trial and error and close attention to details. All our participant organizations acted in a context of fast-moving technol-ogy, rapid development of supply-side offerings, and ever-changing economic conditions.

2. Knowledge Processes in Globally Distributed Contexts by Julia Kotlarsky, Ilan Oshri and Paul van Fenema examines the management of knowledge processes of

Series Preface xvii

global knowledge workers. Based on substantial case studies and interviews, the authors – along with their network of co-authors – provide frameworks, practices and tools that consider how to develop, coordinate and manage knowledge proc-esses in order to create synergetic value in globally distributed contexts. Chapters address knowledge sharing, social ties, transactive memory, imperative learning, work division and many other social and organizational practices to ensure suc-cessful collaboration in globally distributed teams.

3. Offshore Outsourcing of IT Work by Mary C. Lacity and Joseph W. Rottman explores the practices for successfully outsourcing IT work from Western clients to offshore suppliers. Based on over 200 interviews with 26 Western clients and their offshore suppliers in India, China, and Canada, the book details client-side roles of chief information officers, program management officers, and pro-ject managers and identifies project characteristics that differentiated successful from unsuccessful projects. The authors examine ten engagement models for moving IT work offshore and describe proven practices to ensure that offshore outsourcing is successful for both client and supplier organizations.

4. Exploring Virtuality Within and Beyond Organizations by Niki Panteli and Mike Chiasson argues that there has been a limited conceptualization of virtuality and its implications on the management of organizations. Based on illustrative cases, empirical studies, and theorizing on virtuality, this book goes beyond the simple comparison between the virtual and the traditional to explore the differ-ent types, dimensions and perspectives of virtuality. Almost all organizations are virtual, but they differ theoretically and substantively in their virtuality. By exploring and understanding these differences, researchers and practition-ers gain a deeper understanding of the past, present and future possibilities of virtuality. The collection is designed to be indicative of current thinking and approaches, and provides a rich basis for further research and reflection in this important area of management and information systems research and practice.

5. ICT and Innovation in the Public Sector by Francesco Contini and Giovan Francesco Lanzara examines the theoretical and practical issues of implement-ing innovative ICT solutions in the public sector. The book is based on a major research project sponsored and funded by the Italian government (Ministry of University and Research) and coordinated by Italy’s National Research Council and the University of Bologna during the years 2002–2006. The authors, along with a number of co-authors, explore the complex interplay between technology and institutions, drawing on multiple theoretical traditions such as institutional analysis, actor network theory, social systems theory, organization theory, and transaction costs economics. Detailed case studies offer realistic and rich lessons. These case studies include e-justice in Italy and Finland, e-bureaucracy in Austria, and Money Claim On-Line in England and Wales.

6. Outsourcing Global Services: Knowledge, Innovation, and Social Capital, edited by Ilan Oshri, Julia Kotlarsky and Leslie P. Willcocks, assembles the best work from the active participants in the Information Systems Workshop on Global Sourcing

xviii Series Preface

which began in 2007 in Val d’Isere, France. Because the quality of the contribu-tions was exceptional, we invited the program chairs to edit a book based on the best papers at the conference. The collection provides in-depth insights into the practices that lead to success in outsourcing global services. Written by inter-nationally acclaimed academics, it covers best practices on IT outsourcing, busi-ness process outsourcing, and netsourcing.

7. Global Challenges for Identity Policies by Edgar Whitley and Ian Hosein pro-vides a perfect fit for the series in that the authors examine identity policies for modern societies in terms of the political, technical, and managerial issues needed to prevent identity fraud and theft. The scale of the problem exceeds pol-itical boundaries and the authors cover national identity policies in Europe and the rest of the world. Much of the book provides in-depth discussion and analysis of the UK’s National Identity Scheme. The authors provide recommendations for identity and technical policies.

8. E-Governance for Development by Shirin Madon examines the rapid prolif-eration of e-governance projects aimed at introducing ICT to improve systems of governance and thereby to promote development. In this book, the author unpacks the theoretical concepts of development and governance in order to propose an alternative conceptual framework, which encourages a deeper under-standing of macro- and micro-level political, social, and administrative processes within which e-governance projects are implemented. The book draws on more than 15 years of research in India during which time many changes have occurred in terms of the country’s development ideology, governance reform strategy, and ICT deployment.

9. Bricolage, Care and Information Systems, edited by Chrisanthi Avgerou, Giovan Francesco Lanzara and Leslie P. Willcocks, celebrates Claudio Ciborra’s Legacy in Information Systems Research. Claudio Ciborra was one of the most innovative thinkers in the field of information systems. He was one of the first scholars who introduced institutional economics in the study of IS; he elabo-rated new concepts, such as “the platform organization,” “formative contexts”; and he contributed to the development of a new perspective altogether through Heideggerian phenomenology. This book contains the most seminal work of Claudio Ciborra and the work of other authors who were inspired by his work and built upon it.

10. China’s Emerging Outsourcing Capabilities, edited by Mary C. Lacity, Leslie P. Willcocks and Yingqin Zheng, marks the tenth book in the series. The Chinese government has assigned a high priority to science and technology as its future growth sectors. China has a national plan to expand the information technol-ogy outsourcing (ITO) and business process outsourcing (BPO) sectors. Beyond the hopes of its leaders, is China ready to compete in the global ITO and BPO markets? Western companies are increasingly interested in extending their glo-bal network of ITO and BPO services beyond India and want to learn more about China’s ITO and BPO capabilities. In this book, we accumulate the findings of

Series Preface xix

the best research on China’s ITO and BPO sector by the top scholars in the field of information systems.

11. The Outsourcing Enterprise: From Cost Management to Collaborative Innovation is by Leslie Willcocks, Sara Cullen and Andrew Craig. The central question answered in this book, “How does an organization leverage the ever-growing external ser-vices market to gain operational, business, and strategic advantage?” The book covers the foundations of mature outsourcing enterprises that have moved out-sourcing to the strategic agenda by building the relationship advantage, select-ing and levering suppers, keeping control through core-retained capabilities, and collaborating to innovate. The book provides proven practices used by mature outsourcing enterprises to govern, design, and measure outsourcing. The final chapter presents practices on how mature outsourcing enterprises prepare for the next generation of outsourcing.

12. Governing through Technology by Jannis Kallinikos is thoughtful scholar-ship that examines the relationships among information, technology, and social practices. The author discusses the regulative regime of technology, and issues of human agency control and complexity in a connected world. He provides a valuable counter-perspective to show that social practices are, in part, unmistak-ably products of technologies; that technologies are, through historical processes, embedded in the social fabric; and that, if technological determinism is naive, the notion of the regulative regime of technology remains alive and well into the Internet age.

13. Enterprise Mobility: Tiny Technology with Global Impact on Information Work by Carsten Sørensen explores how mobile technologies are radically changing the way work is done in organizations. The author defines enterprise mobility as the deployment of mobile information technology for organizational purposes. The author contrasts how large technology projects in organizations, such as enter-prise resource planning (ERP) implementations, will increasingly be managed differently because of mobile technology. The introduction of mobile technology supporting organizational information work will often be driven by individuals, small teams, or as part of departmental facilitation of general communication services.

14. Collaboration in Outsourcing: A Journey to Quality, edited by Sjaak Brinkkemper and Slinger Jansen, is based on an integrated program of outsourcing research at Utrecht University in the Netherlands. The book is written for practitioners based on interviews and case studies in many global outsourcing firms, including Cisco, IBM, Deloitte, Infosys, Logica, and Partni, to name a few. The 16 chapters are short, tight, and written to communicate best practices quickly. The chapters cover the topics of governance, knowledge management, relationship manage-ment, and new trends in software development outsourcing,

In addition to the books already published and under contract, we have sev-eral other manuscripts under review but always need more. We encourage other researchers to submit proposals to the series, as we envision a protracted need

xx Series Preface

for scholars to deeply and richly analyze and conceptualize the complex rela-tionships among technology, work and globalization. Please follow the sub-missions guidelines on the Palgrave Macmillan website (http://www.palgrave.com). Stephen Rutt (Email: [email protected]) is the publishing director for the series.

Leslie P. WillcocksMary C. Lacity

July 2011

xxi

Contributors

Jonathan Aarnouts is a junior advisor at KPMG Advisory. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “IT Service Quality in Outsourcing Relationships,” which develops a model that addresses the estimation of IT service quality in an outsourcing relationship.

Koen Bos is co-founder and Chief Technology Officer at Synovite and a director at Celerity ICT. He is a professional Java developer and an entrepreneur. His goal is always to solve the actual business problems of his customers, putting the user up front and helping companies grow their business.

Sjaak Brinkkemper is Professor of Organization and Information in the Department of Information and Computing Sciences at Utrecht University. He leads a group of 20 researchers specialized in product software development and entrepreneurship. The main research themes of the group are the methodology of product software development, implementation, and adoption, and the business-economic aspects of the product software industry.

Aleksandar Chervenkov is a strategy and IT consultant at Agrologic Ltd. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he par-ticipated in a two-week research trip to India to study collaboration in IT out-sourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Initial Knowledge Sharing in Outsourcing,” which focuses on optimizing communication and knowledge sharing between outsourcing partners. The paper offers a solution to improve the initial knowledge sharing in outsourcing.

Matthias Fabriek is a researcher at Algemene Rekenkamer. He holds a Master’s in Business Informatics from Utrecht University. He is an experienced researcher and has published several papers. His has project managed two commissions for a student organization and has coordinated software development projects at Capgemini. For one year he was a board member of a student organization with more than 300 members, during which time he gained financial and business management experience.

Suzanne Gietema is Chief Operating Officer at Cedira B.V. She holds a Master’s in Business Informatics from Utrecht University. In 2010 she participated in a two-week research trip to India to study collaboration in IT outsourcing, visit-ing the head offices of global outsourcing players. After the trip, she wrote a paper titled “Distributed Requirements Management in an Offshoring Context,”

which deals with both functional and non-functional requirements. Her research discusses problems relating to distributed requirements management and their possible solutions.

Suzanne Haanappel is an IT trainee at Alliander. She holds a Master’s in Business Informatics from Utrecht University. In 2010 she participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, she wrote a paper titled “Mission-Critical Outsourcing,” which compares general outsourcing with the outsourcing of mission-critical applications.

Frank Harmsen is a director at Ernst & Young, a lecturer at Vrije Universiteit Amsterdam, and a professor at Maastricht University, where he holds the chair in Knowledge Management of Globally Distributed Work. He is a highly experi-enced consultant focused on improving and transforming IT organizations. He has been a consultant for more than 11 years, during which time he has worked at Capgemini and Ernst & Young, helping clients to transform their business in a sustainable way using IT as an enabler. His teaching experience includes lec-turing on the Information Management course in the postgraduate Executive Master of Finance and Control program, and he has investigated the transfer and management of knowledge processes that are distributed around the globe.

Remko Helms teaches and coordinates two subjects at Utrecht University: Strategic Management of Organizations, and ICT and Knowledge Management. His main research interest is knowledge management and networks, and he spe-cializes in intra- and inter-organizational knowledge sharing networks. He has previously taught on information systems, organizational theory, and research methods, among other subjects.

Koen Huijsman is an intern at PwC Nederland. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Project Coordination in Distributed Software Development,” which focuses on the distance between the different parts of an outsourcing organization. His research shows how the need for coordination in distributed software develop-ment projects can be minimized.

Elena Iancu is an advisor at Ernst & Young. She holds a Master’s in Business Informatics from Utrecht University. In 2010 she participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, she wrote a paper titled “Security: A Three-Dimensional Case Study,” which focuses on the security of exchanged data. This qualitative research addresses the differences that are intro-duced when an ICT process or service is outsourced offshore, best practices, the ways in which existing frameworks can help, and the benefits of a third-party assurance.

xxii List of Contributors

List of Contributors xxiii

Martin Janek is a consultant at Software Improvement Group. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Collaboration of Enterprise Architects in Outsourcing,” which focuses on the challenges encountered by enterprise architects who collaborate on an outsour-cing project and best practices to overcome them.

Slinger Jansen is an assistant professor in the Department of Information and Computer Science at Utrecht University. His research focuses on software product management and software ecosystems, with a strong entrepreneurial component. Jansen received his Ph.D. in Computer Science from Utrecht University for his thesis “Customer Configuration Updating in a Software Supply Network.”

Martin Kirilov holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Dealing with Trust in Outsourcing Relationships,” which uses empirical research to determine the circumstances that establish and maintain trust between the partners in an outsourcing relationship.

Gábor Majdán is a market researcher at Negometrix. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Governance Models in Offshore IT Outsourcing,” which explores the theory and practice of different outsourcing governance models and tabulates the most com-mon joint process fields at the operational level.

Paul Noordveld is an intern at INFOdation and a postgraduate student in Business Informatics at Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Conflict Resolution in Outsourcing,” which proposes a conflict resolution model that can be institutionalized.

Martijn Roeling is a student at Utrecht University and a co-worker at Super de Boer. In 2010 he participated in a two-week research trip to India to study collab-oration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Selection of Outsourcing Partners,” which focuses on determining the right company in India for outsourcing. The paper presents several methods to help companies establish a solid outsourcing rela-tionship.

Tomas Salfischberger is Managing Director and a co-founder at Synovite, and Founder at Celerity ICT. He is an enterprise software developer and entrepreneur with a focus on solving business problems from a user’s perspective. He likes to

xxiv List of Contributors

work with both sides of IT, bridging the gap between business and IT. His passion is to deliver software that not only meets requirements but also advances the business and makes users smile.

Wouter Steenbeek studied Information Science at Utrecht University and received his Master’s in Business Informatics in 2004. During his studies he devel-oped an interest in sociology, in particular in questions pertaining to social cohe-sion and social order. He then focused on the micro-level of individual actors, investigating “guardianship” by residents and “place management” by local entrepreneurs in 161 Dutch neighborhoods. Steenbeek continues to study these topics as a researcher at the Netherlands Institute for the Study of Crime and Law Enforcement (NSCR), focusing on longitudinal modeling of the reciprocal rela-tionship between business presence and crime.

Hristo Stefanov is an associate product manager at Google. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Boosting Distributed Collaboration through Collaboration Tools Portfolio Optimization,” in which he designed a method of selecting an optimal collabor-ation tools portfolio for distributed settings.

Roderick van Cann is a student assistant at Utrecht University and junior product manager at Stabiplan. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Optimal Team Composition in Distributed Software Development,” which describes a method for creating the optimal outsourcing team in a distributed software environment using simple activities.

Lidwien van de Wijngaert is an assistant professor in the Faculty of Behavioural Sciences at Twente University of Technology, Enschede. Previously she worked at the Institute for Information and Computing Sciences at Utrecht University and the Telematica Instituut, where she conducted her dissertation research into the relationship between task characteristics and new media choice. Her fields of interest are electronic government from a user perspective, the process of diffusion of innovations in terms of the adoption and use of new services and technologies, and the development of a method for meta-analysis using network analysis.

Mischa van den Brand is a highly experienced consultant in the area of software development and maintenance. He helps clients improve their IT performance through the implementation of software development best practices and indus-try-wide project and IT service management standards. He has a software engin-eering background and has been a consultant for more than 14 years, helping

List of Contributors xxv

improve the performance of both large (up to 1,000 people) and smaller financial IT departments. His expertise lies in agile software development in relation to IT outsourcing, on which he has published several articles.

Sander van Meggelen is a partner at WebsiteGroep and Founder at Internet Exploitatie Nederland. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Service Level Agreement in an Outsourcing World,” which compares different mechanisms for constructing effective service level agreements.

Antonios-Lavrentios Voutsinos is a technical associate at Google. He holds a Master’s in Business Informatics from Utrecht University. In 2010 he participated in a two-week research trip to India to study collaboration in IT outsourcing, visiting the head offices of global outsourcing players. After the trip, he wrote a paper titled “Retaining Project Knowledge in an Outsourcing Context,” which focuses on the collaboration tools portfolio. The paper discusses techniques or frameworks that support project learning and knowledge retrieval within a pro-ject organization in an outsourcing context.

xxvi

Company Profiles

This section provides an overview of the companies that Utrecht University’s Business Informatics research team visited in 2010 during its trip to India, as well as the companies that sponsored the research trip. For each company there is a brief general profile description. The companies are listed in alphabetical order.

Celerity ICT is a small IT company located in Utrecht and founded in 2004. The com-pany provides services in the Netherlands in the fields of CRM (Celerity CRM), con-sultancy services, IT auditing, and custom software development. The vision of Celerity ICT is to directly involve the client in the development process, providing transparent services and quick iterative feedback in both directions. The company’s mission is to be a trusted partner for its clients, putting their business goals first by means of IT services. Celerity ICT operates as a networked organization, providing core IT services itself, while working with trusted partners for peripheral activities. This network has been established over the years and consists of organizations that share this vision. Clients benefit from expertise from multiple parties under the governance of a single entity, thus always working with top players in each field.

Cisco is one of the world’s biggest technol-ogy corporations, designing and selling consumer electronics, networking, and com-munications technology and services. Cisco’s mission is to shape the future of the Internet by creating value and opportunity for cus-tomers, employees, investors, and ecosystem partners. Cisco aims to change the way the world works, lives, plays, and learns through a Product Leadership business strategy, internal innovation, growth by partnership and mergers, and a talent-centric network.

The company relies on systems and outsourcing partners for its context and non-mission-critical tasks, focusing on increasing productivity and using networking technology to appear as one virtual entity to its customers. Cisco Manufacturing produces currently 250-plus major product models in 13 manufacturing sites, design and production being fully outsourced to contracting partners; it has a wide network of suppliers, out of which 370 are active. The focus is on integra-tion as sustainable competitive advantage and diversity of product portfolio for long-term stability.

Company background

Headquarters Utrecht, Netherlands

Founded 2004

Company background

Headquarters San Jose, USA

Founded 1984

Employees 68,000

Revenue $40 billion

Net income $7.7 billion

Company Profiles xxvii

Cisco Systems India commenced operations in 1995 and currently has 6500 employees. The company has sales offices in New Delhi, Mumbai, Bangalore, and Hyderabad among other cities. Cisco Global Development Center in Bangalore is the largest outside of the United States. Also, Cisco has set up Joint Development Centers with Indian companies such as Wipro, Infosys, HCL, and Zensar. In the core technologies (router, switch, total LAN), the company is the market leader in India with a market share of over 67 percent. Cisco has key local customers from diverse sectors such as retail, banking and financial services, IT services, manu-facturing, state government, and courts.

coMakeIT is a specialized part-ner to product software compan-ies that researches and develops software products and solutions. It focuses on strategic and long-term partnerships with their cus-tomers by offering quality, speed, and agility. The company has three employees in the Netherlands who focus on sales (contracts are made with the Dutch branch) and customer relationship. The offshore location in Hyderabad, India, has 120 employees who are respon-sible for the development and handling of sales to the local market. coMakeIT follows a policy of high-level transparency with its clients, for example free con-tact with offshore teams and developers, detailed cost breakdown, and disclos-ure of the company’s own profit margins. In the near future, the company plans to open a sales office in Germany and more development locations throughout Asia.

Deloitte Touche Tohmatsu Limited is the largest privately owned professional ser-vices organization in the world. Deloitte offers audit, consulting, financial advis-ory, risk management, and tax services in more than 150 countries around the world. Industries in which the member firms operate include: consumer busi-ness and transportation; energy and resources; financial services; life sciences and health care; manufacturing; public sector; real estate; technology, media, and communications.

Deloitte in India is a subsidiary firm of Deloitte & Touche USA LLP, providing professional services and advice. Deloitte operates from its centers in Hyderabad and Mumbai. Deloitte Hyderabad focuses almost exclusively on extended deliv-ery for the US member firm.

Company background

Headquarters Harderwijk, the Netherlands

Founded 2006

Employees 120

Company background

Headquarters New York City, USA

Founded 1845

Employees 170,000

Revenue $26.1 billion

xxviii Company Profiles

IBM is a world leader in business and tech-nology services, enterprise software and systems. It has capabilities to deliver full ser-vice – from consulting, implementation, and integration, to financing and long-term cus-tomer support. The business services include business consulting, strategic outsourcing, and business transformation outsourcing. The company also offers technology consult-ing, system integration, cloud computing, application management, and so forth. IBM’s portfolio is comprised of well-known software products such as IBM Cognos, IBM WebSphere, IBM Tivoli, IBM Lotus notes, SPSS and many others.

IBM’s Indian branch dates from 1992 (after an exit in the 1970s) and currently has approximately 130,000 employees. The regional headquarters can be found in Bangalore, with 14 other offices in New Delhi, Mumbai, Kolkata, and Chennai. The company has established itself as one of the leaders in the Indian IT indus-try. The main focuses of the Indian operations are support, research, and product and software development. The fastest growing part of IBM is the IBM Global Services (IGS). It is the world’s, and also India’s, largest information technology services and consulting provider. IGS delivers integrated, flexible, and resilient processes – across companies and through business partners – that enable its cus-tomers to maximize the opportunities of an on-demand business environment. IGS’s expertise lies in servicing large multinational enterprises and governments. It has built an image of a reliable partner that customers can successfully depend on. Due to that, IGS might not be a suitable partner to smaller companies.

Infosys is one of the largest IT services com-panies in India serving global markets in more than 33 countries in America, Europe, and Asia Pacific. Infosys specializes in sev-eral domains: Business Process Outsourcing (BPO), IT services, consulting, and engin-eering. Its core capabilities are built around reliability, security, business continuity, 24/7 operations and delivery. Besides the headquarters in India, the company has established other development centers in China, Brazil, Australia, UK, Canada, and Japan.

Infosys offers consulting services in the following areas: IT strategy, product innovation, and core process excellence. A wide selection of IT services, including information management, system integration, enterprise architecture, knowledge, and packed application services, is available to Infosys’ clients. The company is active in industries such as aerospace and defense, banking and insurance, discrete

Company background

Headquarters Armonk, USA

Founded 1911

Employees 400,000

Revenue $96 billion

Net income $13.4 billion

Company background

Headquarters Bangalore, India

Founded 1981

Employees 115,000

Revenue $4.8 billion

Net income $1.3 billion

Company Profiles xxix

manufacturing, energy, logistics and distribution, and so forth. Infosys conveys the image of a highly reliable partner that could excel in large-scale projects that require reliability and security, business continuity, and on-time delivery of services.

Levi9 Global Sourcing is an IT group with development centers in Serbia, Ukraine, Turkey, and Romania, withsales offices in Belgium, Germany, UK, and the Netherlands. The company’s work methodology is based on the near-shore delivery services model that com-bines the quality, responsiveness, and flexibility associated with domestic out-sourcers with the cost savings of an “offshore” development facility located in Eastern Europe.

Logica is a business and technology ser-vice company, employing 39,000 people across 36 countries. Logica established its Indian branch in 1998. It has innovation centers in Bangalore and Chennai. Logica specializes in business consulting, sys-tems integration, and outsourcing across all industries and business functions. The company focuses on four market sectors: Energy Utilities and Telecom, Finance, the Public Sector, and Industry Distribution and Transport. Logica’s strength is based on the company’s industry and domain knowledge, and strong business and technological insight.

Logica strives to contribute to a more sustainable eco-system. Through internal awareness programs, the efforts of their people, and by harnessing technology, they are reducing the energy, carbon, and resource impact of their business. The company always tries to develop innovative products and solutions, for example, products using augmented reality. Logica has the practice of always placing a team at the client’s location. Also, the usage of standard templates within the particular project is emphasized.

Microsoft Corporation develops, manu-factures, licenses, and supports a wide range of software products and services for diverse devices. The company is organized into five business divisions. The Windows and Windows Live Division include the Windows product family as well as online software and services through Windows Live. This division is also responsible for

Company background

Headquarters Amsterdam, the Netherlands

Founded 2001

Company background

Headquarters Reading, England

Founded 1969

Employees 39,000

Revenue £3.7 billion

Net income £40 million

Company background

Headquarters Redmond, USA

Founded 1975

Employees 89,000

Revenue $62.5 billion

Net Income $18.76 billion

xxx Company Profiles

the company relationships with PC manufacturers worldwide. Server and Tools division consists of the software products and solutions such as Windows Server, Microsoft SQL Server, Visual Studio, Biz Talk server, and so forth. In this div-ision are the Microsoft Consulting Services that deliver enterprise consulting and product support services, training and certification to developers and informa-tion technology professionals, as well as building stand-alone and software devel-opment life-cycle tools for software architects, developers, testers, and project managers.

The company’s Online Services Division offers online information products, such as Bing, MSN portals, and channels, and an online advertising platform for publishers and advertisers. The fourth division is the Business Division. It includes the Microsoft Office suites (as well as Microsoft Office Web Apps), Microsoft SharePoint, Microsoft Dynamics ERP and CRM. This division also offers Unified Communications business solutions. The last business division of Microsoft is the Entertainment and Devices Division. It consists of the Xbox and Xbox Live gam-ing system, the Zune digital music and entertainment platform, Mediaroom (IP television software), Windows Phone, embedded device platforms, surface com-puting platform, and Windows Automotive.

Microsoft established its Indian operations in 1990. It currently employs 5500 people and has offices in 13 cities – Bangalore, Chennai, Hyderabad, Kolkata, Mumbai, and New Delhi, among others. Microsoft is becoming a key IT partner to the Indian government and industry. In the Hyderabad campus the company has established Microsoft India Development Center, Microsoft Global Services India, and Microsoft IT.

Patni is an Indian-based IT service provider that has offices in more than 29 international locations in the Americas and EMEA. Patni is active in several IT services and outsour-cing domains, for example, IT consultancy, application development, BPO and cus-tomer interaction services, web technology, enterprise integration, and infrastructure management.

The company’s vision is to achieve global IT services leadership in providing value-added high quality IT solutions to their clients in selected horizontal and vertical segments, by combining technology skills, domain expertise, process focus and a commitment to long-term client relationships. Its clients include 400 Fortune 1000 companies from diverse sec-tors, for example, financial services, manufacturing, life sciences, telecom, media, and entertainment, etc. Patni created the impression of being able to build long-term client relationships based on a high level of trust.

Company background

Headquarters Mumbai, India

Founded 1978

Employees 15,000

Revenue $656 million

Net income $120 million

Company Profiles xxxi

Royal Philips Electronics, based in Eindhoven, the Netherlands, creates different innovative prod-ucts in the healthcare, lighting, and consumer lifestyle sector and has several services to sup-port their products. Their mis-sion is to “Improve the quality of people’s lives through timely introduction of meaningful innovations.” Philips focuses on the professional and consumer market, both in emerging and mature markets, on a global scale.

Philips Electronics India Limited, a subsidiary of Royal Philips Electronics, was founded in 1996 and its headquarters is in Bangalore, India. Philips Innovation Campus (PIC) is a division of Philips India, focusing on innovations in the health-care, lighting, and consumer lifestyle sector by combining research and applied technology. Philips describes PIC as an important partner in business develop-ment, business processes, software services, electrical and mechanical hardware, and product development for global and emerging markets. The global support center for Philips worldwide is located at PIC, supporting all their sectors. One of the major focus areas in this center is the application development for prod-ucts in the healthcare and consumer lifestyle sector (e.g. firmware for televisions and MRI scanners). Other services are change management and managed opera-tions support. The agile development approach is used for software development, including the use of Scrum. Teams (and their members) are distributed geograph-ically, but largely located in India.

PIC has an open attitude toward (potential) customers and partners. This shows in their selection of new partners where they emphasize partner enthu-siasm rather than partner size. The open attitude of PIC creates trust; there is a corporate culture that welcomes discussion and combines this with a straight-to-the-point attitude.

SAP is the world’s leading provider of business software solutions. Its mission is to help its clients achieve consider-ably higher levels of effectiveness and efficiency in their business operations – profitable and sustainable growth by enabling closed-loop performance opti-mization. The company offers products and solutions that are tailored to spe-cific strategic industries such as bank-ing, retail, utilities, and the public sector. In addition, SAP has the capability of

Company background

Headquarters Eindhoven, the Netherlands

Founded 1891

Employees 121,000

Revenue €23.2 billion

Net income €424 million

Company background

Headquarters Walldorf, Germany

Founded 1972

Employees 48,000

Revenue €10.67 billion

Net income €1.75 billion

xxxii Company Profiles

consulting, maintaining, and training their customers in using SAP’s software solutions.

The product portfolio consists of key software applications such as SAP Business Suite (core business operations support for large enterprises), SAP Business All-in-One (suitable for the needs of SMEs), SAP BusinessObjects (Business Intelligence systems), SAP NetWeaver (integrated technology platform), and SAP solutions for sustainability. SAP is focusing on growing its portfolio of on-demand solutions that can increase the value for their clients and lower the total cost of ownership; also SAP is focused on continuing to co-innovate and collaborate with its cus-tomers and partner ecosystems. Solution and product development is performed in distributed environments at strategic markets across the world; development centers are found in Walldorf, Bangalore, and Palo Alto (in that order in terms of size). SAP has the capability of supporting its clients in adopting SOA-based technology, service-enabled applications, and pre-packaged enterprise services grouped as business scenarios to ensure service reuse, efficient IT operations, and cost reduction.

SAP India was established in 1996 and now has approximately 5,000 employ-ees; it is the fastest growing subsidiary of SAP AG. According to Dataquest, the company is the fastest growing among the TOP 20 IT firms in India. From the beginning of 2010, SAP India was strategically realigned with EMEA markets thus allowing greater resource allocation. The company’s HRM strategy “is focused on quality and not quantity” as stated by their senior managers. That is in high contrast to the other players in the Indian market. SAP India gave the impression of having a strong European corporate culture that is successfully coupled with Indian traits.