Reasons for ICT service outsourcing and the impact on organizational financial performance

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University of Dar es Salaam
Recently, a good number of business firms and particularly in Tanzania, have been adopting outsourcing of some of their operations. Therefore, the main purpose of this study was to assess the factors cited to contribute to the outsourcing decision and to examine the impact outsourcing has on financial performance. Hence, determination of reasons influencing outsourcing decision was the main objective of the study. And specifically, the study intended to assess the extent to which operations costs have an influence on organization decision to outsource, to find out if competencies have an influence on organization decision to outsource. Also, to examine whether or not internal resources can influence organization decision to outsource, to establish if technological capabilities have an influence on outsourcing decision, and to find out if outsourcing has an impact on organization financial performance. The study used regression analysis to assess the relationship between factors; operations costs, competencies, internal resources and technological capabilities on outsourcing decision and the impact of outsourcing on financial performance. The findings of the study revealed that only operations costs are significant driver of outsourcing decision. Also, it was further established that outsourcing has a positive and significant impact on financial performance. From the findings of the study, it was concluded that the motivation that is significant to the outsourcing decision are only operations costs. Likewise, it was concluded that outsourcing will help organization improve its financial performance.
Available in print form, East Africana Collection, Chagula Library, Class mark Dr. Wilbert (THS EAF HD2385.T34N3753)
Information technology, Contracting out, Financial performance, Tanzania
Ndedya, E. (2014) Reasons for ICT service outsourcing and the impact on organizational financial performance, Master dissertation, University of Dar es Salaam, Dar es Salaam