OUTSOURCING AND Offshoring in education Kathryn Urbaniak, HPT
Definitions • What is outsourcing? • The process of contracting a business function to someone else • What is offshoring? • the relocation of a business process from one country to another Source: Wikipedia
Outsourcing in Education • What outsourcing occurs in environments like universities? • 75% food services • 46% bookstores • 10-20% some or all of their distance education • Also common in the private sector • Training • Human Resources • IT functions Gupta, A., Herath, S K.,& Mikouiza, N.C. (2005). Outsourcing in higher education: an empirical examination. The International Journal of Educational Management, 19(5), 396-412. McCord, A. (2002). Are You Ready to Discuss IT Outsourcing on Your Campus? Educause Quarterly, 1 (2002), 12-19.
Why Outsource? • Reasons for outsourcing? • Pros and cons?
Norway E-learning Case Study • What issues may have arisen? And what benefits gained? • Benefits • Novel approaches • Didn’t have to train in-house • Ongoing relationships • Findings – important factors in selecting a vendor • Intrapersonal skills • Language • Cultural sensitivity • Experience in the education sector • Clarity in scoping and ordering Brodahl, C. & Oftedahl, H. (2012). Outsourcing Systems Development for e-Learning Applications. International Journal on E-Learning, 11(1), 5-22
Take Away Advice/Hand Out • 5 key aspects to consider before outsourcing an e-learning project. (Layton, 2011) • How time critical is the project? How busy is your internal team? • Do you require expertise that is not available internally? • Does the e-learning project involve sensitive information? • Does the project require tight management and control? • Where do you need to build eLearning experience for future work? • Best practices for selecting an e-learning vendor (O’Leonard, 2005)
Hidden Costs in Offshoring Large IT-based Projects What % of your saving will you end up spending on hidden costs? • The Cost of Selecting a Vendor • 1-10% • The Cost of Transition and Ramp Up • 3-13% • The Cost of Managing an Offshore Contract • 6-10% • The Cultural Cost • 3-27% Total: 13-60% Overby, S. (2003) The Hidden Costs of Offshore Outsourcing. CIO Magazine. September 01, 2003