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However new issues surfaced relating to the skills the outsourcing companies were able to provide and their ability, at times, to meet the needs of Alpha. 158 J. Fisher et al. Delta was unsuccessful in their bid for more work under the new contractual arrangements. Alpha and Delta also undertook renegotiation of their agreement at this time, to make it operationally consistent, and to address business disquiet over cost and performance quality. This negotiation failed, as Alpha had very little leverage, and Delta had no incentive to modify the existing terms and conditions, or to forego guaranteed contract revenues.
IS outsourcing is where an organization outsources at least 80% of their budget to a third-party provider. Selective sourcing is where an organization uses third-party vendors for some of the IT functions but still retains a substantial IT department. Over, at least the last 20 years, the outsourcing of IT services and functions as a business option has been relatively commonplace (McFarlan & Nolan 1995; Earl 1996; Lee, Huynh, Kwok, & Pi 2003). Outsourcing as a research interest has also been growing with numerous studies reported and papers written (Dibbern, Goles, Hirschheim, & Jayatilaka 2004).
The myths and realities of information technology insourcing. Communications of the ACM, 43(2), 99–107. , & Valor, J. (2007). The implications of offshoring on the is discipline: Where perception meets reality. Communications of the Association for Information System, 20(51), 824–835. , & Hawk, S. (2004). Evolution of offshore software development: from outsourcing to co-sourcing. MISQ Executive, 3(3), 69–81. , & Kakabadse, N. (2002). Trends in outsourcing: contrasting USA and Europe. European Management Journal, 20(2), 189–198.