Page 472 - Using MIS

440 Chapter 11 Information Systems Management

and Internet-enabled service databases, a single service call can be initiated in the United
States, partially processed in India, then Singapore, and finalized by an employee in England.
The customer knows only that he has been put on hold for brief periods of time.
International outsourcing is particularly advantageous for customer support and other
functions that must be operational 24/7. Amazon.com, for example, operates customer service
centers in the United States, India, and Ireland. During the evening hours in the United States,
customer service reps in India, where it is daytime, handle the calls. When night falls in India,
customer service reps in Ireland handle the early morning calls from the east coast of the United
States. In this way, companies can provide 24/7 service without requiring employees to work
night shifts.
By the way, as you learned in Chapter 1, the key protection for your job is to become some-
one who excels at nonroutine symbolic analysis. Someone with the ability to find innovative ap-
plications of new technology is also unlikely to lose his or her job to overseas workers.

What Are the Outsourcing Alternatives?

Organizations have found hundreds of different ways to outsource information systems and
portions of information systems. Figure 11-5 organizes the major categories of alternatives ac-
cording to information systems components.
Some organizations outsource the acquisition and operation of computer hardware.
Electronic Data Systems (EDS) has been successful for more than 30 years as an outsource ven-
dor of hardware infrastructure. Figure 11-5 shows another alternative: outsourcing the comput-
ers in the cloud via IaaS.
Acquiring licensed software, as discussed in Chapters 4 and 12, is a form of outsourcing.
Rather than develop the software in-house, an organization licenses it from another vendor.
Such licensing allows the software vendor to amortize the cost of software maintenance over
all of the users, thus reducing that cost for all who use it. Another option is Platform as a Service
(PaaS), which is the leasing of hardware with preinstalled operating systems as well as possibly
DBMS systems. Microsoft’s Azure is one such PaaS offering.
Some organizations choose to outsource the development of software. Such outsourcing
might be for an entire application, as with PRIDE, or it could also be for making customizations
to licensed software, as is frequently done with ERP implementations.
Yet another alternative is Software as a Service (SaaS), in which hardware and both operat-
ing system and application software are leased. Salesforce.com is a typical example of a com-
pany that offers SaaS.
It is also possible to outsource an entire system. PeopleSoft (now owned by Oracle) at-
tained prominence by providing the entire payroll function as an outsourced service. In such a

Hardware Software Data Procedures People

Example:
IaaS cloud hosting
Licensed software /
Outsourced development
PaaS

SaaS

System
Figure 11-5 Business
IS/IT Outsourcing Alternatives function