A Review on Outsourcing with a Special Reference to Telecom Operations

Outsourcing is not a recent phenomenon in the industry. Companies have been outsourcing non-core services or functions for many years. Outsourcing of IT management picked up in the late 80's and since then it has mushroomed into a multi-billion dollar industry. Initially the key driver for outsourcing was controlling operational expenses but over the period of time several other factors have been prominent such as flexibility in control of investments and resources, risk sharing, acquisition of special skills and competencies, revenue sharing, establishing long term strategic relationship, etc. The decision of outsourcing attaches special significance in the strategy formulation in the company or any operation. Large numbers of research papers have been published in the past two decades on outsourcing and researchers have studied and analyzed various internal and external factors having bearing on outsourcing decision. Over a period of time new business models and frameworks have emerged helping decision makers in the process. Some researchers have adopted research methodologies that are case studies based or while others have designed empirical formulations by conducting extensive surveys. Interestingly most conclusions from these studies tend to converge on similar set of key factors. This paper provides detailed review of the published research body of knowledge on outsourcing IT management and explores relevance to telecom operations. In the case of telecom operators, it is observed that the basic set of parameters influencing the decision of outsourcing is same as rest of the industry. In the recent past, it is observed that telecom operators have extended this model by outsourcing management of network infrastructure, management of towers, billing systems, marketing, etc. This is creating new working models and relationships. The paper concludes by providing the direction for the future research work in this domain