The Development of Model on Operational Capabilities of IT Vendor Serving Offshore Services: Case Study in an Indonesian IT Company

Offshore IT (information technology) outsourcing is an interesting business opportunity for Indonesian software vendors. However, Indonesian software vendors have not been able to enjoy the financial benefits since IT offshoring market are dominated by software vendors from India and China. This study tries to find out how to develop IT vendor's operational capabilities to serve offshore projects. A conceptual research model was developed using (Jarvenpaa, 2008) as a major literature together with (Guopeng & Bo, 2008, ) and (Wade & Hulland, 2004). Operational capabilities discussed in this study include process, HR, client-specific, and technology capabilities. For the part of the research reported in this paper, a case study was done using semi structured interviews in an Indonesian IT company has executed several offshore projects. This study collects some good practices that had been implemented to develop company's operational capabilities and enhance company's competitive advantage.