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Knowledge Management in IT Outsourcing/Offshoring Projects

 

SECOND EDITION

Jarosław Polak, PMP

Przemysław Wójcik, PMP

AGH University of Science and Technology

Kracow, Poland

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Abstract

Outsourcing and offshoring in the Central Europe countries are increasingly common and they impact on sales and growth of global companies nowadays. This region attracts corporations from around the world because of the crucial costs reduction and by providing highly educated workforce with excellent language skills. The O&O projects in IT are a well-known trend; however, this sector is difficult, unstable and complex due to dynamic technology changes, frequent indecision of the customers and instability on the IT market. There are many challenges in O&O projects which can have potentially negative consequences, such as a loss or distribution of knowledge, when a company decides to outsource a part of its work abroad.

The aim of this paper is to present how companies can leverage knowledge management in O&O projects. The researchers indicate the barriers and facilitators in KM process and point out how maturity and experience in PM and KM are important in project life cycle.

The study was initiated by a review of literature, followed by a set of informal, conversational interviews which helped to determine areas of interests and prepare a list of the final questions. The last part of the research consisted of several standardized, open-ended interviews with members of top management, boards, executives and projects managers employed by medium and big companies implementing IT projects in Poland.

Introduction

A characteristic feature of service development is nowadays creating centers of support services and the transfer of business services between countries. The key here is the strategy of transnational corporations, which move a range of their activities outside the home office. Usually, it refers to activities and business processes that are not core business and can be successfully pursued outside the main seat of the organization. This is due to the phenomenon of globalization in the world economy. The changes result from, at least, two reasons. On the one hand, they are effects of competition and the consequent need to find ways of increasing productivity and efficiency of the company, where the reduction of operating costs is one of the basic methods. On the other hand, rapid technological development of Information and Communication Technologies (ICT) facilitates the development of successful models in the field of provision of business services. In practice, this amounts to the creation of outsourcing and offshoring centers.

Reports of A. T. Kearney Global Services Location IndexTM (The AT Kearney Global …, 2011.2014) indicating the most interesting countries as far as investing in offshoring services is concerned, show that the top three countries have remained unchanged over the recent years. These are still India, China and Malaysia. However, a very significant place on the list belongs to the countries of Central and Eastern Europe (CEE). This is due to several factors, among others, to favorable business environment, financial attractiveness, or still cheaper and highly educated workforce, as well as the fact that most countries in the region are members of the European Union. One of the leaders is Poland, which over the last three years, has jumped thirteen positions up the list. About 40 percent of IT sector companies are in Krakow, Poland’s “Silicon Valley.” Among the global providers in Poland are IBM, HP, Accenture, Atos, Capgemini, and HCL, alongside tech giants such as Google and Cisco (The A.T. Kearney… 2014). The slide of the Baltic States in the ranking may be surprising (Latvia by 10 and Estonia by 11 positions), but the rate has not changed significantly, which means that there has not been a deterioration of conditions for O & O project and the countries are still attractive to investors.

The scope of outsourcing and offshoring is wide and can cover: financial services, logistics, HR and IT. In IT projects the key factor is knowledge management, especially when tasks are performed beyond the client’s site or are carried out by an independent entity.

More…

To read entire paper (click here)

Editor’s note: Second Editions are previously published papers that have continued relevance in today’s project management world, or which were originally published in conference proceedings or in a language other than English. Original publication acknowledged; authors retain copyright. This paper was originally presented at the 4th Scientific Conference on Project Management in the Baltic States, University of Latvia, April 2015. It is republished here with the permission of the author and conference organizers.

 



About the Authors


pmwj37-Aug2015-Polak-PHOTO WOJCIKPrzemysław Wójcik

Krakow, Poland

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Przemysław Wójcik has been working as a Project Manager for over 6 years in different areas and sectors. He is actually involved in delivering solutions for finance and banking sector. He has gained a BSc. in IT, a professional master’s degree in IC. He is also currently a PhD candidate with a specialization in knowledge management. He has gained international and professional project management experience while working for global companies. He is PMP, P2P certified professional and he has rich & diverse experience in delivering complex projects. In addition to his professional work, he is also a lecturer at the University of Science and Technology in Cracow, Poland for the professional master study program in Project management. He is the author of several scientific and business publications. Przemysław can be contacted at [email protected].

 

pmwj37-Aug2015-Polak-PHOTO POLAKJaroslaw Polak

Krakow, Poland

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Jaroslaw Polak
has been working in the telecommunications industry, especially in mobile telephony, for over 20 years. He holds a master’s degree in telecommunications engineering. He has also completed postgraduate studies in management (based on MBA programme). He is currently a PhD student with a specialization in management sciences. The areas of his scientific interests are issues related to inter-organizational relations. He has gained a broad managerial experience participating and managing the implementation of projects related to the construction and expansion of mobile networks in Poland. He was a project manager of a number of the telecommunication projects such as the exchange and sharing of technical infrastructure, introduction of new technologies (3G, CDMA, HSDPA +, LTE) and functionalities in mobile networks. He is PMP certificated professional and the author of several scientific publications. Jaroslaw can be contacted at [email protected].