Outsourcing ICT services

Outsourcing ICT services 1 Executive Summary Small and Medium Businesses (SMBs) have a disadvantage in using Information Communication Technology (ICT) in comparison with large enterprises. Often SMBs have limited ICT capabilities which limits them in automating important business processes. A new form of outsourcing ICT services, Software as a Service (SaaS) provides SMBs with opportunities to outsource their ICT services. SaaS can be compared to a utility service in the sense that similar to electricity standard ICT solution will be obtained from a service supplier through the Internet. ICT is being used more and in more different ways in organisations. This persuasiveness of off ICT is affecting organisations in how they do their business and how they are organised. This increased impact and dependency of ICT has lead many organisations to the decision to outsource all or part of their ICT services to third party providers. The increasing maturity of the Internet and the introduction of new technology standards enabled to development of SaaS. This provided organisations with a third sourcing option (renting) to obtain ICT solutions in addition to the traditional make or buy options. The Technological, Organisational and Environmental (TOE) technology adoption framework was adjusted for SaaS to find out whether SaaS could provide significant opportunities to SMBs. A survey was held among 10.000 SMBs from the Construction and Rental & Business Services industries. This survey confirmed the factors of the TOE framework that influenced the adoption of SaaS and its main advantages and risks. It was found that a good understanding of the SaaS concept has a significant influence on the adoption of SaaS. The business related advantages, like lower the ICT investments and costs, shorter implementation periods and unrestricted access to software, were found more important than technical advantages and the same conclusion was found for risks of SaaS. In order to obtain the advantages of SaaS, SMBs should outsource those business processes using SaaS that are supporting the core business processes of the organisation.