The Role of Contracts and Informal Relations in the Governance of IT Outsourcing Processes

This paper aims to give a contribution to represent and comprehend the characteristics of the relationships between customers and providers in the specific context of IT services supply; furthermore it provides its peculiar perspective on the relationship between the formal governance, which is mostly realized through the use of contracts, and the informal relations based on trust and commitment between the parties. Moreover, the current study underlines that within contexts which are strongly based on the uncertain evolution both of market and technology, the governance of IT outsourcing processesneeds the development of complex informal relationships in support of the contracts. The study shows how it is possible to absorb the effects of the market and technology uncertainty within the IT outsourcing contracts. Moreover, the research shows how the use of dynamic contracting together with an explicit attention to the social processes can lead to remarkable operative and strategic benefits. © 2010 Springer-Verlag Berlin Heidelberg.