Question:

(a) What could be the motivations for a small and medium enterprise engaged in a non-IT activity to outsource its IT function?

(b) What could be the risks for the small and medium enterprise to outsource its IT function?

(c) Describe a framework which would help the small and medium enterprise decide which IT activities to outsource.

(d) Use the above framework to make recommendations in the cases below:

? A university having to develop an information system for lecturer-student interaction. The university does not have experienced IT staff. However, the system is very important in providing personalised attention to the students - which the university believes is important to differentiate itself from its competitors.

? A new retail bank requiring a complete banking solution for its operational activities. It does not consider that the system will be its competitive edge - it considers that the quality of service delivered by its staff to be more important.