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The liberalization of global trade has placed companies under unprecedented competitive pressures. A popular method to reduce costs and make is for companies to outsource important functions, like information systems. The present study examines the effects of the outsourcing of information systems by hospitals on user satisfaction. The sample comprised 166 employees at 12 hospitals in Taiwan, each of whom completed a specially-developed questionnaire that assessed their feelings an about different aspects of the outsourcing process. The subjects' responses were subjected to a principal components factor analysis to identify the main factors associated with positive and negative reactions to the process. The results suggest that eight percent of the variance in user satisfaction is attributable to the negative aspects of outsourcing and 16 per cent to its positive aspects. Implications of the findings for the effective management of information systems especially at hospitals are discussed. Introduction The liberalization of global trade has placed Taiwanese companies under unprecedented competitive pressure. Businesses thus must understand how to maintain their competitive advantage and overcome the critical problem of global competition. Information technology adoption offers a means of saving costs and increasing administrative efficiency. Krass (1990) indicated that outsourcing IT services can save 10-50% in IT expenditures. Outsourcing thus has become a basis strategy in the information system field (Akomode et al., 1998) and has recently grown considerably in popularity. IDC (2005) reported that the software outsourcing market has grown from 10% to 12%. Gartner (2008) also described that the global IT services market is expected to exceed $755 billion, with software outsourcing comprising 41%). Furthermore, outsourcing grew from 54.2% to 74.4% between 2007 and 2008 in large enterprises in Taiwan, and is expected to increase from 55% to 65% (FIND, 2006). In practice, hospital information system (HIS) is a complex system that needs to be integrated with medical treatment, medical research, administrative processes, financial affairs, accounting, and services to serve outpatients, but few hospitals lack sufficient IT staff to implement it. Software outsourcing thus offers a useful method of building up information systems under limited resource environments. Although numerous companies are turning to outsourcing to cut costs and improve organization performance, IT services have become a key determinant of outsourcing success. Several construct are used to measure the quality or effectiveness of software outsourcing, including system quality, system usage, user behavior/attitudes, information satisfaction (Ives and Olson, 1984; Zviran, 1992; Ribiere et al., 1999) and SERVQUAL (which includes tangibles, reliability, responsiveness, assurance and empathy in comparing the difference between the expected and perceived.) (Parasuraman et al., 1985, 1988; Zeithaml et al., 1990). Yoon and Im (2008) also proposed an instrument of IT outsourcing customer satisfaction (ITOCS) involving consulting service quality, maintenance and repairing, education, SLA quality, and information quality to test the association with the firm performance. In fact, previous works indicated that users may have negative mood arising from negative memories or impressions of specific incidents, possibly resulting in a decline in overall satisfaction. Friman et al. (2001) utilized negative critical incidents (NCIs) to explain customer satisfaction with public transport services. In fact, users are unlikely to have a long memory of specific critical incidents, but may accurately judge the frequency of the negative critical incidents (Friman et al., 2001). Relationships exist among overall cumulative satisfaction (OACS), attribute-specific cumulative satisfaction (ASCS) and negative critical incidents. For example, attribute-specific cumulative satisfaction is positively related with overall satisfaction, and NCIs frequency is negatively related with overall satisfaction. … |
