Myths about outsourcing to application service providers

Which applications are organizations outsourcing to ASPs? What did they hope to gain? And what are the critical success factors for organizations using ASPs? To assess these issues we cosponsored a study to assess organizational attitudes and adoption metrics for ASPs. Our survey garnered 256 usable responses from businesses regarding their use of ASPs. The study indicated that a significant number of respondents believed ASPs offer a fast-track way of implementing IT projects. However, 80 percent also favored internal implementation for core IT projects, which suggests that other factors still present a substantial barrier to ASP adoption. Nevertheless, companies are outsourcing some core applications - such as supply chain management and e-commerce - and several non-core applications. This outsourcing implies that companies perceive a significant benefit to ASP adoption. The message for users is unambiguous: to succeed, understand how Internet outsourcing works for your company, benchmark against successful ASP adopters, and establish a common criterion for evaluating an ASP.