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A Novel Dynamic Algorithm for IT Outsourcing Risk Assessment Based on Transaction Cost Theory
Joint Authors
Source
Discrete Dynamics in Nature and Society
Issue
Vol. 2015, Issue 2015 (31 Dec. 2015), pp.1-10, 10 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2015-01-06
Country of Publication
Egypt
No. of Pages
10
Main Subjects
Abstract EN
With the great risk exposed in IT outsourcing, how to assess IT outsourcing risk becomes a critical issue.
However, most of approaches to date need to further adapt to the particular complexity of IT outsourcing risk for either falling short in subjective bias, inaccuracy, or efficiency.
This paper proposes a dynamic algorithm of risk assessment.
It initially forwards extended three layers (risk factors, risks, and risk consequences) of transferring mechanism based on transaction cost theory (TCT) as the framework of risk analysis, which bridges the interconnection of components in three layers with preset transferring probability and impact.
Then, it establishes an equation group between risk factors and risk consequences, which assures the “attribution” more precisely to track the specific sources that lead to certain loss.
Namely, in each phase of the outsourcing lifecycle, both the likelihood and the loss of each risk factor and those of each risk are acquired through solving equation group with real data of risk consequences collected.
In this “reverse” way, risk assessment becomes a responsive and interactive process with real data instead of subjective estimation, which improves the accuracy and alleviates bias in risk assessment.
The numerical case proves the effectiveness of the algorithm compared with the approach forwarded by other references.
American Psychological Association (APA)
Cong, Guodong& Chen, Tinggui. 2015. A Novel Dynamic Algorithm for IT Outsourcing Risk Assessment Based on Transaction Cost Theory. Discrete Dynamics in Nature and Society،Vol. 2015, no. 2015, pp.1-10.
https://search.emarefa.net/detail/BIM-1060470
Modern Language Association (MLA)
Cong, Guodong& Chen, Tinggui. A Novel Dynamic Algorithm for IT Outsourcing Risk Assessment Based on Transaction Cost Theory. Discrete Dynamics in Nature and Society No. 2015 (2015), pp.1-10.
https://search.emarefa.net/detail/BIM-1060470
American Medical Association (AMA)
Cong, Guodong& Chen, Tinggui. A Novel Dynamic Algorithm for IT Outsourcing Risk Assessment Based on Transaction Cost Theory. Discrete Dynamics in Nature and Society. 2015. Vol. 2015, no. 2015, pp.1-10.
https://search.emarefa.net/detail/BIM-1060470
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-1060470