The risk-remedy method is beginning to replace cost-benefit or weighted scoring methods in the evaluation of information technology outsourcing tenders by the Australian Public Service. This paper describes the use of the method. It also describes some of the lessons that have been learnt from the use of the method in six tender evaluations: use the correct requirements, use requirements correctly, consider the cost of bidding, consider the cost of delay, check the bids carefully and use a design rather than a selection approach.
Get full access to this article
View all access options for this article.
References
1.
Australian Public Service Board (1981). A Guide to Cost-effectiveness Analysis of ADP Systems, (Australian Government Publishing Service, Canberra).
BorthickF., and ScheinerJ. (1998). Selection of small business computer systems: structuring a multi-criteria approach. Journal of Information Systems, 3(2), 10–29.
Department of Premier and Cabinet, Victoria Government (1997). Product and Service Evaluation Guidelines website www.dpc.vic.gov.au/ocmpol/216a.html of 14 Sep 1997.
10.
Department of Public Works and Services, NSW Government (1996). Management of the Information Management and Technologies Project: Guideline GDL5.3 – Risk Management website www.dpws.nsw.gov.au of 10 Sep 1996.
11.
DorfmanR. (1996). Why benefit-cost analysis is widely disregarded and what to do about it. Interfaces, 26(5), 1–6.
12.
EdwardsW. (1977). How to use multiattribute utility measurement for social decisionmaking. IEEE Transactions on Systems, Man, and Cybernetics, SMC-7(5), 326–40.
13.
FaheyJ. (1997). Outsourcing of Information Technology Infrastructure, Australian Commonwealth Government, Minister for Finance and Administration, Canberra.
14.
HartD. (1997). Modeling the political aspects of information systems projects using ‘information wards’. Failures and Lessons Learned in Information Technology Management, 1(1), 49–56.
15.
Industry Commission (1996). Competitive Tendering and Contracting by Public Sector Agencies (Australian Government Publishing Service, Melbourne).
16.
LacityM., and WillcocksL. (1998). An empirical investigation of information technology sourcing practices: lessons from experience. MIS Quarterly, 22(3), 363–408.
17.
LewisE.J.E. (1990a). Planning for Information Systems: The Need for a Systematic Evaluation Process. (University College, University of NSW, Australian Defence Force Academy, Canberra).
18.
LewisE.J.E. (1990b). The Nett Gain Process for Evaluating Options (University College, University of NSW, Australian Defence Force Academy, Canberra).
19.
LewisE.J.E., and NewtonC. (1995). The use of the grouputer in preparing information management plans, in Proceedings of the International Conference of the Institute for Operations Research and Management Science (INFORMS ‘95), Singapore, 25–28 June, pp. 24–8.
20.
McFarlanF.W. (1981). Portfolio approach to information systems. Harvard Business Review, 59(3), 142–50.
Morley-EnglishJ. (1984). Project Evaluation: A Unified Approach for the Analysis of Capital Investments (Macmillan, New York).
23.
MullerN. (1989). Structuring the RFP for risk avoidance. In Minimum Risk Strategy for Acquiring Communications Equipment and Services. (Datapro (McGraw-Hill), Delran, NJ, pp. 1–30.
PowellP., and KleinJ. (1996). Risk management for information systems. Journal of Information Management, 11, 309–19.
26.
Purchasing Australia (1996). Managing Risk in Complex Procurement (Australian Government Printing Service, Canberra).
27.
SaatyT. (1986). Decision Making for Leaders: The Analytic Hierarchy Process for Decisions in a Complex World (RWS Publications, Pittsburgh).
28.
SanthanamR., and KyparisisJ. (1995). A multiple criteria decision model for information system project selection. Computers and Operations Research, 22(8), 807–18.
29.
SchonerB., and WedleyW. (1989). Ambiguous criteria weights in AHP: consequences and solutions. Decision Sciences, 20, 462–75.
30.
SerafeimidisV., and SmithsonS. (1995). The management of change for a rigorous appraisal of IT investment: the case of a UK insurance organization, in Proceedings of the Third European Conference on Information Systems, DoukidisG. (ed.), Plenum Press, London, pp. 1–14.
WarneL. (1997). Organizational politics and project failure: a case study of a large public sector project. Failures and Lessons Learned in Information Technology Management, 1(1), 57–65.
36.
WillcocksL., and MargettsH.Risk and information systems: developing the analysis. InInformation Management: The Evaluation of Information Systems Investments, WillcocksL. (ed.) (Chapman & Hall, London), pp. 207–30.
37.
ZahediF. (1985). Data-base management system evaluation and selection decisions. Decision Sciences, 16, 96–108.
