Published by:
Harvard Business Publishing
Length: 9 pages
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Abstract
In 1993, BP Exploration Operating Co Ltd, the $13 billion division of British Petroleum Co. that explores for and produces oil and gas, outsourced all its information technology operations in an effort to cut costs, gain more flexible and higher quality IT resources, and refocus the IT department on activities that directly improve the overall business. BP Exploration took a different path to outsourcing than most companies have taken. The company sought a solution that would allow it both to buy IT services from multiple suppliers and to have the pieces delivered as if they came from a single supplier. To that end, three contractors were hired and required to work together to deliver a single seamless IT service. This arrangement--multiple IT suppliers that act as one--is the cornerstone of the company's outsourcing strategy. The IT department has final accountability for IT services, but it is not mired in the operations. Only by relinquishing operations could IT employees begin to focus on doing business instead of running the business.
About
Abstract
In 1993, BP Exploration Operating Co Ltd, the $13 billion division of British Petroleum Co. that explores for and produces oil and gas, outsourced all its information technology operations in an effort to cut costs, gain more flexible and higher quality IT resources, and refocus the IT department on activities that directly improve the overall business. BP Exploration took a different path to outsourcing than most companies have taken. The company sought a solution that would allow it both to buy IT services from multiple suppliers and to have the pieces delivered as if they came from a single supplier. To that end, three contractors were hired and required to work together to deliver a single seamless IT service. This arrangement--multiple IT suppliers that act as one--is the cornerstone of the company's outsourcing strategy. The IT department has final accountability for IT services, but it is not mired in the operations. Only by relinquishing operations could IT employees begin to focus on doing business instead of running the business.