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The Impact Of Information Technology Outsourcing On Firm Profitability Measures, G. Dwayne Whitten, T Selwyn Ellis, K. Michael Casey
The Impact Of Information Technology Outsourcing On Firm Profitability Measures, G. Dwayne Whitten, T Selwyn Ellis, K. Michael Casey
Journal of International Information Management
Some researchers have concluded that outsourcing of information technology (IT) provides benefits to firms including cost advantages, economies of scale and allowing more of a focus on core competencies. This paper attempts to determine if these benefits actually exist by comparing three financial measures, return on equity (ROE), return on assets (ROA) and profit margin, affirms that have varying levels of outsourcing. To empirically test for the existence of a difference between firms that outsource differing amounts of IT spending, data from 104 companies was gathered. Analysis of variance was selected as the primary statistical tool to test the relationship …