Impact of Outsourcing Web Development Projects on Business Performance

This study analyzes the impact of outsourcing web development projects on business performance, with a focus on the IT industry in Singapore. It examines the advantages and disadvantages of outsourcing, the relationship between outsourcing and business performance, and the factors affecting implementation. The study aims to determine the extent of outsourcing in web development projects and its impact on business performance.

Running head: IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON
BUSINESS PERFORMANCE
Impact of outsourcing web development projects on business performance: Case study of
Singapore’s IT Industry
Name of the Student:
Name of the University:

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
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Abstract
Outsourcing is such a strategic management model which transfer of business processes to other
company. It is a concept of day-to-day execution of one and more than one business functions to
be performed by the third part service provider those are insourcing of the business processes.
When the organization is outsourcing the activities, there is focus on retaining of core activities
and allow the organizations to handle of non-core activities. At the time of outsourcing, proper
organizational decisions are taken. It can improve the structure of cost along with profitability. It
helps to improve entire operational effectiveness. Outsourcing of business operations are fallen
under three categories such as increase in revenue, improvement capabilities and reduction of
cost. The study is focused on impacts of outsourcing on the organizational performance as well
as challenges into implementation of outsourcing. The businesses are mainly looking for
outsourcing of the financial and accounting functions to improve the business performance.

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Acknowledgement
The research is conducted to enrich the experience of my life. The research enhances my
knowledge and skills on the selected research topic. With gaining of the knowledge, it give me
opportunity to face some challenges and overcome them. Without the guidance of my professors,
friends and family, I would not able to complete the study. They all contribute me to enhance my
knowledge on the research topic. I would also like to thank my supervisor -------------- for
providing me constant support and guidance during the entire research process. Without all their
help, I am not able to collect primary data and valuable resources. Finally, I would also like to
thank the professionals from the IT Industry who help me to participate in the survey. It also
provides us valuable results for the project work. All their support inspires and enlightens me to
go through the research process.
Heartfelt thanks and warmest wishes,
Yours Sincerely,

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Table of Contents
Chapter 1: Introduction....................................................................................................................7
1.1 Introduction............................................................................................................................7
1.2 Background of the project.....................................................................................................7
1.3 Research aim and objectives..................................................................................................7
1.4 Research question..................................................................................................................7
1.5 Purpose of the research..........................................................................................................7
1.6 Overview of the research report............................................................................................8
Chapter 2: Literature Review...........................................................................................................9
2.1 Introduction............................................................................................................................9
2.2 Advantages of outsourcing in web development projects.....................................................9
2.3 Risks into IT outsourcing.....................................................................................................10
2.4 Web development projects and outsourcing issues.............................................................11
2.5 Theoretical literature review................................................................................................12
2.5.1 Strategic evaluation and outsourcing performance.......................................................13
2.5.2 Contractual completeness and outsourcing performance.............................................13
2.5.3 Relationship management and outsourcing performance.............................................14
2.6 Outsourcing practices..........................................................................................................14
2.7 Impacts on the business performance due to outsourcing...................................................15
2.8 Relationship between outsourcing and business performance into web development
projects.......................................................................................................................................17
2.9 Factors affect implementation of outsourcing in web development projects......................19
Chapter 3: Proposed Methodology................................................................................................22
3.1 Introduction..........................................................................................................................22
3.2 Research philosophy............................................................................................................22

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3.3 Research approach...............................................................................................................22
3.4 Research design...................................................................................................................23
3.5 Data collection and analysis................................................................................................24
3.5.1 Data collection methods...............................................................................................24
3.5.2 Data analysis methods..................................................................................................25
3.6 Population and sample.........................................................................................................25
3.7 Ethical considerations..........................................................................................................26
3.8 Research limitations.............................................................................................................26
3.9 Research Timeline...............................................................................................................27
3.10 Summary............................................................................................................................27
Chapter 4: Results and analysis.....................................................................................................28
4.1 Introduction..........................................................................................................................28
4.2 Quantitative analysis............................................................................................................28
4.3 Summary..............................................................................................................................47
Chapter 5: Conclusion...................................................................................................................48
5.1 Conclusion...........................................................................................................................48
5.2 Linking with objectives.......................................................................................................48
5.3 Recommendations................................................................................................................49
5.4 Further scope of the study....................................................................................................49
References......................................................................................................................................50
Appendix........................................................................................................................................55
Survey Questionnaire.................................................................................................................55

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Table of Figures
Figure 4.1: Gender of respondents.................................................................................................29
Figure 4.2: Age group....................................................................................................................30
Figure 4.3: Years working in IT industry......................................................................................30
Figure 4.4: Company engages into IT outsourcing.......................................................................31
Figure 4.5: IT activity impact on cost and revenue of organization..............................................32
Figure 4.6: Reason for outsourcing is financial advantages..........................................................33
Figure 4.7: Effect of cost driven outsourcing on organizational performance..............................34
Figure 4.8: Outsourcing reduces time taken to develop new products..........................................35
Figure 4.9: Satisfaction of customers with company’s products...................................................36
Figure 4.10: Development of new products and services for maintaining of competitiveness.....37
Figure 4.11: Outsourcing innovation is better and faster for improvement of business
performance...................................................................................................................................38
Figure 4.12: Outsourcing enables to concentrate on efforts to build and expand best world
competencies..................................................................................................................................40
Figure 4.13: Outsourcing creates flexibility in organizational structure and strategy...................41

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Table of tables
Table 4.1: Gender..........................................................................................................................29
Table 4.2: Age group of respondents.............................................................................................29
Table 4.3: Years working in IT industry.......................................................................................30
Table 4.4: Company engages into IT outsourcing.........................................................................31
Table 4.5: IT activity impact on cost and revenue of organization...............................................32
Table 4.6: Reason for outsourcing is financial advantages...........................................................33
Table 4.7: Effect of cost driven outsourcing on organizational performance...............................34
Table 4.8: Outsourcing reduces time taken to develop new products...........................................35
Table 4.9: Satisfaction of customers with company’s products....................................................36
Table 4.10: Development of new products and services for maintaining of competitiveness......37
Table 4.11: Outsourcing innovation is better and faster for improvement of business performance
.......................................................................................................................................................38
Table 4.12: Outsourcing enables to concentrate on efforts to build and expand best world
competencies..................................................................................................................................39
Table 4.13: Outsourcing creates flexibility in organizational structure and strategy....................41
Table 4.14: Summary output of regression analysis conducted for hypothesis 1.........................42
Table 4.15: ANOVA table of regression analysis conducted for hypothesis 1.............................43
Table 4.16: Coefficient table of regression analysis conducted for hypothesis 1.........................43
Table 4.17: Summary output of regression analysis conducted for hypothesis 2.........................44
Table 4.18: ANOVA table of regression analysis conducted for hypothesis 2.............................44
Table 4.19: Coefficient table of regression analysis conducted for hypothesis 2.........................44
Table 4.20: Summary output of regression analysis conducted for hypothesis 3.........................45
Table 4.21: ANOVA table of regression analysis conducted for hypothesis 3.............................46
Table 4.22: Coefficient table of regression analysis conducted for hypothesis 3.........................46

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Chapter 1: Introduction
1.1 Introduction
The research report is based on “Impact of outsourcing web development projects on
business performance”. The business functions are growing increasingly complex by means of
globalization, competition as well as technology at rapid pace. Husted and de Sousa-Filho (2017)
noted that handling of aspects of the business operations is difficult for organization to view the
suppliers as the cooperative partners. Bhardwaj and Rana (2015) indicated that outsourcing is
shifted function either in whole from main organization towards the third party. Outsourcing is
contractual relationship among external vendor as well as enterprise in which the vendors are
assumed responsibility for more of the enterprise business functions. Outsourcing of business
operations are fallen under three categories such as increase in revenue, improvement
capabilities and reduction of cost.
1.2 Background of the project
1.3 Research aim and objectives
The aim of this report is to analyze the impact of outsourcing web development on the
business performance. Following are the objectives such as:
 To determine the extent of outsourcing into business performance in web
development projects
 To determine relationship between outsourcing and business performance into
web development projects
 To determine the factors affect implementation of outsourcing
1.4 Research question
What is the impact of outsourcing web development projects on business performance?
1.5 Purpose of the research
The purpose of this study is to understand specific measures on the dimensions of
organizational performance as well as interrelationships to understand relationships among

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various organizational actions. The organizational performance is encompassed of three areas
such as financial, shareholder return performance as well as product market.
1.6 Overview of the research report
The researcher has being completed a partition of the research topics such that the topic is
emphasized in comprehensive manner.
Introduction: The particulars of selected research topic are labelled so that the reader can
comprehend subject of this research topic. In this particular chapter, concept of outsourcing web
development projects is described. Further the investigation aim as well as objectives are
specified which helps in improved understanding of the selected research topic.
Literature review: In this section, models as well as ideas helps researcher to understand
selected research topic and areas of study. With help of the literature sources, the researcher tried
to evaluate the concepts of outsourcing in standardized manner. The critical perspective of this
study helps to observe the pros as well as cons into particular topic.
Research methodology: The research methods help in gaining data collection concerned
on the research topic is also mentioned. The research methodology helps to guide path which can
principal to improved study of selected topic besides aid to gather detailed concepts related to
this research study. Choices of the researcher techniques are being monitored by application of
appropriate justifications so that chosen methods are appropriate.
Results and analysis: Based on collecting of data as well as information, the researcher is
opted to analyze sources such that proper results are generated in apprehension to the selected
research topic. Analyzing of impact of outsourcing web development projects on business
performance are analyzed in this particular chapter which helps the researcher to better
understand of topic. This chapter helps to understand of techniques as well as methods based on
participant’s responses.
Conclusion and recommendations: This chapter provides detailed overview of the
selected research topic which comprise of results of the research subject. Based on the research
objectives, the scholar tried to regulate the accomplishment level of this topic.

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Chapter 2: Literature Review
2.1 Introduction
The study is explored to involve into web application development into the outsourcing
projects and find out the potential challenges. The literature study is included of overview of IT
sourcing, history as well as advantages, disadvantages. It is also covered of issues related to
outsourcing web development projects. Chatterjee (2017) suggested that the performance of
organization is comprised of actual output and results of organization as measured to the
intended outputs. Outsourcing is an effective tool into web development projects as it helps to
improve of time control as it reduces complexity into operations by transfer of the business
activities to third party organization. The organizational performance is encompassed of three
areas of outcomes of firm such as financial performance, product market performance in addition
to shareholder return. The study is focused on impacts of outsourcing on the organizational
performance as well as challenges into implementation of outsourcing (Golini, Kalchschmidt and
Landoni 2015). This particular chapter is provided of research gaps identified furthermore
comprehensive conceptual framework.
2.2 Advantages of outsourcing in web development projects
Outsourcing from the outside vendors are helping to produce of goods as well as services
produced in-house that continues to rise. Carrillo, Druehl and Hsuan (2015) stated that
businesses are outsourced for various reasons such as they are required to reduce cost to become
competitive in IT marketplace. The business can also improve quality in addition to speed of
software requirements and development in IT projects. Hair Jr et al. (2015) concluded that
outsourcing begins to offer of greater value than before. It allows the business firms to
concentrate on resources on core businesses. Most outsourced business functions are included of
information technology as well as human resources (Gurung and Prater 2017). The justification
for outsourcing is economic. The business organizations determined that they can able to prepare
business inexpensively by employed with the outsiders than to rely on interior workforces.
Outsourcing started with the manufacturing sector besides it is constant into IT and service sector
as consequence to underlying position to software goods as well as facilities (Handley and Angst
2015). It becomes importance into IT sector as it has ability to reduce cost, add of business

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values and impact on the financial performance. Earlier studies are showed that outsourcing is
increasing of trends. There are some of the reasons due to which the companies are decided to
outsource such as:
Cutting of capital costs: At the time of setting of office companies, there is required to
invest in equipments such as servers and software. Outsourcing is helped to reduce initial cost as
well as have information system (Gurung and Prater 2017).
Continuous operation: Finishing of the projects on time is considered as competitive
advantage for IT companies. Having offshore vendors with significant time differences for the IT
companies mean there is continuous operations (Liu and Yuliani 2016). There is a huge benefits
from time differences and follow the 24*7 services.
Cheap labor costs: There is time required for the company to recruit IT personnel as well
as provide of training. It is estimated that IT professionals those are able to save around 40% of
expenses into operations in case of company which is based in US (Handley and Angst 2015).
Due to outsourcing of web development projects, the cost savings is ranged from 15-40%.
Reduction of completion time of project: Demands of IT industry is changing. It is
required for the companies to become flexible and quick to adapt of changes. When a company
is chosen to outsource then it is able to tap the workers as well as professionals those have
required know how of changing technology, providing the companies advantages over the
training of personnel and cut down the completion time of project (Hodge 2018).
2.3 Risks into IT outsourcing
Most of the companies are discovered that the cost savings become less than the vendors
which are promised. The companies are found that their savings are dropped after two years.
Nicholson, Babin and Briggs (2017) stated that when propriety technology becomes an issue,
then there is a big problems of outsourcing which caused of security concerns. The companies
are protective to the customer’s data as well as relationships that they think about some of the
functions such as customer services towards outside sources. Carrillo, Druehl and Hsuan (2015)
analyzed that outsourcing is not delivered properly all the time. The managers are prepared to
outsource and the company thought that outsourcing is not able to meet with their expectations.
The cost savings are not satisfied to the customers and the result is that outsourcing becomes a

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problem and have potential to solve it (Liu and Wang 2014). In some of the cases, outsourcing
reduces ability of company to respond to market, and it slows efforts to bring of new products to
market. The suppliers is failed to bring and provided of quality services which affect the
reputation of company with the customers. Husted and de Sousa-Filho (2017) argued that on one
hand there are benefits of IT outsourcing while it comes with various risks. Following are the
outsourcing risks which are analyzed as follows:
Loss of control: As the companies are outsourcing the IT services from third party,
therefore various confidential data are handled by the vendor and service provider (Liang et al.
2016). In these cases, the company loses the control as well privacy over the data to analyze of
outsourcing services.
Privacy and security: The companies are requested to outsource of IT functions from the
foreign partners seem to be vulnerable regards loss of privacy. As there is various information
technology which works with data as well as privacy, then there is possibility of leakage of
confidential data for the IT companies (Liu and Wang 2014). It is required while making of
agreement with the vendors, and then the issues are related to privacy as well as security.
Loss of IT expertise: When the company is decided to outsource of its IT functions from
the third party company, then the IT staffs are required in less numbers. The staffs can able to
understand how the business is operated with extra cost and companies decided to reduce the
operating cost (Palinkas et al. 2015). Expertise IT experts are required to be selected in this case.
2.4 Web development projects and outsourcing issues
Turban et al. (2015) stated that dependence on the web is increased on regular basis.
Systems as well as applications are built from the web, quality as well as reliability. In modern
day, handling of web development project is complex. It comes from visual design, user
interface design and it is required of planning, designing, testing as well as quality checks (Moon
et al. 2016). There are some of the issues which are raised due to outsource of web development
projects such as:
Strategic issues: The common issues related to outsourcing are resources, costs, tapping
of expertise and time factors. It accesses into the company what the expertise are lacked. After
determining of objectives related to outsourcing, the company can able to determine specific sets

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of skills which are required to outsource (Narayanan, Narasimhan and Schoenherr 2015). The
company has to choose of right service provider based on their skills as well as relationship
determine beforehand. There are specific set of skills which are required to outsource, which
determines that the company establishes kind of relationship with the vendor. It is required for
the company to determine dependent they will be on the vendor (Karimi and Walter 2016). The
company interviews the service provider as well as employees before they come to an
agreement. Both location as well as size of provider is playing an important part.
Tactical issues: The Client Company as well as vendor determines responsibilities. They
define the team, responsibilities, as well as process to support entire project work. It is advised to
act as liaison among the parties to avoid of miscommunications. After determine the
responsibilities, it is required for the companies to decide upon the project processes (Saebi and
Foss 2015). When working with team into various places into various cultures, there are
coordination problems, but it is accepted that the teams at both ends have various development
practices.
2.5 Theoretical literature review
Handley and Angst (2015) stated that major discussions into strategy are concerned about
the causes of organizational performance. Academics from numerous backgrounds are intensive
to explain organizational routine in addition identification of sources of inter-firm presentation
differences. Golini, Kalchschmidt and Landoni (2015) argued that industry structure is
fundamental cause to presentation of firm as well as content that the structural features into the
industry result competitive situation of the business units into particular business. The
organizations are used of outsourcing for managing their plan of actions to hire a consultant as
well as contractor for the business activities. Moon et al. (2016) identified that there are two
methods of outsourcing such as incomplete and complete method of outsourcing. The
organizations can subcontract part of their commercial activities but it is thinkable to outsource
each corporate process into the organization. When the group is outsourcing the activities, there
is focus on retaining of core activities and allow the organizations to handle of non-core
activities. Outsourcing is involved specialization of the project activities in which outsourcing
organization has competitive advantage to handle of organizational activities. Husted and de
Sousa-Filho (2017) noticed that outsourcing is involved with specialization of the activities

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where there is competitive advantage of outsourcing. Gurung and Prater (2017) categorized
outsourcing as two methods such as outsourcing activities or hire of manpower from companies
and other method is execution of company’s activities.
2.5.1 Strategic evaluation and outsourcing performance
The companies are required to analyze the disadvantages as well as long term
implications of the exchange before going throughout the sourcing model. Liu and Wang (2014)
discussed that approaches as well as resources are associated with the means of competitive
edge, core competencies which are understandable by the business organizations. The
organizations are adopted of specific path for the competence developments. Hair Jr et al. (2015)
analyzed that outsourcing is being associated by means of removal as well as transfer of the
human in addition to the physical resources. The activities are to be taken for influencing path
for the means of competence developments. The strategic issues which are caused by means of
the outsourcing decisions are capability attribution, violations of the intellectual properties which
are considered by the firms and possible measures are to be taken to prevent from the issues.
There are relationship among the assessment of strategic implications for outsourcing business
strategies. Chatterjee (2017) argued that when the business firms are not carried out of the
assessments, then they are not developed effective as well as proper marketing strategies. The
result is that it may cause competitive edge into the market.
2.5.2 Contractual completeness and outsourcing performance
Hsiao et al. (2017) stated that there are important roles for the contract to evaluate
outsourcing performance which consists of extensive theoretical supports. The organizations
those are adopted of outsourcing to make improvement into the business performance are
recommended to examine results and its possible effects to incomplete contracts along with
importance with regards to create of contracts for gaining objectives at service levels. Turban et
al. (2015) discussed that a contract is resulted to reduce probability for the opportunistic
characterizes as well as costly negotiations. Apart from all this, there are lack of
predetermination for the required facets which are related to exchange that cause increase of
potential for the unexpected behaviors that leads to costly. Carmel, Lacity and Doty (2016)
argued that outsourcing performance has higher influencing by more of completed contracts. The
positive outcomes are being resulted from risks in addition to uncertainty reduction that are from

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the detailed descriptions of the obligations along with procedures from enhancements into inter-
firm resources efficiency due to contractual coordination provision. Outsourcing guarantees for
efficiency of business with an expansion of center exercises that prompts enhance execution
cycle speed. Park and Lee (2014) stated that outsourcing is a compelling instrument into web
advancement extends as it enhances of time control as it decreases intricacy into tasks by
exchange of the business exercises to outsider association. Second effect of the outsourcing for
the organization is change of business adaptability. Adaptable tasks are indicated to capacity of
organization to react to the circumstances like unusual occasions and unforeseen solicitations of
the clients. According to Handley and Angst (2015), outsourcing is an expansion level of the
generation adaptability for the organization, when the organization is expected of assets. There is
an expansion of execution cycle speed and decrease of cost which make of adaptability.
2.5.3 Relationship management and outsourcing performance
Shenhar et al. (2016) argued that performance of firm is being influenced as well as
achieved by development along with enhancements of the relationship among buyer and
supplier. Kvedaraviciene and Boguslauskas (2015) founded that relationship management should
influence the performance of outsourcing which is based on relational perspectives for the
business firms. The theoretical foundation makes an arguments that there is enhancements as
well as maintenance for the network which makes a better relationships to gain of cooperative
relations with the suppliers to gain of competitive advantage for the business firm. According to
Carrillo, Druehl and Hsuan (2015), there is generation of interpersonal rents which are being
distinct as super normal profit produced into argument relationship that are being produced by
the firm into isolations besides created throughout joint contributions of alliance partners. Cao
and Lumineau (2015) stated that information sharing is being increased by reduction of
opportunistic behavior due to social capitals. On other hand, He et al. (2014) argued that learning
are improved by the collaborative relations. Supply chain of the literature review is included of
empirical evidences which support hypothesis for the cooperative relations management
practices result into superior exchange of business performance.
2.6 Outsourcing practices
Into this literature study, various types of outsourcing are identified. Liu and Wang
(2014) mentioned that outsourcing of business activities are classified into three categories such

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as first category which is required of highly skilled expertise like accounting and financial
activities. Second category is comprised of extremely repetitive commercial tasks such as
clerical responsibilities, human resources, sales, and marketing. Final category is outsourcing of
extremely specific business functions such as information technology, project management,
customer support and building. Karimi and Walter (2016) stated that it is considered as largest
areas of outsourcing which is involved with right skills set from the professionals which adapt to
change needs of company. ICT outsourcing is carried based on constituent of the facilities scope
which is subcontracted and duties are devoted to outsource of contract. Palinkas et al. (2015)
discussed that ICT outsourcing is related with cutting of costs, initiation of new business projects
besides improvement over organizational efficiency. The literature also highlighted the risks
related with implementation of ICT outsourcing projects to identify the information security and
privacy risks. Most of the organizations are required to adopt of outsourcing to make some sort
of improvements into the financial and operational performance that are recommended to
scrutinize results. The outsourcing contracts are required to create for gaining objectives at
service levels. Turban et al. (2015) discussed that a contract is resulted to reduce probability for
the resourceful characterizes as well as expensive negotiations. Narayanan, Narasimhan and
Schoenherr (2015) stated that vulnerabilities are referred to absence and weakness of safeguard
into asset which makes threat potential and costly, more like to be occurred and like to occur
frequently into ICT outsourcing. Palinkas et al. (2015) stated that managing of the risks are one
of the critical factors. Saebi and Foss (2015) agreed that it is required to perform risk
management through the stages of outsourcing. The first step into risk management program is
identification of risks and production of risks which minimize the ITO from delivering on time.
2.7 Impacts on the business performance due to outsourcing
The outsourcing motives are being identified and root of the outsourcing motivates which
are argued. The outsourcing motivates are being categorized into financial as well as operational
segments. Outsourcing provides a huge impact on the business performance based on some of
the following factors such as:
Financial performance: Liu and Yuliani (2016) stated that outsourcing is achieved of
positive impacts on financial performance throughout the reduction of cost. Nicholson, Babin
and Briggs (2017) argued that outsourcing for reduction of the cost objectives are proved as first

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priorities regards to the financial motives. The previous research is based on the outsourcing
practices which are identified on influenced sectors where there is reduction of cost is occurred
like lowering the locational cost, technological cost. The key areas for the reduction of cost are
identified as saving for the labor cost, lower the unit cost by supplier tasks at low cost. The
organization are tried to achieve of lower unit cost by specialization for the works and
equipment’s. It is achieved to get of better financial performance of business firm (Pekkola,
Saunila and Rantanen 2016). Outsourcing is reduced of the unit cost and profit that are being
improved. The cost reduction approaches help the business firm to determine the in-house cost
for making comparison with the cost of suppliers. Reduction of cost is achieved when sum of the
cost of suppliers are included of overhead, transactional cost as well as deliver cost that cost of
the in-house productions. Second impact of the financial performance is convert of fixed cost
into variable cost. Ko (2014) indicated that the companies are consisted of higher investment on
the equipment’s, outsourcing is used as a tool for conversion of fixed into variable costs. Fixed to
variable cost is provided impact on return on the assets as well as improvement over the net
profit. Silva et al. (2015) analyzed that outsourcing is required of machinery activities which
help the business to reduce the cost for extra investments on the equipment.
Operational performance: Khan and Khan (2017) discussed that outsourcing has huge
constructive effect on the operational presentation of the business firm. The firms are set of
operational motives as core functions for their outsourcing. Gangwar, Date and Ramaswamy
(2015) argued that financial motives are short term oriented, while the operational motives are
benefited for the companies into long run. There is operational impact from the outsourced
manufacturing that is being described as increase into performance cycle speed. According to
Fawkes (2017), outsourcing ensures for productivity of business with an increase of core
activities that leads to improve performance cycle speed. Outsourcing is an effective tool into
web development projects as it helps to improve of time control as it reduces complexity into
operations by transfer of the business activities to third party organization. Second impact of the
outsourcing for the company is improvement of business flexibility. Flexible operations are
referred to ability of company to respond to the situations like unusual events and unexpected
requests of the customers (Unhelkar 2016). Outsourcing is an increase level of the production
flexibility for the company, when the company is required of resources. There is an increase of
performance cycle speed and reduction of cost which create of flexibility.

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2.8 Relationship between outsourcing and business performance into web
development projects
Sala, Landoni and Verganti (2016) discussed that outsourcing of the web development
projects are a critical topic. There is a relationship between outsourcing in addition business
performance into web development projects based on some of the factors such as organizational
productivity, quality and competitive advantage. The purposed of those factors are providing of
complete opinion of the financial features of web development projects at time of outsourcing.
Organizational productivity: Jordan (2015) observed that outsourcing arrangements
assignment of outsourcing firms’ assets to the vendor which can translate of fixed costs as well
as operating expenses to variable charges. Outsourcing helps to reduce fixed cost, human
expenses and overhead costs throughout the contract. Therefore, outsourcing improves of
organization’s productivity. According to Nicholson, Babin and Briggs (2017), outsourcing does
impact on the cost efficiency of organizational firms. Pekkola, Saunila and Rantanen (2016)
argued that insufficient evidence are concluded that outsourcing business organization obtains of
productivity growth among four quarter period. Various studies seek to explain that there is
relationship among the organizational productivity as well as outsourcing. Carmel, Lacity and
Doty (2016) found a optimistic suggestion among degree of outsourcing as well as efficiency.
There is cost reduction because of productivity in-house service functions as well as assume of
outsource actions when outdoor providers are provided of better comparable services.
Organizational productivity metrics represented of ratios of both inputs as well as outputs.
Output is being dignified throughout the total revenue in addition sales while inputs are
throughout number of workers in addition total assets for generate of output.
Quality: The organizational performance is based on better quality of goods and services
provided to the customers. Pekkola, Saunila and Rantanen (2016) discussed that quality is degree
of appropriateness of relationship for fulfilling requirements of the customers those are
associated with relationship. There is positive relationship among quality as well as outsourcing
which is focused on meeting with customer’s expectations and needs. Quality is based on how a
vendor is delivered of products and services to the client matching their expectations. Liu and
Yuliani (2016) argued among all this, finding of right vendor is also required and development of
contract are required for the organization to outsource of the initiatives. There is higher concern

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to control relief due to day-to-day business operations. According to Liu and Wang (2014), it is
required to consider elements of outsourcing contract that help to avoid of risks which are raised
due to failure of outsourcing. Throughout entire process of outsourcing, dependent on the buyer
as well as vendor firms are required to relate with one another. Palinkas et al. (2015) argued that
when right vendor is selected from beginning, then there is associated of business benefits with
effective outsourcing of relations.
Competitive advantage: There is positive relationship between outsourcing as well as
competitive advantage. Operational decisions are taken to make decisions regarding supervision
as well as guidance required for control as well as consistency into organizational requirements.
Carmel, Lacity and Doty (2016) analyzed that proper actions are mandatory from the exterior
supplier. Finally, organizational decisions are taken to link with the marketing strategy. It creates
of conflicts as well as losses of morale with organization. Therefore, proper organizational
decisions can improve the structure of cost along with profitability. It helps to improve entire
operational effectiveness. The outsourcing is being related by means of elimination as well as
transmission of the human in adding to the physical resources. The activities are to be occupied
for manipulating path for the means of capability developments.
The decision making process is to be generated of proper information for making of
business circumstance for external supplier with financial values for the external suppliers. It
creates of organizational framework to brief potential suppliers, shows how the parties can able
to work together for maximization of business values. It is not a ownership of company of
capabilities that can matter but rather have ability to control as well as make of critical abilities.
Kvedaraviciene and Boguslauskas (2015) analyzed value chain which can underpin the decisions
regarding outsourcing. Saebi and Foss (2015) viewed that group should be focused on areas
where it can add worth to gain of brand reputation, position and innovation. The result is that
outsourcing is growing in various business areas. Narayanan, Narasimhan and Schoenherr (2015)
introduced the variables which are helping to make of proper outsourcing decision such as
credibility, capability as well as cost and mainly those decisions are taken from the external
agencies. Contract conditions are difficult for the organization to outsource since it is required of
sourcing from the external parties which is not allowed. Gangwar, Date and Ramaswamy (2015)
discussed that initial evaluation are allowed for detailed evaluation to outsource of the decisions

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which are to be made. Saebi and Foss (2015) called to use of outsourcing opportunity matrix
which helps the business firm to know whether to outsource considered by some of variables like
cost per transaction as well as ability of firm to perform of business functions. When the business
firm is completed with all possible analysis, then at last it is found to satisfy with conclusions to
make final decisions of outsourcing.
2.9 Factors affect implementation of outsourcing in web development projects
Outsourcing of the web development projects are becoming popular among the market
trend to improve of the business performance. Hsiao et al. (2017) considered that advantages of
outsourcing is included of savings of cost, effective processes as well as accurate business
reporting. Apart from all this, outsourcing is also gained of competitive advantage by allowing of
the firm to be focused on core competencies. Throughout entire process of outsourcing,
dependent on the buyer as well as vendor firms are required to relate with one another. Small
businesses are mainly looking for outsourcing of the financial and accounting functions to
improve the business performance (Silva et al. 2015). Following are the factors which are
considered to have affect the business performance due to outsourcing of web development
projects such as:
Pricing: When entering into contract with the service provider, it is required to make sure
that the price of the services are to be paid. The price of outsourcing is not be to so high that
there is savings of cost, improvement into the business processes and return on investments that
seem to be justified with the price. Handley and Angst (2015) stated that the price should not be
too low as the service providers are not provide best when the pay is lower. There are two types
of pricing which are used such as full time employee pricing model as well as transactional based
pricing model. Full time employee model is where the service providers are paid based on time
and the materials are invested by the service providers. Based on the resource level, the prices
are to be fixed. According to Pekkola, Saunila and Rantanen (2016), transaction pricing model is
such a pricing method which is based on the total number of transactions which are performed
from side of service providers. Sala, Landoni and Verganti (2016) concluded that when pricing is
right, then it is expected to capitalize of return on investments.
Method: The way to outsource plays a key role in ensure of business success. It is
required to choose of outsourcing method based on the organizational structure as well as

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business requirements. When there is outsourcing of financial and accounting functions, then it is
required to outsource of some of key areas such as accounts receivables as well as procurement
processes. Nicholson, Babin and Briggs (2017) asked that when there is savings of cost and
increasing into core competencies, then why there is required of outsourcing. When there is
selection of right method, then there is higher cost savings and there is proper streamline of the
processes.
Location: Nearshoring is the best solution towards mitigate of the outsourcing risks but
there is missing of cost advantages. Fawkes (2017) stated that it is required to choose of right
service provider from right location. Labor pools are required to be available at reasonable costs.
The factors based on which the location is selected such as logistics and transportations, training
levels, cost for training, inventory costs and cost for set up. Therefore, choosing of right location
helps to achieve of best cost savings as well as quicker processes.
Customization: Outsourcing solutions are required to customize to meet with the
business requirements, rules as well as regulations of business organization. Gangwar, Date and
Ramaswamy (2015) analyzed that customization is required to build into the outsourcing
strategies and plan the deals to become succeed. Liu and Wang (2014) argued that the service
providers ensure that technology, personnel as well as plans are relevant to the firm. Flexibility is
required to build into outsourcing plan such that there is rapid changes into the business
performance.
Security: Liu and Yuliani (2016) concluded that security is most important factor which
is required to be considered. The service providers should have right security at place when there
is outsourcing of sensitive information so that no outsiders can able to access it. Data
manipulation as well as data leakage are at big risk at case of outsourcing of web development
projects. It is mitigated by making sure that the service providers are conducted of regular audits
of the security system and ensuring of firewall that should be remain updated. Carmel, Lacity
and Doty (2016) analyzed that data centers are required to be secured against the data hacks. It is
also ensured that security features are to be explained as well as detailed into agreements with
the service providers.

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Returns: The business firms are outsourced to save of the cost. Narayanan, Narasimhan
and Schoenherr (2015) stated that savings of cost is not considered as primary goal to outsource
as it is seen to be certain outcome of outsourcings. Saebi and Foss (2015) discussed that cost
benefit analysis is done on daily basis so that feedback is shared with the service providers.
Efforts are to be improved as well as processes are smother, less consume of times and it is also
effective. Factors which are considered in this returns are improvement over the operating costs,
enhancement in time to delivery as well as progress to meet with compliances issues which can
able to measure returns from means of outsourcing. When there is measurement of retunes, then
there is implementation of business processes which become better over time.
From the above discussions, following are the hypothesis which are proposed for this
particular research study:
Hypothesis 1: There is significant relationship between business performance and opinion about
the features of outsourcing.
Hypothesis 2: There is significant relationship between business performance and importance of
strategic evaluation.
Hypothesis 3: There is significant relationship between business performance and views on
importance of relational commitments.

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Chapter 3: Proposed Methodology
3.1 Introduction
This particular chapter is addressing collection of data as well as procedures which are
used for conducting the investigation and addressing the research questions in addition to
triangulate collected data from the literature review. There are various methods of research
approaches as well as concepts which are used to make sure that correct methods are used to
understand selected research topic. The research related theories as well as concepts are adopted
into the methodology which help to better and deeper understand of selected topic. The
researcher also tried to apply of detailed process which help to better investigation of the impact
of outsourcing on business performance.
3.2 Research philosophy
In the research methodology, the research philosophy assistances to determine proper
way to analyze selected research topic. Mackey and Gass (2015) discussed that it helps to
explain of assumptions which are taken to conduct a study. There are two types of research
philosophy such as positivism and interpretivism. Positivism is subject to help into application of
logic and analyze of hidden facts related to selected research topic. It is tried to reject of
metaphysics such that detailed observations as well as knowledge is being enabled.
Interpretivism is supported concept related to complex structure which is involved into social
world of the business related activities.
In this particular study, in order to evaluate significant factors impact the outsourcing into
the business performance with different project into the IT firm, the researcher is selected of
positivism as the research philosophy. Positivism allowed the researcher to reveal of hidden data
which are related to the outsourcing process into Singapore’s IT industries. Due to limited time,
other research philosophies are not used and those are eliminated from considerations. Selected
method is restricted of activities of study for the data interpretation.
3.3 Research approach
In this particular section, different existing research approaches are being used to select
suitable approach for this research study. There are two types of research approach such as

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deductive as well as inductive approach. Deductive approach is worked from wide topic to
particular topic which aimed to test existing theory and it is required to provide mentioned
hypothesis for proving the research assumptions. This particular approach enabled the researcher
to resolve issues by collection of different types of information as well as data to confirm along
with reject the hypothesis. It started to think about existing theory about selected topic then there
is down of specific hypothesis to test. It is narrowed down where the observations are to be
collected for addressing hypothesis which end to test hypothesis (Lewis 2015). Deductive
approach is suited into scientific research that is required of proper hypothesis testing as well as
explanations and its descriptions. Glesne (2015) discussed that disadvantage of this approach is
inflexibility for considering holistic alternative which influences into the research problem
arrived to narrow down the conclusion.
Inductive approach is considered to be more flexible as well as open ended in nature as
there is no such existing theory for collecting of data as well as information. Taylor, Bogdan and
DeVault (2015) stated that inductive approach is provided the researcher with an argument
required to observe the data as well as fact to test the hypothesis as well as define the theory
from the research problems. This particular approach is worked from the observations to broader
generalization where there is formulation of hypothesis then it is explored to arrive of conclusion
on selected research topic. This particular approach is emphasized to attain qualitative
understanding of nature related to research problem. It is allowed the theory to develop as well as
provide considerations to opinions and concerns related to people in this particular study.
3.4 Research design
According to Flick (2015), research design is helped to develop required framework
required to collect as well as analyze of data. Use of proper research design helps to reveal of
pattern as well as data sources required to complete the study. The data collection process
besides analysis methods are require to conduct the study in detailed manner. There is also
existed of three types of research design such as Explanatory, Exploratory and Descriptive.
Exploratory design is allowed the researcher to define needed data to conduct the study.
Explanatory design is aimed to define of incidents those are occurred respect to time as well as
impact. Descriptive design is provided of description of events those are occurred while
accounted for the research timeline along with impact of selected topic.

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As this particular research study is cross sectional, therefore explanatory research design
is best suited with selected research topic. Descriptive design is selected as it is based on
evaluate of key factors impact outsourcing in the IT firm and its business performance. This
research design is suited as the researcher is not able to describe of processes followed into the
outsourcing process into the IT firms.
3.5 Data collection and analysis
While conducting a study in selected research, the data is being accounted as significant
information required for this study. Useful information as well as data are provided of insight to
the undertaken topic in comprehensive manner. According to Ledford and Gast (2018),
application of proper as well as detailed information are relevant to this particular study which
assisted to deliver of accuracy of data analysis along with maintaining of standard for this study.
3.5.1 Data collection methods
Brinkmann (2014) stated that identification of proper data collection methods are crucial
to conduct the data analysis along with interpretation of those data. Excavation of proper data
sources into the study provides of proper as well as sensitive information which is relevant to the
study. Based on the data collection methods, there are two types of data methods such as primary
besides secondary data collection methods. Smith (2015) defined primary data method as
collection of first time throughout the study. The primary data are raw data which helps to cater
as per research needs. The raw data provides of detailed insight information related to selected
research topic. The raw data are used as the research method which is required of proper
validation of data sources in terms of validity as well as reliability. Secondary data ate those
which are collected as well as gathered by other group of people.
In this particular study, primary data collection method is used which helps to identify of
impact of outsourcing in web development projects for business performance. The data are
collected through use of survey and online questionnaire. A set of questions are prepared based
on selected research topic. There is acceptance of impact of outsourcing at Singapore’s IT
industry. In order to collect of information, the researcher evaluated of feedback from the
respondents and the questions are considered to extract of sensitive information based on
outsourcing process in web development projects.

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3.5.2 Data analysis methods
In this particular study, the researcher is used of quantitative as well as qualitative data
analysis to arrive at the research findings. Silverman (2016) recognized that there is limitations
of one research method that is compensated by strength of other methods. Panneerselvam (2014)
pointed out that there is combination of both qualitative as well as quantitative method which is
good for mixed design to get reliable research findings. The researcher is opted to get qualitative
data from the employees of Singapore’s different IT industry through use of survey questionnaire
method. This data analysis method is used to triangulate primary research for adding of
evidences to the literature study. According to Mackey and Gass (2015), there is combination of
deductive as well as inductive method of the research. Quantitative data are being obtained from
the questionnaire in form of graphs as well as charts.
In this particular study, quantitative data analysis is being used where the researcher has
taken employees from various IT industry and takes their responses through method of online
survey and questionnaire. The result of this data analysis method is to evaluate engagement of
the employees to provide their feedback on outsourcing of web development projects. This
particular method allowed the researcher to obtain of numerical data that is interpreted to display
into graphical format which display the trends as well as triangulations.
3.6 Population and sample
In this research study, the population is number of people those are directly as well as
indirectly involved into the research processes. The employees of various IT industry of
Singapore those are used of outsourcing for their web development projects are considered as
population of this study. Taylor, Bogdan and DeVault (2015) discussed that sample is considered
to study impact of outsourcing into the web development projects on business performance. The
employees of IT industry are taken where the survey is being performed reflected impression of
them based on 1 = Strongly Disagree, 2= Disagree, 3=Neutral, 4=Agree and 5=Strongly Agree.
In order to conduct quantitative research techniques, 50 employees are considered and interacted
with help of the online questionnaire forms. Therefore, the sample size of the study is 50.

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3.7 Ethical considerations
Conducting of the ethical research is par with human rights acted that is specific to the
right to esteem for the correspondence. The respondents those are provided their responses based
on provided survey questionnaire are provided options to reveal and right to answer and not to
answer in whole as well as part the questions. Right not to answer to the survey is based on their
opinions as well as thoughts. As the research is conducted with collecting of organizational data
and information, therefore it is dealt with strict about confidentiality of those data and it is not
published publicly. The researcher has not put any external influence on pressurizing the
respondents to take part into the survey process of research topic. The respondents with intellect
of voluntary participation are stimulated to contribute in the survey process. Based on those
ethical considerations, the researcher is tried to preserve of research ethics.
3.8 Research limitations
The research study helps to gain of results related to concerned research topic is allowed
to encounter of avoidable as well as non-avoidable within nature. Impact of research limitations
lessened with application of different research methods as well as techniques. There are various
research limitations which are identified as follows:
Time constraint: There are a definite time is allocated for conducting the research study
which provide impact on the outsourcing followed into the IT firm. Due to limitation of time, the
researcher is conducted of cross sectional study which limited the author to conduct of detailed
analysis as well as evaluate of different hidden details related to topic. Due to limitation of time,
the researcher has conducted the primary data collection on one IT industry.
Reliability: Raw data are to be collected from the employees in form of survey which are
required to check for validity as well as reliability. The respondents are based on the organization
while providing of their feedback that impacts the results of this study. In order to collect of data
for analysis, the researcher is used of primary data collection.
Lack of budget: This study is provided with limited budget which restricted the scope as
well as nature of this particular study. With a budget, the researcher has consisted of limited time
to study the nature of the organization and identify the factors impact the outsourcing on
business performance. The researcher has restricted to SPSS analysis due to lack of budget.

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3.9 Research Timeline
Main activities/
stages Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7
Selection of the
Research Topic ·
Develop the layout
of the research ·
Conduct the detailed
literature review · · ·
Form the appropriate
research plan · ·
Collect the primary
data and information · ·
Analysis and
Interpretation of
Data Collection
· ·
Develop the data
findings ·
Conclude the Study ·
Development of
Rough Draft · ·
Submit the final
draft to the
University
· ·
3.10 Summary
Throughout the study, the researcher is able to identify of proper research methods used
to analyze selected research topic. The researcher aligned with the nature of this study and
framed based on available techniques to evaluate it. Proper techniques as well as methods are
used for this research study to provide required standard to develop entire research.

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Chapter 4: Results and analysis
4.1 Introduction
In this particular chapter, the researcher is strained to demonstration of data analysis on
the impact of outsourcing web development projects on business performance. With help of the
quantitative data analysis, the data analysis aids as part of the research process helps to upturn of
quality of information besides also make of proper investigation of the selected research topic.
The researcher is opted to get qualitative data from the employees of Singapore’s different IT
industry through use of survey questionnaire method. This data analysis method is used to
triangulate primary research for adding of evidences to the literature study. The data analysis is
involved with limitations, data manipulation and complexities. There is also process of
crosscheck of data analysis in selected research topic. Based on this chapter, the respondents of
the IT industry provided their feedback and based on it’s the researcher has gained of
information related to the topic and also analyze of findings and validity into process to collect of
data.
4.2 Quantitative analysis
In this current section, the employees of Singapore’s IT industry is measured for
performing the quantitative analysis such that the investigator can able to comprehend the impact
of outsourcing in the organizational performance. The total number of respondents those are
taken for this study are 50 as others are not interested to fill the online survey form, therefore
they are discarded from being sample of this research study.
Section 1: General information
1. Gender
Options No of respondents Total respondents Response percentage
Male 27 50 54%
Female 23 50 46%

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Table 4.1: Gender
Figure 4.1: Gender of respondents
Findings: From the above figure, it is analyzed that 54% of the respondents are male and
46% of them are female. Therefore, both male as well as female is interested in this research
study to provide their feedback on analyzing the impact of outsourcing into the business
performance.
2. Age group
Options No of respondents Total respondents Response
percentage
18-21 years 9 50 18%
22-25 years 20 50 40%
26-29 years 9 50 18%
Above 30 years 12 50 24%

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Table 4.2: Age group of respondents
Figure 4.2: Age group
Findings: From the above figure, it is analyzed that most of the respondents those are
participated into the survey are between the ages of 22-25 years. 18% of the participants are
among 18-21 years and 26-29 years. There are 24% of the participants those are above 30 years.
Therefore, most of the workers those are working and interested into the survey are young.
3. How long have you been working with the IT Industry?
Options No of respondents Total respondents Response percentage
0-5 years 14 50 28%
5-10 years 23 50 46%
11-20 years 10 50 20%
Above 21 years 3 50 6%

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Table 4.3: Years working in IT industry
Figure 4.3: Years working in IT industry
Findings: From the above figure, it is analyzed that 48% of the respondents are working into
the industry are between 5-10 years. 28% are between 0-5 years, 20% are between 11-20 years
and 6% are above 21 years.

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Section 2: Impact of outsourcing web development projects on business performance at
Singapore’s IT industry
1. My company engages in IT outsourcing.
Options No of respondents Total respondents Response percentage
Strongly disagree 2 50 4%
Disagree 5 50 10%
Neutral 9 50 18%
Agee 31 50 62%
Strongly agree 3 50 6%
Table 4.4: Company engages into IT outsourcing
Figure 4.4: Company engages into IT outsourcing
Findings: From the above figure, it is analyzed that 62% of the respondents are agreed that
their IT industry is used of IT sourcing. 18% of them go with neutral, 10% of them go with
disagree and 6% of them go with strongly agree. IT sourcing as well as procurement are faced of
complex decisions and there is an increase of accountability into the challenging environment,
the IT sourcing helps to deliver of measurable results. The industry is used of IT sourcing to
make sure access to right level as well as amount of competence, when required to deliver of IT
services as per requested quality as well as cost. At the time of implementation of strategic

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sourcing, the companies are required to recognize about goods as well as services and also
categorizes how vital the activities become on regular basis.
2. I agree that IT activity impact on cost and revenue of organization?
Options No of respondents Total respondents Response percentage
Strongly disagree 0 50 0%
Disagree 2 50 4%
Neutral 20 50 40%
Agee 26 50 52%
Strongly agree 2 50 4%
Table 4.5: IT activity impact on cost and revenue of organization
Figure 4.5: IT activity impact on cost and revenue of organization
Findings: From the above figure, it is analyzed that 52% of the respondents are agreed
that IT activity impacts on the cost as well as revenue of the organization. 40% are neutral, 4% of
them are disagree and strongly agree. Profit as well as cost for production is affected the business
by having stronger influences on the cash flow, along with entire health of the business model of
IT industry. More revenue the company will generate as well as less it spends, there will be
greater amount of the revenue to have finance day-to-day operations. The product cost are
expenses like materials as well as labor, then the company is incurred of producing of product
that sell to the customers. When there is lower production of cost, there will be higher profit and
the sales revenue will become more. IT activities are ways for the company to generate of

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revenue as well as earns of money. Profit as well as cost of production are considered as integral
parts for the business model.
3. My company’s main reason for outsourcing of web development project is financial
advantages?
Options No of respondents Total respondents Response percentage
Strongly disagree 0 50 0%
Disagree 6 50 12%
Neutral 17 50 34%
Agee 27 50 54%
Strongly agree 0 50 0%
Table 4.6: Reason for outsourcing is financial advantages
Figure 4.6: Reason for outsourcing is financial advantages
Findings: From the above figure, it is analyzed that 54% are agreed with that the
main reason of outsourcing for the company is financial advantages. 34% of the
respondents go for neutral and 12% of them are disagreed with it. Into each of the
business organization, there is an upward trend of the outsourcing. The trend improves
over economy, rise into revenue into the human resources along with finance and
accounting. It provides the companies with proper financial information to support
growth of business at fraction of cost as well as time it is required to build of in-house
financial departments. The companies are prevented to take of decisions with use of

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financial data as the system is not allowed to process of huge pictures. The IT Company
is outsourced of payroll processing as well as accounting. The company is outsourced to
cut their cost. Outsourcing is converted of fixed cost into the variable cost, released of
capital for the investments. Outsider structure of cost along with economy of scale
provides a competitive advantage.
4. I feel that there is a huge effect of cost driven outsourcing on the organizational
performance?
Options No of respondents Total respondents Response percentage
Strongly disagree 1 50 2%
Disagree 3 50 6%
Neutral 18 50 36%
Agee 27 50 54%
Strongly agree 1 50 2%
Table 4.7: Effect of cost driven outsourcing on organizational performance
Figure 4.7: Effect of cost driven outsourcing on organizational performance
Findings: From the above figure, it is analyzed that 54% of the respondents are
agreed with that there is huge effect of cost driven outsourcing on the organizational
performance. 36% of them are neutral, 2% of them are strongly disagree, 6% of them are
disagreed and 2% of them are strongly agree. Cost driven leads to improve the
organizational performance by reduction of cost, risks while increasing of the operational
efficiency both into short as well as long term. Cost driven leads to improve the

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organizational performance by development as well as deliver of value to market faster
than their competitors. It assists the business organization to free up the resources on the
core business that leads to improve the performance of organization. The success of cost
driven is found to be dependent on cost control as well as core competencies.
5. Outsourcing reduces time taken to develop new products?
Options No of respondents Total respondents Response percentage
Strongly disagree 0 50 0%
Disagree 5 50 10%
Neutral 15 50 30%
Agee 29 50 58%
Strongly agree 1 50 2%
Table 4.8: Outsourcing reduces time taken to develop new products
Figure 4.8: Outsourcing reduces time taken to develop new products
Findings: From the above figure, it is analyzed that 58% of the respondents are
agreed that outsourcing reduces time taken to develop of new products. 30% of them are
neutral, 10% of them are disagreed and 2% of them are strongly agree. Outsourcing of
new products are effective as well as economical. The companies are required to focus on
core business activities. The outsider companies are faster when development of new
products as there are dedicated resources to web development projects. It cuts the cost
into the short rem, as well as gets of products into the market faster can able to boost the
profits over longer term. As the organization is growing faster, therefore less time is
spend on maintaining of the existing products. As the company is growing as well as

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adding of products, it is used of engineering resources for sustaining of engineering. It is
therefore limits the time for new product development.
6. Customers are satisfied with the company’s products?
Options No of respondents Total respondents Response percentage
Strongly disagree 0 50 0%
Disagree 2 50 4%
Neutral 22 50 44%
Agee 26 50 52%
Strongly agree 0 50 0%
Table 4.9: Satisfaction of customers with company’s products
Figure 4.9: Satisfaction of customers with company’s products
Findings: From the above table, it is analyzed that there are 52% of the
respondents are agreed that the customers are satisfied with the company’s products. 44%
of them are neutral and 4% of them are disagree. With use of outsourcing process into the
IT industry, there is development of new products and the customers are satisfied with
them all. Outsourcing is such a process which gained of increasing significance as a way
to improve over the corporate process and maintenance of business operations. It is based
on ability to enhance as well as streamline of company related services, while allowed a
focus on the core activities of company. The company is concerned about the customer
satisfaction level due to outsourcing and customer relationships. Outsourcing leads to
customer service delivery as well as user satisfaction. There is required to manage of
relationship with the customers, strategic approach as well as responsible management of

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distributing team are succeed with outsourcing results which satisfy the quality of
products as well as demands of customers.
7. My company is developed of new products and services for maintaining of
competitiveness?
Options No of respondents Total respondents Response percentage
Strongly disagree 1 50 2%
Disagree 1 50 2%
Neutral 18 50 36%
Agee 26 50 52%
Strongly agree 4 50 8%
Table 4.10: Development of new products and services for maintaining of competitiveness
Figure 4.10: Development of new products and services for maintaining of competitiveness
Findings: From the above figure, it is analyzed that 52% of the respondents are
agreed that the company is developed of new products and services for maintaining of
competiveness. 36% of them are neutral, 8% of them are strongly agree and 2% of them
are strongly disagree and disagree both. When the company is improved its competitive
position into the market, they think to develop of new technology, innovative process as
well as adapt of business model. The organizations are increasing and using of
outsourcing to change of the competitive landscape along with reposition of the firms.
Outsourcing helps the company to reduce of cost, grow its revenue and first movers into
the market which leads to achieve of competitive position into the market. There is an

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
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increase of external product development as well as contractors possess. The suppliers
are also build of core competencies into the market. Innovation of new technology due to
outsourcing also leads to increase competitive advantage into the market. The company
becomes cost effective for making of investments which is required on cutting edge of
the countless as well as innovative technologies.
8. Outsourcing innovation to other companies is better and faster for improvement of
business performance?
Options No of respondents Total respondents Response percentage
Strongly disagree 0 50 0%
Disagree 4 50 8%
Neutral 17 50 34%
Agee 29 50 58%
Strongly agree 0 50 0%
Table 4.11: Outsourcing innovation is better and faster for improvement of business
performance
Figure 4.11: Outsourcing innovation is better and faster for improvement of business
performance
Findings: From the above figure, it is analyzed that 58% of the respondents are
agreed that outsourcing innovation to other companies is better and faster for making
improvement of business performance. 34% of them are neutral, as well as 8% of them
are disagree. The benefit of outsourcing shifts from the cost saving towards adding of
business value. The benefit is shifted from operational towards the strategic levels. The

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client company is raised of expectations regards to the potential to make benefits from
innovations delivered from the vendor side. Innovation is taking procedure of new
products in addition services offered to the clients and processes throughout which the
organization develops the product as well as deliver of the services. Outsourcing context
is posed of challenges to achieve of innovation among the client firm as well as vendor. It
is uncertain towards nature of invention anticipated from the vendor as well as
incapability to project of contract by vendor and same time it proposals of recompense
for extra work. The client firm seek towards innovations from outsourcing engagements.
The key drivers of innovation are incomplete resources as well as competences of
organization with the client firm, lack of the talents, managing of numerous risks as well
as reduction of time-to-market.
9. Outsourcing enables your company to concentrate its efforts on building and
expanding its best-in-world competencies?
Options No of respondents Total respondents Response percentage
Strongly disagree 0 50 0%
Disagree 3 50 6%
Neutral 10 50 20%
Agee 36 50 72%
Strongly agree 1 50 2%
Table 4.12: Outsourcing enables to concentrate on efforts to build and expand best world
competencies

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
PERFORMANCE
Figure 4.12: Outsourcing enables to concentrate on efforts to build and expand best world
competencies
Findings: From the above table, it is analyzed that 72% of the respondents are
agreed that outsourcing enables to concentrate on efforts to build and expand its best-in-
world competencies. 20% of them are neutral, 6% of them are disagree and 2% of them
are strongly agree. Outsourcing is required of assessment of current strength as well as
weakness such as core competencies as well as critical skills required for optimization of
business performance. Merger as well as acquisitions into the market are expanded of
range of services along with expertise. There are significant investments are made by the
service providers into IT platforms for expansion of the business intelligence which drive
decisions at each organizational levels. It is also included of artificial intelligence to the
platforms which can replicate of the human analysis as well as critical thinking. Core
competencies are resources as well as strategies advantages of the business included of
combination of knowledge as well as technical abilities. The IT industry should identify
as well as focus on core competencies to establish of the footprint while gaining of
reputation as well as increase of brand recognition. Outsourcing is required for transfer of
the business towards the company whose core competencies are included with transfer of
activities besides functions.

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PERFORMANCE
10. Outsourcing creates flexibility in organizational structure and strategy, creating
competitive edge in Singapore market?
Options No of respondents Total respondents Response percentage
Strongly disagree 0 50 0%
Disagree 4 50 8%
Neutral 12 50 24%
Agee 33 50 66%
Strongly agree 1 50 2%
Table 4.13: Outsourcing creates flexibility in organizational structure and strategy
Figure 4.13: Outsourcing creates flexibility in organizational structure and strategy
Findings: From the above table, it is analyzed that 66% of the respondents are agreed
that outsourcing creates of flexibility in organizational structure and strategy. 24% of them are
neutral, 8% of them are disagree as well as 2% of them are strongly agree. Outsourcing is creates
of a competitive advantage into the Singapore market as it is creates of flexible business services
for the company and the client so that it can able to meet with the organizational requirements.
Flexibility is outsourcing relationship which is required to provide a cost effective services to the
company. The decision makers are considered of competitive advantage when deciding to
outsource and there is also partnership value which is created as well as attributed to the
outsourcing partnership. It is found that there is higher degree of competitive advantage which is
achieved throughout outsourcing. It is found that there is expected cost savings which are
achieved. Partnership value is also required for the competitive advantage as the firm is achieved

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PERFORMANCE
into the marketplace throughout outsourcing as well as working with the partner company. The
company is achieved to evaluate of greater value from relationship with the partner by evaluation
of factors which are related to external as well as competitive environment along with
partnership value.
In order highlight the relationship between the dependent and independent factors
associated with each hypothesis are as follows:
Hypothesis 1: There is significant relationship between business performance and
opinion about the features of outsourcing.
The regression model of the hypothesis can be stated as follows:
Dependent variable of hypothesis = A + B* independent variable of hypothesis
Where, A= Intercept of the Model
And B= Coefficient of “relationship between business performance and opinion about the
features of outsourcing”
The details of the regression analysis conducted on the above mentioned model has here
being presented in the table below:
Table 4.14: Summary output of regression analysis conducted for hypothesis 1
SUMMARY
OUTPUT
Regression Statistics
Multiple R 0.524850222
R Square 0.275467756
Adjusted R Square 0.227165606
Standard Error 0.803741362
Observations 49

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Table 4.15: ANOVA table of regression analysis conducted for hypothesis 1
ANOVA
df SS MS F
Significanc
e F
Regression 3
11.0524
4
3.68414
7
5.70301
2
0.00213589
3
Residual 45
29.0700
1 0.646
Total 48
40.1224
5
Table 4.16: Coefficient table of regression analysis conducted for hypothesis 1
Coefficients
Standard
Error t Stat P-value Lower 95%
Upper
95%
Intercept 0.510178292 0.804118 0.634457 0.528995
-
1.109398256
2.12975
5
4 0.242392904 0.201287 1.204213 0.234803
-
0.163020704
0.64780
7
4 0.458699943 0.196195 2.337978 0.023893 0.063542612
0.85385
7
3 0.176736888 0.168731 1.04745 0.300486
-
0.163103996
0.51657
8
The null and alternative hypothesis associated with hypothesis 1 are as follows:
Null hypothesis (H0): There is no significant relationship between business performance and
opinion about the features of outsourcing.
Alternative hypothesis (H1): There is significant relationship between business performance
and opinion about the features of outsourcing.
An analysis of the findings of the regression method indicates that the value of the
Significant F, for this particular hypothesis, is 0.002135893. In this case the value of the
Significant F, as obtained through regression analysis, is found to be less than 0.05, the null
hypothesis has to be rejected essentially. Now, the value of the Significant F factor for this

45
IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
PERFORMANCE
hypothesis is much less than 0.05: hence the null hypothesize sated in the section above has
to be rejected. Thus, it can be said that it has been proved that the statement “There is significant
relationship between business performance and opinion about the features of outsourcing.” holds
true.
Hypothesis 2: There is significant relationship between business performance and
importance of strategic evaluation.
The details of the regression analysis conducted on the above mentioned model has here
being presented in the table below:
Table 4.17: Summary output of regression analysis conducted for hypothesis 2
SUMMARY OUTPUT
Regression Statistics
Multiple R
0.3685773
7
R Square
0.1358492
8
Adjusted R Square
0.0982775
1
Standard Error
0.6748791
5
Observations 49
Table 4.18: ANOVA table of regression analysis conducted for hypothesis 2
ANOVA
df SS MS F
Significanc
e F
Regression 2 3.293652 1.646826 3.615727 0.034798
Residual 46 20.95125 0.455462
Total 48 24.2449
Table 4.19: Coefficient table of regression analysis conducted for hypothesis 2
Coefficient
s
Standar
d Error t Stat P-value
Lower
95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercept 2.0430182
0.66780
1
3.05932
2
0.00369
3
0.69880
5
3.38723
2
0.69880
5
3.38723
2
4 0.4621242 0.17462 2.64640 0.0111 0.11062 0.81362 0.11062 0.81362

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
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1 3 9 6 2 6 2
4 -0.037678
0.13372
2
-
0.28176
0.77938
8
-
0.30685 0.23149
-
0.30685 0.23149
The null and alternative hypothesis associated with hypothesis 2 are as follows:
Null hypothesis (H0): There is no significant relationship between business performance
and importance of strategic evaluation.
Alternative hypothesis (H1): There is significant relationship between business
performance and importance of strategic evaluation.
An analysis of the findings of the regression method indicates that the value of the
Significant F, for this particular hypothesis, is 0.034798. In this case the value of the Significant
F, as obtained through regression analysis, is found to be less than 0.05, the null hypothesis has
to be rejected essentially. Now, the value of the Significant F factor for this hypothesis is less
than 0.05: hence the null hypothesize sated in the section above has to be rejected. Thus, it can
be said that it has been proved that the statement “There is significant relationship between
business performance and importance of strategic evaluation.” holds true.
Hypothesis 3: There is significant relationship between business performance and views
on importance of relational commitments.
The details of the regression analysis conducted on the above mentioned model has here
being presented in the table below:
Table 4.20: Summary output of regression analysis conducted for hypothesis 3
SUMMARY OUTPUT
Regression Statistics
Multiple R 0.527479
R Square 0.278234
Adjusted R
Square 0.246853
Standard Error 0.563608
Observations 49

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
PERFORMANCE

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
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Table 4.21: ANOVA table of regression analysis conducted for hypothesis 3
ANOVA
df SS MS F
Significanc
e F
Regression 2
5.63282
4
2.81641
2
8.86629
4 0.000553
Residual 46
14.6120
7
0.31765
4
Total 48 20.2449
Table 4.22: Coefficient table of regression analysis conducted for hypothesis 3
Coefficien
ts
Standar
d Error t Stat P-value
Lower
95%
Upper
95%
Lower
95.0%
Upper
95.0%
Intercep
t 1.279737
0.53104
2 2.40986
0.02001
6
0.21080
5
2.34866
9
0.21080
5
2.34866
9
4 0.359235
0.15861
2
2.26486
1
0.02827
7
0.03996
5
0.67850
5
0.03996
5
0.67850
5
4 0.244471
0.14631
4 1.67086 0.10154
-
0.05004
0.53898
7
-
0.05004
0.53898
7
The null and alternative hypothesis associated with hypothesis 3 are as follows:
Null hypothesis (H0): There is no significant relationship between business performance
and views on importance of relational commitments.
Alternative hypothesis (H1): There is significant relationship between business
performance and views on importance of relational commitments.
An analysis of the findings of the regression method indicates that the value of the
Significant F, for this particular hypothesis, is 0.000553. In this case the value of the Significant
F, as obtained through regression analysis, is found to be less than 0.05, the null hypothesis has
to be rejected essentially. Now, the value of the Significant F factor for this hypothesis is less
than 0.05: hence the null hypothesize sated in the section above has to be rejected. Thus, it can
be said that it has been proved that the statement “There is significant relationship between
business performance and views on importance of relational commitments.” holds true.

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4.3 Summary
It is summarized that outsourcing has a relationship with the strategic evaluation of the
business organization, and there are also higher impact of outsourcing of web development
projects on the business performance. . Innovation is taking method of innovative products in
addition services accessible to the clients and processes throughout which the organization
develops the product as well as deliver of the services. Outsourcing helps to cut the cost and
there are higher achievement of sales revenue by the company. The company is achieved of
competitive advantage into the market as the outsider can provide a better customer value as
compared to insider.

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
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Chapter 5: Conclusion
5.1 Conclusion
It is concluded that the price of outsourcing is not be to so high that there is savings of
cost, improvement into the business processes and return on investments that seem to be justified
with the price. The factors based on which the location is selected such as logistics and
transportations, training levels, cost for training, inventory costs as well as the price related to set
up. Outsourcing is considered as vital part for taking of decisions related to business. There are
various factors which lead to play a key role into taking of decisions like quality, cost as well as
other factors.
5.2 Linking with objectives
Objective 1: To determine the extent of outsourcing into business performance in web
development projects
It is concluded that outsourcing helps to make improvement into the business
performance by cutting of business cost, achieve of competitive advantage and providing of
financial advantage into the organization. Outsourcing helps to reduce fixed cost, human
expenses and overhead costs throughout the contract.
Objective 2: To determine relationship between outsourcing and business performance
into web development projects
There is a better relationships to gain of cooperative relations with the suppliers to gain of
competitive advantage for the business firm. Outsourcing is reduced of the unit cost and profit
that are being improved. The cost reduction approaches help the business firm to determine the
in-house cost for making comparison with the cost of suppliers.
Objective 3: To determine the factors affect implementation of outsourcing
The company is dependent on outsourcing which help the business to become productive
as well as successful. The outsourcing companies are not a business without outsource of their
products and services to other countries. Labor cost is considered as major factor which affect

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
PERFORMANCE
the implementation of outsourcing. Throughout outsourcing, the companies have capability to
advance of inexpensive strategies which can influence of their economic positions into
competitive worldwide.
5.3 Recommendations
It is recommended that each of the cloud outsourcing contract should include
undertakings from the cloud service provider to provide of better services to the client company.
It should be required to take decisions of outsourcing based on context of the business strategies.
By alignment with the business strategy, there are proper controls into the contract. The company
is required to intent to grow through aggressive acquisition strategies to ensure of pricing which
takes the planner growth into accountability. Management commitment is critical to success of
the outsourcing transactions. By alignment with the outsourcing decisions towards the strategic
plan, the team becomes committed to project work.
5.4 Further scope of the study
With the outsourcing industry emerged from the worldwide recession, there are
movements which give indication to forthcoming such as the researcher is predicted that the
industry should endure to the short term cost compressions and there should be heaviness on the
service providers to become flexible into the valuing contracts. The company is focused on
increasing of operational efficiency, reduction of back office cost in addition better quality
control in the future.

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Appendix
Survey Questionnaire
Impact of outsourcing web development projects on business performance
The questionnaire is designed to study the impact of outsourcing web development projects on
business performance of Singapore’s IT industry. Your participation is much appreciated and
your answers will be treated confidentially and will be used for academic purpose only.
Section 1: General information
1. Gender
o Male
o Female
2. Age group
o 18-21 years
o 22-25 years
o 26-29 years
o Above 30 years
3. How long have you been working with the IT Industry?
o 0-5 years
o 5-10 years
o 11-20 years
o Above 21 years
Section 2: Impact of outsourcing web development projects on business performance at
Singapore’s IT industry
We would like your impressions about your acceptance of impact of outsourcing at Singapore’s
IT industry. Choose the most suitable answer that reflects your impression knowing that 1=
Strongly Disagree, 2= Disagree, 3=Neutral, 4=Agree and 5=Strongly Agree
Features of outsourcing:
1. My company engages in IT outsourcing.
o Strongly disagree
o Disagree

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
PERFORMANCE
o Neutral
o Agree
o Strongly agree
2. I agree that IT activity impact on cost and revenue of organization?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree
3. My company’s main reason for outsourcing of web development project is financial
advantages?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree
4. I feel that there is a huge effect of cost driven outsourcing on the organizational
performance?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree
Strategic evaluation:
5. Outsourcing reduces time taken to develop new products?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree
6. Customers are satisfied with the company’s products?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree

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IMPACT OF OUTSOURCING WEB DEVELOPMENT PROJECTS ON BUSINESS
PERFORMANCE
7. My company is developed of new products and services for maintaining of
competitiveness?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree
Relational commitments:
8. Outsourcing innovation to other companies is better and faster for improvement of
business performance?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree
9. Outsourcing enables your company to concentrate its efforts on building and expanding
its best-in-world competencies?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree
10. Outsourcing creates flexibility in organizational structure and strategy, creating
competitive edge in Singapore market?
o Strongly disagree
o Disagree
o Neutral
o Agree
o Strongly agree