A survey of outsourcing information technology Services by commercial banks in Kenya

Abstract

The purpose of the study was to investigate the extent to which Commercial Banks in Kenya outsource their information Technology Services. Data collection method employed in the research was personal interview of information Technology managers by use of both open and closed-ended questionnaires. The study revealed that outsourcing was not a new term with Commercial Banks. Some areas of operations had been outsourced from when some particular banks were established, though not to a great extent. The main success factor of the project was adequate knowledge about the benefits of outsourcing IT services. The objectives of the study were to determine the extent of outsourcing IT services by Commercial Banks, the benefits and risks-of outsourcing IT services and thirdly vendor selection criteria. -. The research done revealed that 25commercial banks (which is 73.5%)were not keen on outsourcing their IT functions to a greater extent for their concern on data security as well as exposure of critical customer information. It is evident from the results that the commercial banks were willing to outsourcing IT functions that would not touch on any of the company's data, this included maintenance/repair, application development and website management. The major challenges faced by outsourcing were; lack of innovation in the IT activity being outsourced and loss of control by the bank on the activity being outsourced.