The Effect of Cultural Differences on Trust and Control: A Cross-Cultural Study on Information Technology Outsourcing Relationships

• Applicant: Professor Dr. Christoph Rosenkranz
• Subject Area: Accounting and Finance
• Term: from 2016 to 2019
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 280875528

The outsourcing of information technology (IT) to external vendors promises lower delivery cost while attaining higher delivery quality. Despite these huge prospects, many information technology outsourcing (ITO) engagements still fail, often due to culture-induced issues between the involved client and vendor organizations. Our research project will therefore focus on evaluating the effect of cultural differences between client and vendor organizations on ITO client-vendor relationship quality and ITO success by answering the following general research question: How do cultural differences between client and vendor influence the ITO client-vendor relationship quality? In particular, building upon a pre-defined conceptual model grounded on Social Exchange Theory (SET) and Transaction Cost Theory (TCT) as the theoretical lenses, the project aims at evaluating the relationship between cultural differences on a macro-, meso- and micro-level (e.g., national culture, organizational culture, team culture) and the usage of trust and control mechanisms in ITO client-vendor relationships. Building upon our already conducted prerequisite work (literature review, initial empirical analysis on factors influencing the ITO client-vendor relationship, conceptual model definition), the empirical part of the research project will be conducted jointly with several industry partners and includes the evaluation of different international ITO engagements using a mixed-method research design. The expected result of our study will show the influence of cultural differences on ITO client-vendor relationship quality across diverse contexts in terms of national, organizational as well as team culture which is so far a gap in our knowledge on ITO client-vendor relationships.

• DFG Programme: Research Grants