IT Outsourcing Relationships in the Context of Digital Transformation: From Transactional Relationships to Ecosystem Partnerships

Digital Transformation (DT) reshapes the IT function and its ecosystem. This transformation affects multiple domains of the IT function, including IT outsourcing (ITO) and relationships with outsourcing partners. While several studies explored shifts in ITO relationships, there is a lack of systematic understanding of how DT changes the nature of organizations’ ITO relationships. Previously published ITO taxonomies still reflect the dimensions and characteristics of traditional ITO practices. We propose that the DT alters the dimensions and characteristics of ITO. We thus revisit and advance existing taxonomies by employing a systematic literature review of recent ITO studies. Based on this review, we update existing taxonomies’ dimensions and characteristics to reflect the DT-induced change in ITO relationships. The updated taxonomy reveals a shift from transactional relationships to ecosystems of partnerships in ITO. This shift provides directions for future research of ITO relationships and for managing today’s IT service networks.