Differences in Contracting: Anchoring Formal and Relational Norms within BPO Governance

摘要

Within IS outsourcing research there is an ongoing discussion whether formal contracts and relational norms function as substitutes or as complements to each other. However, even those deals which are based on relational norms usually comprise a contract as their foundation. We therefore aim at analyzing differences in contracting between both governance modes (i.e. contract-based or based on relational norms) and exploring their impact on outsourcing satisfaction. Based on a survey with 335 Business Process Outsourcing (BPO) deals in the German banking industry we show that clauses on problem resolution are most important in BPO contract design. Furthermore, we find that deals focusing on formal governance put a lot of emphasis on the design of Service Level Agreements (SLAs) whereas deals focusing on relational governance pay special attention to the unambiguousness of outsourcing objectives.