Minicase 2: Outsourcing Its IT, Kone Is Focusing on Its Core Competencies

1. What were the major drivers of the outsourcing at Kone?
- Kone found out that internal IT processes were insufficient to support the globalization strategy.
- The major drivers of the outsourcing at Kone is Kone realize that it must implement and manage a global-standard IT environment. The company also realized that its business is about escalators and elevators, not IT, so it decided to pursue IT outsourcing.

2. Why did Kone elect to work with several vendors?
- By using two separate vendors promised the best-of-breed approach.
- To ensure high availability environment.
- The system provides management with real-time data on product sales, profitability and backlogs

3. What are some of the risks of this outsourcing?
- Lose some element of control over the people that have been outsourced.
- communication network between Kone and vendors failure.

4. How can Kone control its vendors?
- Kone maintains some IT competencies to allow it to actively manage its outsourcing partners.
- The internal team meets online regularly, and the vendors collaborate and work closely together.

By: Goo Yah Wei