Evaluating the impact of outsourcing ICT operations at Road Accident Fund

Abstract

The Road Accident Fund (RAF) receives a high number of claims as a result of major road accidents. This required RAF to change its business model to meet consumer demand (claimants) and to enhance the internal processes. This is done through outsourcing services from highly specialized entities. According to Hati̇Poğlu (2015), outsourcing has evolved as a strategic option for attaining organizational goals through cost management and to sustain and maintain competitive advantage. The organization is forced to outsource various service to acquired insufficient skills and knowledge within the company. However, at the end of outsourced services contract, RAF usually remain without the knowledge and skills required to continue with service maintenance.

This study aims to evaluate the impact of outsourcing ICT operations and to evaluate skills sharing between employees during outsourcing. Based on a review of the literature in the benefits of skills transfer during outsourcing, structured interviews were conducted to ICT specialist and junior managers. Participant were selected based on experience of outsourcingand ICT qualification. The analysis of the responses demonstrated that consultants were not willing to share information and, service providers dispatched unskilled consultant. The analysis further indicated that there was lack of management support, inadequate infrastructure to store knowledge and lack of policy enforcement from the management. The results indicate that management does not enforce or develop policies for knowledge sharing during outsourcing. On this basis, it is recommended that the organization must improve good relationship with the service provider and must ensure that there are policies in place which will easily enable knowledge sharing. Further research is needed to develop a model that will monitor a successful knowledge sharing processes. The study is limited to one organisation, and it followed a single case study research strategy. Thus, the findings might have been influenced by the unique characteristics of the organisation, even though the study was based on solid theories. Caution must be taken not to generalise the findings to other organisations with different characteristics