How Digital Transformation Impacts Sourcing: Learnings from an Autonomous Driving Case

Item Type Monograph (Working Paper)
Abstract New digital services and products rely heavily on digital technologies and need to be deployed in an ever-shorter timeframe in response to rapidly changing market demands. To address this challenge, more and more companies apply agile practices to increase speed and flexibility. In consequence, companies review their sourcing strategies to shorten tender duration for large-scale IT initiatives and to increase flexibility in contracting of IT services to cope with the anticipated consequences of digital transformation. This study aims at revealing how the application of agile practices impacts the sourcing and contracting of IT services. As the automotive industry is especially affected by the adoption of new digital technologies, this revelatory case study shows how the German premium car manufacturer CarCo increased agility in the sourcing and contracting of IT services for an autonomous driving development IT platform. Agile practices turned out to be essential in dealing with technological novelty and hurdles, regulatory uncertainty, and frequently changing requirements. Applying agile practices to IT sourcing has two major implications: First, agile practices aim at reducing tender duration, decreasing pre-contractual uncertainty, and therefore increasing speed and flexibility. Second, agile software development changes contract nature as comprehensive requirements are replaced by high-level specifications focusing on business outcomes. We contribute to the extant knowledge on IT sourcing and contracting by providing managerial recommendations on how to increase agility in sourcing and contracting of large-scale IT initiatives.
Authors Gerster, Daniel & Dremel, Christian
Language English
Subjects computer science
information management
HSG Profile Area SoM - Business Innovation
Refereed Yes
Date 2020
Place of Publication IWI Working Paper
Depositing User Prof. Dr. Benjamin van Giffen
Date Deposited 27 Apr 2020 12:01
Last Modified 20 Jul 2022 17:42


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Gerster, Daniel & Dremel, Christian: How Digital Transformation Impacts Sourcing: Learnings from an Autonomous Driving Case. , 2020,

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