Relational Dynamics at British Aerospace
Relational Dynamics at British Aerospace
This chapter discusses a case study of the outsourcing arrangement between British Aerospace (BAe) and Computer Science Corporation (CSC). The case study presents an example of a total outsourcing contract, where the client company has successfully manoeuvred itself into a win situation, and by doing so is slowly improving the suppliers' economic situation in the venture through additional and new areas of business. This case highlights the importance of a detailed contract in a long-term exchange-based relationship, and especially the important role of the contract in providing a continuing governance structure for the relationship. Because of the centrality of the contract, it was recognized that realignment procedures needed to be mutually implemented to ensure the contract properly represented BAe's business and technological changes, but also the shifting basis on which CSC could provide services at a reasonable profit.
Keywords: IT outsourcing, outsourcing contract, British Aerospace, Computer Science Corporation, governance structure
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