Rise and Fall of an Information Technology Outsourcing Program: a qualitative Analysis of a Troubled Corporate Initiative

One team and outsourcing. 
In their public comments, executives encouraged all 
employees to act as “one team.” Furthermore, employees were referred to as “team members” as 
opposed to “employees.” Icarus’s headquarters were spread across multiple facilities in a single 
U.S. metropolitan area and a facility in India. Icarus also had offices for its Supply Chain across 
the U.S. and other countries. Information Technology teams often worked across—or partnered 
with— multiple IT functions in the U.S. and India as well as with partners in business functions. 
When projects went well, teams were often credited with working as one team. “One-team” 

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posters and slogans were used by executives to encourage collaboration between groups, 
especially the geographically distant IT teams in the U.S. and India. 
As previously mentioned, vendors were also referred to as “partners.” However, as I will 
discuss later in this chapter, vendors did not possess the same social or cultural capital as 
employees. Additionally, it was considered taboo to openly discuss “outsourcing,” which 
implied employee layoffs. The taboo was associated with, and reinforced, by one of Icarus’s 
competitor’s widely publicized outsourcing gaffe. That failed project culminated with the firm 
bringing much of the outsourced work back in-house at a sizable financial and employee morale 
cost. 
Nevertheless, Icarus “partnered” with a lot of vendors. IT contractors actually 
outnumbered the number of IT employees. The difference in the Icarus habitus was that these 
contractors were used as staff augmentation (or “staff aug” in the Icarus parlance), not in the 
whole-scale outsourcing of an entire function. Icarus IT had operated in a predominantly staff 
augmentation model for software development since the mid-1990s.
Given the pace of demand for IT work, it was completely acceptable, and expected, to 
augment one’s project team with contractors to increase capacity and the pace of output.
Contractor engineers were temporarily embedded within project teams to fill specific roles (i.e., 
database administrator, computer programmer), and could be dismissed at the completion of a 
project or retained and assigned to other initiatives. As with many Fortune 1000 firms with large 
IT operations, the staff-augmentation approach provided Icarus a means to temper or hold 
employee-staffing levels flat by smoothing supply-and-demand needs with temporary labor. 
Despite the growing volume of Icarus’s shadow workforce of IT contractors, employees 
and executives did not associate the de facto “staff aug” strategy with the “negative” aspects of 

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outsourcing such as job loss or their competitor’s public blunder. Talking about “outsourcing” 
was taboo, but growing a bigger labor force of “staff aug” “partners” was completely acceptable 
and the norm as additional contractors could be added (and removed) relatively easily.