Managing IT outsourcing and core capabilities for business change: The Commonwealth Bank of Australia case

This teaching case provides a practical illustration of the challenges of using IT outsourcing and evolving the IT function’s structure, governance arrangements, and capabilities in a dynamic business context. A central focus is on retained core IT capabilities at Commonwealth Bank of Australia (CBA) in the 1997–2006 period, needed to gain business value from IT and IT suppliers. It foregrounds two persistent issues in IT management. First, what are the IT capabilities that must be retained within an organization? Second, what are the mechanisms for developing, nurturing, maintaining, and evolving these capabilities? The teaching case shows the dynamic and evolutionary nature of this process.