• It provides the best decision-making tools in order to assist organizations in deciding which of their operations should be outsourced.
• Helps to prepare for decisions on implementing the necessary organizational changes arising from outsourcing
• It can be used for the analsysis and selection of outsourcing contracts, which are often of great complexity.
  

1. Asset specificity: second- best use of a transaction. Degree to which the assets used to conduct an activity can be redeployed to alternative uses and by alternative users without sacrifice of productive value.
2. Frequency: repetitiveness of a transaction. The level of recurrence of the activities needed by the firm for the transaction.
3. Uncertainty surrounding the transaction. Environmental uncertainty: uncertainty with respect to technology, demand, local factor supply conditions, inflation, and the like behavorial uncertainty.

Positive factors (any three in the following list):

• Working according to the transition plan
• Demand management
• Communication inside supplier organization
• Long- term motives of the service provider to put himself in the position of his client (vendor's empathy capability)

Negative factors:

• Short- term motives of the service provider to engage in an ITO deal
• Hiring consultancy support