Glossary of terms

This glossary is intended to assist you in getting a general understanding of commonly used terms and concepts when dealing with outsourcing and outsourcing governance. We welcome your contribution to further improve and expand the glossary.

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
There are currently 27 names in this directory beginning with the letter I.
In-scope Service Request
Request for service that is part of the standard services being provided by the service provider

A reward provided to the service provider when service levels are exceeded or some other achievement is reached. These terms are laid out in the outsourcing contract  

Increased Impact Service Level
A level of service that is defined in a service level where when missed it had a severe negative impact on the client's operational environment, to the extent that the service level credit is increased by a multiple factor

A method of shifting legal liability from one party to another by contract.

Indirect cost
A cost incurred which cannot be directly allocated in full to a single product, service, customer, cost center or business activity; incurred on behalf of a number of cost units or centers to which the cost may be apportioned

Information Technology Offshoring
Information Technology Offshoring is the transfer of ownership of some or all information technology processes or functions to providers located at a different country from the country (or countries) where the company receiving the services is located

Information Technology Outsourcing (ITO)
Information Technology Outsourcing (ITO) is the transfer of ownership of some or all information technology processes or functions to a service provider. This could include administrative, delivery, or management-related processes or functions

Infrastructure Managed Services (IMS)
Infrastructure Managed Services (IMS) is a form of IMO where the service provider assumes responsibility of certain end-to-end functions related to the physical IT infrastructure

Infrastructure Management Outsourcing (IMO)
Infrastructure Management Outsourcing (IMO) is an outsourcing model of infrastructure management where the buyer retains ownership of the assets and the service provider provides delivery primarily from a remote or offshore location

Infrastructure Outsourcing (IO)
Infrastructure Outsourcing (IO) is the outsourcing of one or more infrastructure towers within the scope of an ITO contract

Infrastructure Towers
IT Infrastructure services can be categorized or described by distinct "towers" of offerings (e.g., datacenter, desktop, etc. outsourcing)

Innovation capture
How an organization will be able to exploit new technologies that may drive improved business process. In some cases, the service provider may be unwilling to invest unless the client pays — unless the new technology can be amortized across multiple clients. Contracts need to be structured in a way that rewards the service provider with a portion of savings won

Input Cost
Costs of direct labor and physical resources required to execute work. Includes salaries of front-line staff, cost of facilities, telecommunication costs, etc.

Input-based Pricing
A system of pricing based on the number of units of resource consumed in order to deliver a previously agreed-upon service

A decision by an organization to retain functions internally rather than outsource. The decision is often made after the organization has performed independent benchmarking to determine that its costs and efficiencies are in line or better than those achieved by comparable organizations. The term is also used in cases where services are being brought back in house after a period of outsourcing them

Intellectual Property
Intellectual property. An intangible entity that includes some degree of creative effort, such as software design. An outsourcing contract's Terms and Conditions section should include a clause that sets out an indemnity that the service provider will give to the client, to protect the client against claims of infringement with respect to any products supplied

Interim Service Levels
Service levels prior to the transition but subsequent to contract signing

International Financial Reporting Standards (IFRS)
Set of accounting standards issued by the International Accounting Standards Board

Inverted Build Operate Transfer (IBOT)
An offshore business model in which the offshore service provider initially provides only implementation support and is allowed to buy in to the entity later

ISAE 3402
International Standard on Assurance Engagements (ISAE) No. 3402, Assurance Reports on Controls at a Service Organization, was issued in December 2009 by the International Auditing and Assurance Standards Board (IAASB), which is part of the International Federation of Accountants (IFAC). ISAE 3402 was developed to provide an international assurance standard for allowing public accountants to issue a report for use by user organizations and their auditors (user auditors) on the controls at a service organization that are likely to impact or be a part of the user organization’s system of internal control over financial reporting. ISAE 3402 also became effective on 15 June 2011

ISO 9000 series of standards
The ISO 9000 family addresses various aspects of quality management and contains some of ISO’s best known standards. The standards provide guidance and tools for companies and organizations who want to ensure that their products and services consistently meet customer’s requirements, and that quality is consistently improved.

ISO 9001
ISO 9001 sets out the criteria for a quality management system and is the only standard in the family that can be certified to (although this is not a requirement). It can be used by any organization, large or small, regardless of its field of activity. In fact, there are over one million companies and organizations in over 170 countries certified to ISO 9001. The standard is based on a number of quality management principles including a strong customer focus, the motivation and implication of top management, the process approach and continual improvement.

IT Facility Management
The management of a user's computer installation by an outside organization. All operations including systems, programming and the datacenter can be performed by the facilities management organization on the user's premises

IT Help Desk
A source of technical support for hardware or software. Help desks are staffed by people who can either solve the problem directly or forward the problem to someone else

IT Infrastructure
IT Infrastructure refers to the consulting, installation, integration support, and maintenance of hardware and netwerking infrastructure

The Information Technology Infrastructure Library or ITIL, is a set of practices for IT service management (ITSM) that focuses on aligning IT services with the needs of business.

ITIL describes processes, procedures, tasks, and checklists which are not organization-specific, but can be applied by an organization for establishing integration with the organization's strategy, delivering value, and maintaining a minimum level of competency. It allows the organization to establish a baseline from which it can plan, implement, and measure. It is used to demonstrate compliance and to measure improvement.

Information technology outsourcing. The transfer of internal non-core IT processes, such as infrastructure, applications development and maintenance, end-user computing, help desk, network support and data center operations, to an external service provider that improves these processes and administers these functions to an agreed service standard and, typically, at a reduced cost