Outsourcing of Information Technology (IT) is a well-established part of Australian business. Offshore outsourcing of IT support and development is a critical and widespread part of the globalised Australian and other nations’ economies. In Australia, national organisations such as the National Australia Bank (NAB) and Australia’s largest telecommunication company, Telstra, continue to outsource work to outsourcing vendors – that is, obtaining goods and services from outside suppliers. It has long been thought that IT outsourcing is motivated primarily by cost cutting in the IT department but the latest trends suggest that outsourcing is more about improving usage of internal resources and service satisfaction. Authors Lee, J-N (2000) and Loh & Venkatraman (1992) argue that outsourcing IT functions to external service providers is done in order to acquire economic, technological and strategic advantage. In this thesis, it is proposed that the main driver for outsourcing IT has matured from being purely cost driven to one of strategic business practice.