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Do Expectations Match Reality When Firms Consider the Risks of Offshoring? A Comparison of Risk Assessment by Firms with and Without Offshoring Experience
Abstract
The risk associated with offshoring is a recurrent theme in research. However, previous research has mainly given a static picture of offshoring risks even though the strategies of offshoring firms, including their views on risks, may change as they gain experience in the field. In this chapter we investigate the influence of organizational learning on firms’ perceptions of the risks in offshoring. We use survey data from firms in Scandinavia and compare the risk assessments of firms without offshoring experience with firms that engage in offshoring. The findings show that firms without offshoring experience particularly stress exogenous risks while firms with offshoring experience see the endogenous risks as important. We offer two different interpretations of these results.

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  • References (43)
  • Cited By (1)
Leslie P. Willcocks64
Estimated H-index: 64
,
Mary C. Lacity44
Estimated H-index: 44
Customer and Supplier Learning on IT and Business Service Practices Managing 54 Processes in the Sourcing Life Cycle Retaining Nine Core Capabilities In-House Assessing Twelve Supplier Capabilities The Winner's Curse in IT Outsourcing: The Case of Esso Outsourcing Human Resources: The Case of BAE Systems Outsourcing Indirect Procurement: The Case of BAE Systems Managing Knowledge When Outsourcing: Cases in Financial Services Offshoring of IT Work: 20 Practices How Corporations E-Source Applicati...
120 Citations Source Cite
Michael J. Mol18
Estimated H-index: 18
(London Business School)
Figures Tables Acknowledgements 1. Outsourcing 2. What we know about outsourcing 3. A new perspective 4. The outsourcing process 5. Shifting the curve 6. Shifts of the curve 7. Managing outsourcing 8. Outsourcing research agenda 9. Future trends and conclusions Appendix References.
69 Citations Source Cite
Masaaki Kotabe47
Estimated H-index: 47
,
Kristiaan Helsen15
Estimated H-index: 15
Overview: Theoretical Paradigms, Issues and Debates - Masaaki Kotabe and Kristiaan Helsen PART ONE: CHANGING MARKET ENVIRONMENTS The Ancient Road: An Overview of Globalization - Terry Clark, Monica Hodis and Paul D'Angelo The Changing Global Political and Institutional Environment - Jonathan Doh and Terrence Guay Marketing and the Global Legal Environment - Subhash Jain and Robert Bird PART TWO: CONSUMER BEHAVIOR RESEARCH Consumer Cognition across Cultures - Bernd H Schmitt and Nader Tavassoli N...
22 Citations Source
Jette Schramm-Nielsen2
Estimated H-index: 2
,
Peter A. Lawrence55
Estimated H-index: 55
,
Karl Henrik Sivesind2
Estimated H-index: 2
1. Making the Case 2. Context 3. Breweries in Scandinavia 4. Furniture 5. Confectionary and Food Production 6. Shipbuilding and More Besides 7. Differences and Similarities 8. Present and Prospect Index
31 Citations
2006 in Long Range Planning [IF: 3.22]
Arie Y. Lewin38
Estimated H-index: 38
(Duke University),
Carine Peeters12
Estimated H-index: 12
(Duke University)
This paper reports the findings from the Offshoring Research Network (ORN), which studies the offshoring of administrative and technical work to low-cost countries. Initial data suggest that offshoring is still at an early stage but growing rapidly. However, as the practice of offshoring becomes more widely adopted it is likely to fundamentally change the way companies in the industrialised high-cost economies organise to compete globally. The picture that emerges is that adoption of offshoring ...
238 Citations Source Cite
James Brian Quinn21
Estimated H-index: 21
Today's knowledge- and service-based economy offers companies a chance to increase profits through strategic outsourcing of intellectually based systems. As companies disaggregate intellectual activities internally and outsource more externally, they approach true virtual organization with knowledge centers interacting largely through mutual interest and electronic ? rather than authority ? systems. In this article, Quinn outlines an integrated knowledge and outsourcing strategy that can mitigat...
918 Citations Source
1989 in Journal of Business Research [IF: 2.51]
Masaaki Kotabe47
Estimated H-index: 47
(University of Missouri)
Abstract This article examines a widely debated issue: the “hollowing-out” of U.S. multinationals. Using path analysis applied to the benchmark survey of U.S. direct investment abroad for 1977 and 1982, the study shows that the “hollowness” of U.S. multinationals is indicative of their global competitiveness, although causal relationships are not obvious. “Hollowing-out” may be an offshoot of the deindustrialization of the U.S. economy; it may alternatively signify “reindustrialization” of U.S. ...
50 Citations Source Cite
Masaaki Kotabe47
Estimated H-index: 47
,
Michael J. Mol18
Estimated H-index: 18
,
Janet Y. Murray24
Estimated H-index: 24
39 Citations Source
Peter D. Ørberg Jensen11
Estimated H-index: 11
(Copenhagen Business School)
Based on longitudinal case studies of offshoring of advanced IT and engineering services from Danish firms to Indian firms, this paper explores organizational learning that occurs over time in both home and host firms and uses learning as a measure of the firm impact of advanced services offshoring. The findings are consistent with the theoretical view that advanced services offshoring must be understood as an antecedent for strategic business development and organizational change in both home a...
107 Citations Download PDF Cite
Masaaki Kotabe47
Estimated H-index: 47
(Kobe University),
Michael J. Mol18
Estimated H-index: 18
(University of Reading),
Sonia Ketkar1
Estimated H-index: 1
(Towson University)
Abstract and Key Results • Outsourcing has gained much prominence in managerial practice and academic discussions in the last two decades or so. Yet, we still do not understand the full implications of outsourcing strategy for corporate performance. No general explanation has so far been provided for how outsourcing could lead to deterioration in a firm’s competence base. We longitudinally analyze three cases of major consumer electronics manufacturers, Emerson Radio from the U.S., Japan’s Sony ...
58 Citations Source Cite
  • References (43)
  • Cited By (1)
Torben Schubert14
Estimated H-index: 14
(Lund University),
Elisabeth Baier6
Estimated H-index: 6
,
Christian Rammer20
Estimated H-index: 20
We develop a behavioural framework of bounded rational decision-making under uncertainty to analyse the role of technological dynamism in the firm’s environment for its decision to internationalise innovation. Applying prospect theory, we argue that technological uncertainty in the firm’s environment affects its risk preferences differently depending on its technological capabilities. A key prediction is that firms with low capabilities will internationalise innovation when faced by technologica...
2 Citations Source Cite

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