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Offshoring Work: Business Hype or the Onset of Fundamental Transformation?
Abstract
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 practices largely follows an opportunistic bottom-up, sequential process. During the early phase companies report cost savings and achieved service levels far exceeding initial expectations. This paper presents the case that offshoring may actually foreshadow a much more fundamental transformation involving several co-evolving forces including the commoditisation of organisational processes, the emergence of hybrid organisational forms, the competition of developing countries for offshoring jobs, and the globalisation of sourcing and management of human capital.

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  • References (27)
  • Cited By (238)
Mary C. Lacity44
Estimated H-index: 44
,
Leslie P. Willcocks64
Estimated H-index: 64
,
David Feeny15
Estimated H-index: 15
300 Citations
2006 in Long Range Planning [IF: 3.22]
Lars Huemer2
Estimated H-index: 2
Value creation in the supply literature commonly builds on the value chain model. This results in a focus on sequential interdependencies, an emphasis on coordination by planning and a restricted view of possible positioning options. This article contributes an original approach to the supply management debate, based on value configuration analysis. Value configuration analysis acknowledges the value chain logic, but finds it constraining in certain business systems, and also includes recognitio...
58 Citations Source Cite
Zhen-shan Cui1
Estimated H-index: 1
70 Citations
Mary C. Lacity44
Estimated H-index: 44
,
Leslie P. Willcocks64
Estimated H-index: 64
From the Publisher: "This book has the potential to become the definitive book on the many dimensions of outsourcing as it matures into a complex, multi-faceted phenomenon. IT outsourcing is still the subject of considerable concern for all stakeholders involved in this area. Written by two internationally acclaimed researchers in this area, this book represents the most definitive research and best practice base so far on the organizational pursuit of IT outsourcing." "This study is based on re...
245 Citations Source
2005 in Harvard Business Review [IF: 4.37]
M Gottfredson1
Estimated H-index: 1
,
R Puryear1
Estimated H-index: 1
El liderazgo es distinto de la gestion, pero no por las razones que cree la mayoria de las personas. El liderazgo no es algo mistico ni misterioso. No tiene nada que ver con tener carisma o algun rasgo de la personalidad exotico. No es el territorio de unos pocos elegidos. Tampoco el liderazgo es necesariamente mejor que la gestion o un reemplazo de ella. Mas bien, el liderazgo y la gestion son dos sistemas de accion complementarios y distintos, afirma John Kotter en este articulo publicado por ...
303 Citations Source
Michael J. Earl14
Estimated H-index: 14
Although large corporations continue to outsource it services, the issues of whether and how to outsource generate strong emotions on the part of managers. Many practitioners and academics now argue for selective or "smart" sourcing. According to this author, this is probably a sensible approach to balance efficiency and effectiveness in providing IT services. However, the author argues that companies should first ask why they should not insource IT services. His perspective is based on an analy...
585 Citations Source
2001 in European Management Journal [IF: 2.37]
Jérôme Barthélemy9
Estimated H-index: 9
,
Dominique Geyer4
Estimated H-index: 4
In this article, we study IT outsourcing in two European countries. A survey carried out on 160 large French and German firms highlights the main differences between French and German IT outsourcing practices. First, German firms tend to outsource less critical activities than French ones. Second, IT outsourcing joint-decisions (i.e. top and IT management) are more frequent in Germany than in France. Third, IT outsourcing operations more frequently entail personnel transfers and layoffs in Franc...
78 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
Kevin Kelly1
Estimated H-index: 1
In New Rules, Kevin Kelly brings together the many various forces at work in the emerging economies and puts forward 10 principles to guarantee accords in the post-industrial digital revolution. The Network Economy has created a new market and a new economy. The major changes have not been the growth of computers but the increased communications between these computers. Wealth now comes from innovation and networks are the ideal environment for these new discoveries. This means the rate of chang...
314 Citations Source
  • References (27)
  • Cited By (238)
Lars Bråd Nielsen (Strategy&), Hanne Nørreklit3
Estimated H-index: 3
In response to a lack of research, this paper explores the type of reasoning that companies use to structure their complex outsourcing decision and the procedures for producing relevant accounting information. Analyzing two manufacturing companies, we uncover two methods for structuring the outsourcing decision-making process and for determining relevant accounting information: an analytical method and an actor-based method rooted in pragmatic constructivism. The two cases show that both strateg...
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Carine Peeters12
Estimated H-index: 12
,
Sébastien Point8
Estimated H-index: 8
,
Patricia Garcia-Prieto4
Estimated H-index: 4
Timothy Sturgeon1
Estimated H-index: 1
,
Clair Brown1
Estimated H-index: 1
,
Susan E. Woodward ... more
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Edgar Bellow (Reims Management School)
The problem of climate change is becoming increasingly prevalent in the business context. Risks such as increased risk of extreme weather events and the attendant loss of production site facilities, and changes in population density and migration patterns, may seem remote from the business offshoring decision. However, it is in fact highly relevant, as the recent case of flooding in Thailand and its effects on the global hard drive industry shows. The discussion in this chapter focuses on the ri...
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Vinay Tiwari3
Estimated H-index: 3
(Erasmus University Rotterdam)
In recent years, outsourcing has become a ubiquitous phenomenon. Despite extensive research, several examples of outsourcing failure are prevalent. In this paper, complimenting the strategic and economic studies on outsourcing, we focus on the operational execution challenges by examining transition phase, which starts immediately after contract signing and involves the critical transfer of outsourced activities from client to vendor firm. We conceptualize and illustrate transition as interplay ...
15 Citations Source
2012 in International Conference on Information Systems
Dorit Nevo13
Estimated H-index: 13
(York University),
Julia Kotlarsky16
Estimated H-index: 16
(University of Warwick),
Saggi Nevo11
Estimated H-index: 11
(Texas A&M International University)
Technological advancements enable new sourcing models in software development such as cloud computing, software-as-a-service, and crowdsourcing. While the first two are perceived as a re-emergence of older models (e.g., ASP), crowdsourcing is a new model that creates an opportunity for a global workforce to compete with established service providers. Organizations engaging in crowdsourcing need to develop the capabilities to successfully utilize this sourcing model in delivering services to thei...
12 Citations Source
Shailendra C. Jain Palvia12
Estimated H-index: 12
,
Prashant Palvia30
Estimated H-index: 30
,
Weidong Xia16
Estimated H-index: 16
... more
Global outsourcing of IT and IT-enabled services (ITES) has now become an accepted corporate strategy of a vast majority of firms around the world. The functions being offshored have increased in scope and magnitude and have climbed the value chain ladder. However, the literature has overwhelmingly focused on client-centric issues to the neglect of vendor concerns. There is a rich tradition of ranking critical issues confronting Information Systems executives, and some studies have even explored...
9 Citations Source Cite
Frank Wijen8
Estimated H-index: 8
,
Arjen Slangen1
Estimated H-index: 1
Purpose – While previous studies have highlighted opportunities, this chapter sheds light on the negative effects of globalization that mature European multinational enterprises (MNEs) encounter. Design/methodology/approach – We develop an extended network perspective to argue that globalization has resulted in several network-related threats for mature European MNEs. Findings – European MNEs encounter three types of negative effects. First, globalization has caused local problems to increasingl...
1 Citations Source Cite
Peter D. Ørberg Jensen11
Estimated H-index: 11
(Copenhagen Business School),
Torben Pedersen44
Estimated H-index: 44
(Copenhagen Business School),
Bent Petersen26
Estimated H-index: 26
(Copenhagen Business School)
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 off...
1 Citations Source Cite
Petra Edoff1
Estimated H-index: 1
Offshoring is a hot topic in the industrial and academic community over the last few years, evolving from a focus on manufacturing to product development and R&D. Offshoring refers to the proce ...
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