Outsourcing and industrial decline

Published on Feb 1, 1992in The Executive
· DOI :10.5465/AME.1992.4274298
Richard A. Bettis29
Estimated H-index: 29
(SMU: Southern Methodist University),
Stephen P. Bradley14
Estimated H-index: 14
(Harvard University),
Gary Hamel24
Estimated H-index: 24
(LBS: London Business School)
Executive Overview The improper use of outsourcing is playing an important role in the continuing competitive decline of many Western firms. Western managers often view outsourcing as a defensive operational measure. The approach tends to be incremental. A whole series of incremental outsourcing decisions, taken individually, may make economic sense, but collectively they may also represent the surrender of the business's capability to compete. However, properly understood and managed as an overall part of strategy, outsourcing can aid competitiveness. This article, based on the authors' research with firms in North America. Europe, and Asia, discusses the manner in which the improper use of outsourcing can destroy the future of a business, and how the proper use of outsourcing can help build competitive advantage.
  • References (0)
  • Citations (440)
📖 Papers frequently viewed together
11.1k Citations
10.8k Citations
7,915 Citations
78% of Scinapse members use related papers. After signing in, all features are FREE.
Cited By440
Despite there being numerous studies exploring the relationship between competition and vertical integration, the empirical findings regarding the nature of this relationship are still unclear. The current study suggests that technological niche width mediates the relationship between competition and vertical integration. It also suggests that technological niche width and vertical integration play a complementary role in enhancing firm performance. These arguments have found empirical support i...
#2Robert Obermaier (University of Passau)H-Index: 7
view all 2 authors...
Vertical disintegration in manufacturing industries has been an increasing trend since the 1990s in many countries. According to a prevailing management paradigm of focusing on core competencies, firms should have vertically disintegrated (i.e. outsourced non-core competencies) to achieve cost savings, enhance competitiveness and improve firm performance. In line with this management paradigm, most empirical studies therefore hypothesized a negative linear relationship between the degree of vert...
#1Sarah Cheah (NUS: National University of Singapore)
#2Cristiano Bellavitis (SU: Syracuse University)
Last. Alessandro Muscio (University of Foggia)H-Index: 16
view all 3 authors...
Prior empirical research is inconclusive in determining whether technology complexity influences the financial performance of research commercialization projects and how various types of organizational resources contribute to performance. We analyse research commercialization projects involving the collaboration between public research institutes and private firms in Singapore. We examine how the technology complexity of these collaborative projects impacts their financial performance, measured ...
This paper reports a case study of an Indian aerospace industry, XYZ Aeronautics Limited, with an objective to bring reduction in cycle time of outsourcing process. The focus is to identify bottleneck areas and investigate into the improvement opportunities. The paper enriches the present body of knowledge by contributing a methodology and its application for a real-life case study to understand the implications of outsourcing on operational planning. The analysis reported in this research is ba...
#1Grigorios Asimakopoulos (Charles III University of Madrid)H-Index: 4
#2Antonio J. Revilla (Bath Spa University)H-Index: 5
Last. Kremena Slavova (Leonardo)H-Index: 1
view all 3 authors...
This study examines the relationship between external knowledge sourcing and firm innovation efficiency. We build on the organizational learning theory to propose that this relationship follows an inverted U‐shape: as the level of external knowledge sourcing increases from low to moderate, firm innovation efficiency increases; as the level of external knowledge sourcing increases from moderate to high, firm innovation efficiency declines. Further, we explore the moderating role of different cont...
1 CitationsSource
#2Ina DrejerH-Index: 14
Last. Brian Vejrum WæhrensH-Index: 10
view all 5 authors...
This paper aims to explore value creation configurations pursued by suppliers in high-cost countries. The proposed value creation configuration approaches are seen as means for supplier firms to strengthen their competitiveness when faced with increasing global sourcing.,Survey data on supplier firms in Denmark are used in a hierarchical cluster analysis. The identified clusters are interpreted as expressions of different value creation configurations pursued by suppliers with regards to relatio...
The goal of the paper is to find out about the grounds for the selection of location options for organie functions within a multi-entity organisation. For this goal the following research questions have been formulated: (1) What location options do we have for organic functions in a multi-entity organisation? (2) What potential grounds can determine the choice of a particular option? (3) What factual grounds determined the choice of location options for functions in multi-entity organisations co...
#1Pooja Thakur-Wernz (WSU: Wichita State University)
Purpose The purpose of this study is to examine backsourcing, which refers to the full or partial re-internalization of a firm’s previously outsourced activity. Researchers have primarily focused on the drivers of backsourcing, but this paper builds on that prior research to develop a typology of backsourcing. Design/methodology/approach Drawing on transaction cost economics and the resource-based view (RBV), the paper posits that firms backsource because of two factors – changes in their short-...
#1Maqsood Sandhu (United Arab Emirates University)H-Index: 9
#2Ahm Shamsuzzoha (Sultan Qaboos University)H-Index: 12
Last. Petri Helo (University of Vaasa)H-Index: 25
view all 3 authors...
Purpose The purpose of this paper is to deal with the importance and obstacles of outsourcing strategy in project business in terms of product development perspectives. This strategy is intrinsically analyzed and evaluated with respect to the strategic business environments. Design/methodology/approach The objective of this research is to analyze the advantages and limitations of the outsourcing that have been identified in prior studies. This research has attempted to investigate the performanc...
#1Anne W. Fuller (CSUS: California State University, Sacramento)H-Index: 4
This paper looks at the vital role of industrial research and development (R&D). The increased outsourcing of industrial R&D is contrasted with a resource-based view of competitive advantage which maintains capabilities that are valuable, rare, imitable, and non-substitutable (VRIN), and should be internalized in the firm. Traditional business formation literature is also supportive of keeping R&D “inhouse”. R&D outsourcing research is leveraged to posit possible reasons for the increased amount...