Global Shift-Back’s: A Strategy for Reviving Manufacturing Competences

Published on Aug 4, 2017
· DOI :10.1108/S1571-502720170000030010
Bella Belerivana Nujen3
Estimated H-index: 3
Lise Lillebrygfjeld Halse5
Estimated H-index: 5
Global businesses base their sourcing operations and manufacturing decisions primarily on financial principles and metrics. What is often disregarded is the strategic value of domestic locations and contextual tacit knowledge. However, recent empirical work on knowledge flows shows that proximity is crucial. The risk of losing knowledge and important competencies developed through generations within companies and value chains needs to be considered when developing a global sourcing strategy. This chapter sheds light on how global shift-backs, through backshoring are seen to affect organizations that are located in a high-cost country. Based on interviews with managers and key personnel within a specific industry, we explore how companies preserve innovative capabilities when considering closing down (captive) offshore centers or when embarking on a backshoring strategy. The implications derived from the case offers valuable insights into how organizational capabilities could be restored when companies bring manufacturing back.
  • References (60)
  • Citations (6)
📖 Papers frequently viewed together
43 Citations
33 Citations
314 Citations
78% of Scinapse members use related papers. After signing in, all features are FREE.
#1Bernhard Dachs (Austrian Institute of Technology)H-Index: 12
#2Bernd EbersbergerH-Index: 18
Last. Oliver Som (Fraunhofer Society)H-Index: 6
view all 4 authors...
We investigate the effects of production offshoring on the innovation activities of manufacturing firms in the home country. The analysis is based on a dataset of more than 3,000 manufacturing firms from seven European countries. We find that offshoring firms on average employ a higher share of R&D and design personnel, introduce new products more frequently to the market, and invest more frequently in advanced process technologies compared to non-offshoring firms. Concerns that offshoring may h...
7 CitationsSource
#1Ilan OshriH-Index: 21
#2Julia KotlarskyH-Index: 19
Last. Leslie P. WillcocksH-Index: 66
view all 3 authors...
27 Citations
#1Lydia BalsH-Index: 14
#2Anika Daum (University of Applied Sciences, Mainz)H-Index: 1
Last. Wendy L. Tate (UT: University of Tennessee)H-Index: 24
view all 3 authors...
24 Citations
#1Lise Lillebrygfjeld Halse (Molde University College)H-Index: 5
Over the last decades, the Norwegian shipbuilding industry has become increasingly globalized, with offshoring of production of to low cost locations. Globally dispersed production of complex and customized ships has proven to be challenging with respect to coordination of activities and exchange of knowledge. The paper investigates how different governance alternatives affect knowledge exchange in the global value chains of two shipbuilding groups. The findings indicate that vertical integratio...
2 CitationsSource
#1Lise Lillebrygfjeld Halse (Molde University College)H-Index: 5
#2Kristina Kjersem (Molde University College)H-Index: 3
Last. Jan EmblemsvågH-Index: 3
view all 3 authors...
During the last decades, the Norwegian shipbuilding industry has successfully delivered complex and customized offshore vessels for the global market. This industry has historically been characterized by highly skilled workmanship that makes flexible adaptations and improvements in the production process possible, which has been a competitive advantage of the industry. Nevertheless, more complex projects, competitive pressure and globally distributed value chains, call for more formalized planni...
3 CitationsSource
Offshoring is one of the defining phenomena of 21st century manufacturing. It attracts significant attention in academic, business, and social circles in both developed and developing economies. Despite the relevance of this phenomenon, there is limited research exploring to what extent offshoring effort is explained by manufacturing strategy. In this study I investigate whether offshoring effort can be predicted by manufacturing competitive factors such as cost, flexibility, and delivery, parti...
26 CitationsSource
#1Jan Stentoft Arlbjørn (University of Southern Denmark)H-Index: 24
#2Ole Stegmann Mikkelsen (University of Southern Denmark)H-Index: 7
Abstract This note discusses the phenomenon of backshoring manufacturing relying on empirical results based on a large-scale Danish questionnaire-survey. The note argues for further research on antecedents, motivators, and barriers of the use of globalisation strategies. It further argues for using automation in order to maintain production jobs. Lastly, the note demand more research on how ambidexterity as a dynamic capability serves as a predecessor to cope with the dynamics of globalisation s...
87 CitationsSource
Abstract The phenomenon of reshoring to the U.S. has received wide attention ever since it became a political platform for U.S. politicians during the last presidential election. The economic downturn, a heightened emphasis on sustainability, and increasing customer expectations for flexibility and improved cost performance drove firms to re-consider the appropriate “shoring” decision. The intent of this research note is to add a U.S.-centric perspective to the “shoring” debate.
80 CitationsSource
#1Luciano Fratocchi (University of L'Aquila)H-Index: 14
#2Carmela DiMauro (University of Catania)
Last. Andrea Zanoni (UNIBO: University of Bologna)H-Index: 5
view all 5 authors...
Abstract Interest in back-reshoring strategies – intended as companies׳ decisions to reverse previous off-shoring by bringing manufacturing back home – has gained momentum recently. However, little is known so far about the magnitude of this phenomenon, about its geographical boundaries, and about the underlying motivations. In this paper a characterization of back-shoring as part of the dynamics of firms׳ internationalization strategies is offered. Next, building on emerging empirical evidence,...
146 CitationsSource
#1Goeran Roos (Swinburne University of Technology)H-Index: 1
2 CitationsSource
Cited By6
#1Marco BettiolH-Index: 8
#2M. ChiarvesioH-Index: 1
Last. Luciano FratocchiH-Index: 14
view all 5 authors...
Manufacturing offshoring has received substantial attention within international business studies that have explored where activities are located and how they are governed. However, recent examples of manufacturing relocation to the home country/region have put the advantages of offshoring under scrutiny, since the location of production activities in high-cost countries may have positive impacts in terms of innovation and marketing opportunities. Despite the growing interest in offshoring and “...
#1Jesús F. Lampón (University of Vigo)H-Index: 7
#2Javier González-Benito (University of Salamanca)H-Index: 29
3 CitationsSource
#1Malin Johansson (Lund University)H-Index: 8
#2Jan Olhager (Lund University)H-Index: 35
Last. Jan Stentoft Arlbjørn (University of Southern Denmark)H-Index: 24
view all 4 authors...
Abstract This paper describes an empirically derived classification of the various factors that influence offshoring and backshoring decisions based on data from 275 offshoring and 160 backshoring projects. The study developed one set of factor bundles for offshoring and another set of such bundles for backshoring; these sets were then compared, and their relationships with post-relocation benefits were analyzed. These benefits were also grouped into bundles based on the empirical relationships....
9 CitationsSource
#1David Bailey (Aston University)H-Index: 17
#1David Bailey (Aston University)H-Index: 22
Last. Lisa De Propris (University of Birmingham)H-Index: 17
view all 3 authors...
This paper offers a novel perspective on manufacturing home-sourcing. We present evidence that home-sourcing occurs in the context of a new competitive environment where the relative importance of scale economies versus variety is altered, and a recoupling of innovation and production within industrial ecosystems becomes desirable. We look at the determinants of manufacturing home-sourcing. We find that R&D-intensive businesses with core non-standardized products are more likely to switch sourci...
6 CitationsSource
#1Malin Johansson (Lund University)H-Index: 8
#2Jan Olhager (Lund University)H-Index: 35
Abstract The global nature of businesses has increased the geographical dispersion of operations and has made the location decision an important strategic perspective for manufacturing firms. The consensus view is that three major plant location factors must be kept in mind: (1) access to low-cost manufacturing, (2) proximity to market, and (3) access to development competences. Two options for changing the global manufacturing footprint are offshoring and backshoring. This research has analysed...
15 CitationsSource
#1Kristina KjersemH-Index: 3
#2Gabriele Hofinger Jünge (NTNU: Norwegian University of Science and Technology)H-Index: 1
Last. Jan EmblemsvågH-Index: 3
view all 3 authors...
The planning process in Engineer-To-Order (ETO) projects is challenging due to: global network of participants within a project, dynamic iterations on design and engineering activities as well as the need for completing activities in a concurrent manner that shorten the delivery time. Moreover, managerial decisions on what and where to outsource disturbs the planning process due to lack of integration between different working methodologies or systems. In this article, we present some of the cha...