The Changing Rationale for Governance Choices: Early vs. Late Adopters of Global Services Sourcing

Published on Aug 1, 2018in Strategic Management Journal 5.48
· DOI :10.1002/smj.2795
Stephan Manning18
Estimated H-index: 18
(University of Massachusetts Boston),
Silvia Massini13
Estimated H-index: 13
(Manchester Institute of Innovation Research)
+ 1 AuthorsArie Y. Lewin37
Estimated H-index: 37
(Duke University)
Research Summary: This article studies how the logic of firm governance choices varies as a function of the time of adoption of particular sourcing practices. Using data on the diffusion of global business services sourcing as a management practice from early experiments in the 1980s through 2011, we show that the extent to which governance choices are affected by process commoditization, availability of external service capabilities, and past governance choices depends on whether firms are early or late adopters. Findings inform research on governance choice dynamics specifically in highly diverse and evolving firm populations. Managerial Summary: This article considers how firms have chosen delivery models in global services sourcing decisions over time. Based on comprehensive data, we make two major observations. First, we find that firms that began with global services sourcing early, invested mainly in their internal sourcing capacity, while outsourcing only simple tasks to external providers, whereas firms that started later invested more in their capability to outsource various services to increasingly sophisticated suppliers. Second, we find that initial investments in internal or external sourcing capabilities have a strong effect on future choices of delivery models. This explains why, even today, firms vary greatly in how they implement global sourcing decisions, and it suggests that newcomers should learn from their own peer group rather than from highly experienced firms.
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Published on Feb 1, 2002in Journal of Economic Behavior and Organization 1.30
Nicholas Argyres19
Estimated H-index: 19
(Boston University),
Julia Porter Liebeskind17
Estimated H-index: 17
(University of Southern California)
This paper explores mechanisms through which a party's choice of governance mode for a focal transaction is constrained by the governance choices it made for other, prior transactions. We argue that this condition of "governance inseparability" plays an important role in determining the differential organizational costs incurred by various firms when undertaking the same new activity, and is therefore important for theories aimed at predicting what kinds of firms will undertake such an activity....
47 Citations Source Cite
Published on Jun 1, 2006in Long Range Planning 3.22
Arie Y. Lewin37
Estimated H-index: 37
(Duke University),
Carine Peeters11
Estimated H-index: 11
(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 ...
243 Citations Source Cite
Published on Sep 1, 1988in Administrative Science Quarterly 5.88
Daniel A. Levinthal44
Estimated H-index: 44
Mark Fichman14
Estimated H-index: 14
The order of authorship is randomly assigned. Earlier versions of this paper were presented at the TIMS/ORSA meetings, May 1987, Academy of Management, August 1987, and the Law, Economics and Organization Workshop at Yale University. We gratefully acknowledge support from a Faculty Development Grant from Carnegie-Mellon. We have benefited from conversations with Bill Baber, Robert Kaplan, Jody Magliolo, and Jim Noel and appreciate their help in understanding the nature of the audit relationship....
413 Citations Source Cite
Published on Jan 1, 2005in Harvard Business Review 4.37
Thomas H. Davenport45
Estimated H-index: 45
It's all very well to be king, compassionate, and charismatic. But the most crucial predictor of executive success has nothing to do with personality or style. It's brainpower. Here's how to find those people with the sheer intelligence to become business stars.
375 Citations
Published on Feb 1, 2010in Journal of International Business Studies 6.20
Sea Jin Chang23
Estimated H-index: 23
Witteloostuijn van Arjen31
Estimated H-index: 31
Lorraine Eden28
Estimated H-index: 28
(Texas A&M University)
JIBS receives many manuscripts that report findings from analyzing survey data based on same-respondent replies. This can be problematic since same-respondent studies can suffer from common method variance (CMV). Currently, authors who submit manuscripts to JIBS that appear to suffer from CMV are asked to perform validity checks and resubmit their manuscripts. This letter from the Editors is designed to outline the current state of best practice for handling CMV in international business researc...
1,111 Citations Source Cite
Published on Feb 1, 1995in Academy of Management Journal 6.70
Ranjay Gulati37
Estimated H-index: 37
(Northwestern University)
Exploring the factors that explain the choice of governance structures in interfirm alliances, this study challenges the use of a singular emphasis on transaction costs. Such an approach erroneously treats each transaction as independent and ignores the role of interfirm trust that emerges from repeated alliances between the same partners. Comprehensive multiindustry data on alliances made between 1970 and 1989 support the importance of such trust. Although support emerged for the transaction co...
3,410 Citations Source Cite
Published on Aug 1, 2009in Journal of International Business Studies 6.20
Martin Kenney16
Estimated H-index: 16
(University of California, Davis),
Silvia Massini13
Estimated H-index: 13
(University of Manchester),
Thomas P Murtha1
Estimated H-index: 1
(University of Illinois at Chicago)
In this paper, we introduce the Journal of International Business Studies Special Issue on Offshoring Administrative and Technical Services (ATS). In doing so, we have attempted to locate the topic within the international business research tradition, as well as suggest challenges and opportunities that the phenomenon offers to theoretical and empirical research in the field. We examine the interplay of costs, knowledge, and innovation in the evolution of ATS offshoring from modest beginnings to...
94 Citations Source Cite
Published on Jun 1, 2009in Journal of International Management 2.30
P.D. Orberg Jensen10
Estimated H-index: 10
(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...
110 Citations Source Cite
Published on Jan 1, 2009in Journal of Operations Management 4.90
Ronan McIvor31
Estimated H-index: 31
(Ulster University)
Abstract Transaction cost economics (TCE) and the resource-based view (RBV) of the firm have been extremely influential in the study of outsourcing both in theory and practice. This paper argues that neither transaction cost economics nor the resource-based view alone can fully explain the complexities of outsourcing. A review and critique of these theories as a means of understanding the complexities of outsourcing is presented. A prescriptive framework for outsourcing evaluation is presented, ...
316 Citations Source Cite
Published on May 1, 1999in Technological Forecasting and Social Change 3.13
Duk Bin Jun7
Estimated H-index: 7
Yoon S. Park3
Estimated H-index: 3
Abstract We incorporate diffusion effects and choice effects in an integrated model to capture simultaneously the diffusion and substitution processes for each successive generation of a durable technology. The choice literature generally ignores demand dynamics and previous multigeneration diffusion models rarely include control variables. The proposed model is a combination of the two approaches. The basic premise of the proposed model states that the replacement of an older product by a newer...
71 Citations Source Cite
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