Publication: Selecting the governance mode when offshoring knowledge-intensive activities
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2018-10
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Elsevier Ltd.
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Abstract
The offshoring phenomenon has evolved in recent years, and can be understood from a threefold perspective: first, the evolution in the type of activity being offshored; second, the learning curve involving both the companies implementing offshoring and service providers; and third, the reasons for offshoring. This study proposes an empirical framework that will allow us to explore the interaction between the type of activity (specifically knowledge-intensive) and the drivers of the decision to select the most appropriate governance mode. Specifically, our results show that market-seeking drivers become the primary determinants prompting firms to offshore knowledge-intensive activities through a captive center. In contrast, the motivation to reduce costs moderates the decision to offshore knowledge-intensive activities by nurturing a preference for offshore outsourcing. The empirical evidence is supported by multi-country data from the Offshoring Research Network.
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Keywords
Captive offshoring, International sourcing, Offshoring drivers, Offshoring governance modes, Offshoring knowledge-intensive activities, Offshore outsourcing
Bibliographic citation
Journal of purchasing and supply management, 24(4), Oct. 2018, Pp. 275-287