Outsourcing of supply chain processes: evaluating the impact of congruence between outsourcing drivers and competitive priorities on performance

The outsourcing of elements of supply chain processes is now an integral component of the operationalization of a firm s competitive business strategy. While the purported goal of outsourcing is usually to derive a competitive advantage in the marketplace, it is not clear whether the outsourcing decisions made by firms are always strategically aligned with their overall competitive strategy. To shed light on this important issue, this research study empirically examines the performance impact of the alignment (congruence) between a firm s competitive priorities (cost, flexibility, innovativeness, quality, and time) and the drivers of its outsourcing decisions. First, we develop and validate a survey instrument used to collect data for this study from manufacturing firms operating in the United States. Next, we use structural equation modeling to examine the impact of alignment between individual competitive priorities and related groups of outsourcing drivers. This analysis finds a significant positive relationship between outsourcing alignment and performance for a number of competitive priorities. Finally, we use cluster analysis to develop a taxonomy of manufacturing strategies which are tested to determine the relationship between the alignment of outsourcing decisions and performance. The taxonomic investigation identifies three unique clusters of firms based on their competitive priorities and then determines alignment between each cluster strategy and outsourcing to be significantly associated with better performance. To the best of our knowledge, there are no studies in the literature that address the issue of strategic congruence between the outsourcing drivers and competitive priorities of a firm, and the impact of such congruence on firm performance.Ph.D.Committee Chair: Soumen Ghosh; Committee Member: Jeff Stratman; Committee Member: Lawrence James; Committee Member: Ravi Subramanian; Committee Member: Vinod Singha

Overcoming inertia : drivers of the outsourcing process

Almost all managers have directly or indirectly been involved in the practice of outsourcing in recent years. But as they know, outsourcing is not straightforward. Outsourcing inertia, when companies are slow to adapt to changing circumstances that accommodate higher outsourcing levels, may undermine a firm’s performance. This article investigates the presence of outsourcing inertia and the factors that help managers overcome it. Using statistical evidence, we show that positive performance effects related to outsourcing can accumulate when circumstances change. This is then followed by rapid increases in outsourcing levels (i.e. outsourcing processes). We investigate what gives rise to these outsourcing processes through follow-up interviews with sourcing executives, which suggest five drivers behind outsourcing processes: managerial initiative (using outside experience); hierarchy (foreign headquarters); imitation (of competitors and of similar firms); outsider advice (from external institutions); knowledge sources (using external information). These five drivers all offer scope for managerial action. We tie them to academic literatures and suggest ways of investigating their presence and impact on the outsourcing process. Overall, we conclude that while economizing factors play a key role in explaining how much firms outsource, it is socializing factors that tend to drive outsourcing processes

A Conceptual Framework of Reverse Logistics Impact on Firm Performance

This study aims to examine the reverse logistics factors that impact upon firm performance. We review reverse logistics factors under three research streams: (a) resource-based view of the firm, including: Firm strategy, Operations management, and Customer loyalty (b) relational theory, including: Supply chain efficiency, Supply chain collaboration, and institutional theory, including: Government support and Cultural alignment. We measured firm performance with 5 measures: profitability, cost, innovativeness, perceived competitive advantage, and perceived customer satisfaction. We discuss implications for research, policy and practice

Overcoming inertia : drivers of the outsourcing process

Almost all managers have directly or indirectly been involved in the practice of outsourcing in recent years. But as they know, outsourcing is not straightforward. Outsourcing inertia, when companies are slow to adapt to changing circumstances that accommodate higher outsourcing levels, may undermine a firm’s performance. This article investigates the presence of outsourcing inertia and the factors that help managers overcome it. Using statistical evidence, we show that positive performance effects related to outsourcing can accumulate when circumstances change. This is then followed by rapid increases in outsourcing levels (i.e. outsourcing processes). We investigate what gives rise to these outsourcing processes through follow-up interviews with sourcing executives, which suggest five drivers behind outsourcing processes: managerial initiative (using outside experience); hierarchy (foreign headquarters); imitation (of competitors and of similar firms); outsider advice (from external institutions); knowledge sources (using external information). These five drivers all offer scope for managerial action. We tie them to academic literatures and suggest ways of investigating their presence and impact on the outsourcing process. Overall, we conclude that while economizing factors play a key role in explaining how much firms outsource, it is socializing factors that tend to drive outsourcing processes

Environmental modelling of the Chief Information Officer

Since the introduction of the term in the 1980’s, the role of the Chief Information Officer (CIO) has been widely researched. Various perceptions and dimensions of the role have been explored and debated. However, the explosion in data proliferation (and the inevitable resulting information fuelled change) further complicates organisational expectations of the CIOs role. If organisations are to competitively exploit the digital trend, then those charged with recruiting and developing CIOs now need to be more effective in determining (and shaping) CIO traits and attributes, within the context of their own organisational circumstances and in line with stakeholder expectations. CIOs also need to determine their own suitability and progression within their chosen organisation if they are to remain motivated and effective. Before modelling the role of the future CIO, it is necessary to synthesise our current knowledge (and the lessons learnt) about the CIO. This paper, therefore, aims to identify and summate the spectrum of key researched ‘themes’ pertaining to the role of the CIO. Summating previous research, themes are modelled around four key CIO ‘dimensions’, namely (1) Impacting factors, (2) Controlling factors (3) Responses and (4) CIO ‘attributes’. Having modelled the CIOs current environment, and recognising the evolving IT enabled information landscape, the authors call for further research to inform the recruitment and development of the future CIO in terms of personal attributes and the measurable impact such attributes will have on their respective organisation

A framework for innovation outsourcing

This paper proposes a framework for the facilitation of organisational capability for outsourcing innovation, enabling firms to take advantage of its many benefits, (e.g., reduced costs, increased flexibility, access to better expertise and increased business focus), whilst mitigating its risks. In this framework a generic holistic model is developed to aid firms to successfully outsource innovation. The model is realised in two stages using a qualitative theory-building research design. The initial stage develops a preliminary model which is subsequently validated and refined during the second stage. The propositions which form the preliminary model are deductively explored to identify whether they also exist in a second data set. A semi-structured interview survey is executed with the aid of a rich picture survey instrument to gather data for this purpose. The model developed by this study describes innovation outsourcing as an open system of interrelated activities that takes established company strategy, (in terms of people, organisational structures, environment, and technology), and transforms it into improved firm performance through innovation. The model achieves this through a three-stage process which enables the alignment of capability to outsourced innovation activity, and makes actual performance outcomes, rather than expected benefits, the focus of innovation outsourcing aims

Globalisation of HR at Function Level: Exploring the Issues Through International Recruitment, Selection and Assessment Processes

Much of the debate around convergence-divergence is based around comparative analysis of HR systems. However, we need now to combine these insights with work in the field of IHRM on firm-level motivations to optimise, standardise and export HR models abroad. A series of the changes are being wrought on a range of IHRM functions – recruitment, global staffing, management development and careers, and rewards - by the process of globalisation highlighting the difference between globally standardised, optimised or localised HR processes. This paper reports on a study of firm-level developments in international recruitment, selection and assessment, drawing upon an analysis of four case studies each conducted in a different context. Organisations are building IHRM functions that are shifting from the management of expatriation towards supplementary services to the business aimed at facilitating the globalisation process, and this involves capitalising upon the fragmentation of international employees. As HR realigns itself in response to this process of within-function globalisation (building new alliances with other functions such as marketing and IS) the new activity streams that are being developed and the new roles and skills of the HR function carry important implications for the study of convergence and divergence of IHRM practice. Globalisation at firm level revolves around complexity, and this is evidenced in two ways: first, the range of theory that we have to draw upon, and the competing issues that surface depending on the level of analysis that is adopted; and second, the different picture that might emerge depending upon the level of analysis that is adopted. This paper shows that although the field of IHRM has traditionally drawn upon core theories such as the resource-based view of the firm, relational and social capital, and institutional theory, once the full range of resourcing options now open to IHRM functions are considered, it is evident that we need to incorporate both more micro theory, as well as insights from contingent fields in order to explain some of the new practices that are emerging

Outsourcing, Supplier Relations, and the External Span of Control

The outsourcing and supplier relations literature focuses primarily on initial designs while ignoring how superior implementation skills can drive competitive advantage. The concept of external span of control, defined as a firm’s overall capability to manage multiple and varying relations with outside suppliers, is put forward to capture implementation differences. Its antecedents are described and strategies are provided for improving it involving growth, alignment, internal development, and inter-firm learning.