Linking outsourcing to business strategy

In today's business environment, companies are driven to conduct a few functions inhouse and to obtain the rest from other sources through aggressive outsourcing. While outsourcing may seem attractive at the strategic management level, serious pitfalls are often encountered as the strategy is p...

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Bibliographic Details
Published in:Academy of Management perspectives 2000-11, Vol.14 (4), p.58-70
Main Authors: Insinga, Richard C., Werle, Michael J.
Format: Article
Language:English
Subjects:
Advantages
Competitive advantage
Disadvantages
Human resources
Outsourcing
Strategic management
Strategic planning
Studies
Virtual corporations
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Summary:In today's business environment, companies are driven to conduct a few functions inhouse and to obtain the rest from other sources through aggressive outsourcing. While outsourcing may seem attractive at the strategic management level, serious pitfalls are often encountered as the strategy is pushed downward into operations. As the operational level, the strategic intent tends to be lost in a hectic day-to-day, problem-to-problem business environment. Outsourcing decisions made at the operational level can easily lead to dependencies that create unforeseen strategic vulnerabilities. These pitfalls are addressed by a systematic methodology that can guide the operational level to achieve strategically appropriate actions.
ISSN:1558-9080
1943-4529
DOI:10.5465/ame.2000.3979816