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PurposeThis paper aims to present a managerial framework that facilitates successful supplier selection and ongoing management for purchasing services from offshore suppliers.Design/methodology/approachThis research is grounded in transaction cost theory and developed using data from case studies of six Fortune 500 firms that have a minimum of three years experience purchasing services from suppliers located in India.FindingsViewing the selection and management of suppliers for the purchase of offshore outsourced services as strategic in nature helps organizations ensure quality and low cost in the service delivery and also reduces complexity and associated risk to the organization.Research limitations/implicationsThe overarching limitation is the number and size of the companies being researched.Practical implicationsThis research presents a framework to guide managers in reducing risk and improving performance in these complex service purchases. Formalizing the selection and management of offshore outsourced services and investing in supplier improvements/measurement was found to improve operating relationships and enhance the business‐to‐business relationship.Originality/valueThis research provides a supply management perspective on a relatively new phenomenon. There has been little academic research on business process offshoring and few theoretical insights to guide managers in the purchase of services from suppliers located in different geographies with different cultures and operating structures. This paper looks at this phenomenon from a US‐based perspective and provides guidelines for managers.

In an effort to achieve a competitive advantage via cost reductions and improved market responsiveness, organizations are increasingly employing offshore outsourcing as a major component of their supply chain strategies. But as evident from literature number of risks such as Political risk, Risk due to cultural differences, Compliance and regulatory risk, Opportunistic risk and Organization structural risk, which adversely affect the performance of offshore outsourcing in a supply chain network. This also leads to dissatisfaction among different stake holders. The main objective of this paper is to identify and understand the mutual interaction among various risks which affect the performance of offshore outsourcing. To this effect, authors have identified various risks through extant review of literature. From this information, an integrated model using interpretive structural modelling (ISM) for risks affecting offshore outsourcing is developed and the structural relationships between these risks are modeled. Further, MICMAC analysis is done to analyze the driving power and dependency of risks which shall be helpful to managers to identify and classify important criterions and to reveal the direct and indirect effects of each criterion on offshore outsourcing. Results show that political risk and risk due to cultural differences are act as strong drivers.

[EN] In an effort to achieve a competitive advantage via cost reductions and improved market responsiveness, organizations are increasingly employing offshore outsourcing as a major component of their supply chain strategies. But as evident from literature number of risks such as Political risk, Risk due to cultural differences, Compliance and regulatory risk, Opportunistic risk and Organization structural risk, which adversely affect the performance of offshore outsourcing in a supply chain network. This also leads to dissatisfaction among different stake holders. The main objective of this paper is to identify and understand the mutual interaction among various risks which affect the performance of offshore outsourcing. To this effect, authors have identified various risks through extant review of literature. From this information, an integrated model using interpretive structural modelling (ISM) for risks affecting offshore outsourcing is developed and the structural relationships between these risks are modeled. Further, MICMAC analysis is done to analyze the driving power and dependency of risks which shall be helpful to managers to identify and classify important criterions and to reveal the direct and indirect effects of each criterion on offshore outsourcing. Results show that political risk and risk due to cultural differences are act as strong drivers. ; Kumar, S.; Sharma, RK.; Chauhan, P. (2014). ISM Approach to Model Offshore Outsourcing Risks. International Journal of Production Management and Engineering. 2(2):101-111. doi:10.4995/ijpme.2014.2096 ; SWORD ; 101 ; 111 ; 2 ; 2 ; Aron, R., Bandyopadhyay, S., Jayanty, S., & Pathak, P. (2007). Monitoring process quality in off-shore outsourcing: A model and findings from multi-country survey. Journal of Operations Management, 26(2), 303-321. doi:10.1016/j.jom.2007.02.014 ; Aron, R., Clemons, E. K., & Reddi, S. (2005). Just Right Outsourcing: Understanding and Managing Risk. Journal of Management Information Systems, 22(2): 37-55. ; Aron, R., ...

Outsourcing-Offshoring ist zum Dauerthema geworden. Doch wird inzwischen nicht mehr diskutiert, ob überhaupt ausgelagert werden solle, sondern welche Art von IT-Prozessen hierfür infrage kommen und welche Länder sich aus welchen Gründen für ein Outsourcing anbieten. Klar ist, dass nicht nur aufgrund der räumlichen Distanz hochspezifische, geschäftskritische Aufgaben, sowie solche, die regelmäßige Rückfragen und Änderungen erfordern, ausgeschlossen sind. Übrig bleiben Prozesse, die standardisiert, klar strukturiert, modular und in der Zusammenarbeit einfach zu handhaben sind. Beim Offshoring sind außer-dem länderspezifische, politische, rechtliche, kulturelle und sprachliche Barrieren zu berücksichtigen. Neu an der aktuellen Offshoring-Diskussion ist, dass zunehmend hoch qualifizierte Tätigkeiten betroffen sind.

This paper is meant to provide a general overview of the subject of offshore outsourcing in America. The debate over offshore outsourcing has been triggered by the increasing trade deficit and steep decline in manufacturing employment over the latest business cycle. Furthermore, as technological advances allow for service functions to relocate abroad, a larger segment of workers are now faced with international competition. Most studies find that the current level of offshore outsourcing of services is benign compared to the net job creation in America. Estimates show that in the longer run, as many as 14 million service jobs are in danger. In manufacturing, still more areas are being affected by foreign competition. The offshore outsourcing of jobs and functions increases productivity and has a tendency to increase demand for higherskilled labour. It also lowers prices particularly benefiting lower-income families. On an aggregate basis, it provides America with a net gain. However, there is a growing concern that offshore outsourcing does not only imply transitional costs as the economy undergoes structural change, but that it creates a permanent downwards pressure on wages for many groups in competition with cheaper labour overseas. This entails more focus on the needs for adult training and education. Free world trade remains a precondition for globalisation and the exploitation of international division of labour. At both federal and state level of government, there is a trend towards more protectionism. The Chinese peg to the dollar and the opening of overseas markets for American goods and services have taken centre-stage.

Offshore outsourcing of business processes is a rapidly increasing global phenomenon that requires a greater reliance on the effective development of strategic alliances and inter-firm relationships. The stakeholders involved in these service purchases influence the success or failure of the buyer-supplier relationship. This article examines the key stakeholders involved in the offshore outsourcing of services, determines what expectations these stakeholders hold, and assesses how a buying firm and the offshore supplying firm work together to meet these expectations. The case research method is used to address this phenomenon by studying six U.S.-based, Fortune 500 firms involved in offshore outsourcing of services. These buying organizations initially experienced more complexity than anticipated in engaging with offshore suppliers in outsourcing relationships. To achieve success with these relationships, the buying organizations needed to embrace cultural differences, including the needs of their suppliers' employees.

PurposeThe purpose of this paper is: to determine how offshore outsourcing firms in the USA are involved in providing assistance to education and training the downsized/unemployed; and to conduct inter‐industry comparisons among offshore outsourcing firms to determine if there are differences in their degree of involvement in assisting education and training the downsized/unemployed.Design/methodology/approachThis research is based on a survey of 51 firms in the USA that are listed as major offshore outsourcers and exporters of American jobs in "CNN's Lou Dobbs Exporting America website".FindingsThe findings show that out of eight areas of corporate social activities included in the survey, offshore outsourcing firms indicated that they were least involved in providing or supporting training programs to the downsized/unemployed. However, we also found that offshore outsourcing firms were highly involved in providing assistance to charities and supporting private and public education.Research limitation/implicationsThe response rate in this survey was similar to other response rates for research conducted on similar topics. However, the sample size for the study is relatively small and results from larger sample sizes are required to make empirical generalizations with confidence.Practical implicationsThe findings of this study are useful for USA policy makers who are dealing with the negative effects of offshoring. It also provides direction to offshoring firms on how to alleviate negative attitudes toward offshore outsourcing.Originality/valueThe paper is the first to investigate the contributions of offshore outsourcing firms to education and training the downsized/unemployed as part of their corporate social responsibility. Thus, it makes a significant contribution to the literature.

The wage and employment effects of offshoring roil politics in the United States and around the world. Firms that offshore either outsource their activities to unaffiliated businesses, or internalize production by establishing subsidiaries from which they import intrafirm. We argue that the political environment in trade partner countries influences U.S. offshoring patterns in ways that have been ignored in the extant literature. Drawing on the political business cycle literature, we expect higher production costs and lower profits for firms in capital (labor) intensive sectors when the Left (Right) is in power. These partisan cycles, in turn, shape the sectoral composition of exports from the partner to the United States, and the degree to which trade is conducted intrafirm. Under a Left‐ (Right‐) leaning government in a partner country, U.S. intrafirm imports of capital‐ (labor‐) goods increase relative to total imports in these industries. Examining highly disaggregated U.S. import data, we find strong support for our argument. Our results indicate that the effect of partisan governments on offshore outsourcing depends on factor intensities of production, which vary across industries. The degree of internalization in global sourcing is shaped in part by the distributional objectives of partisan governments, and not by economic factors alone.