A Decisional Framework of Offshoring: Integrating Insights from 25 Years of Research to Provide Direction for Future*

Abstract

Mirroring the growing trend for firms to support their operations by locating activities abroad, research on the practice of offshoring has increased considerably in recent years. However, despite the mounting research, understanding of the key factors influencing decision-making for offshoring remains surprisingly limited due to fragmentation. In this study, we synthesize and integrate insights from different research domains in order to develop a comprehensive decisional framework for key offshoring decisions. The integrative decisional framework is based on a systematic review of offshoring research published in the most influential management and business journals in the past 25 years. In addition to providing a snapshot of the state of research on decision-making for offshoring, this study aims to stimulate future research by identifying promising research opportunities. In particular, we propose that future research should use alternative theories to incorporate overlooked aspects of decision-making, integrate different theories to account for the interdependencies between decisions, and adopt a portfolio perspective that considers each decision as part of an overall offshoring strategy.

A Systematic Literature Review on Recent Lean Research: State‐of‐the‐art and Future Directions

“…As recognized by many authors (e.g. Mihalache and Mihalache ; Spina et al . ; Wang and Chugh ), this method has numerous advantages compared with traditional unstructured reviews.…”

“…Kunisch et al . ; Mihalache and Mihalache ). Moreover, SLR is a versatile approach, adopted in recent studies published in high‐quality scientific journals on different research topics, for example purchasing and SCM (Chicksand et al .…”

“…, p. 209) that allows: (1) minimization of bias and errors (Tranfield et al . ); (2) improvement in the quality of the review process and outcomes (Mihalache and Mihalache ); (3) confirmation of their validity through the replication of clear steps during the review process (Wang and Chugh ); and (4) synthesizing and organizing the literature accumulated in a specific field (Wang and Chugh ), often providing academics and practitioners with frameworks of the existing knowledge (e.g. Kunisch et al .…”

OM Forum—Benchmarking Global Production Sourcing Decisions: Where and Why Firms Offshore and Reshore

“…The study of manufacturing sourcing has generated a vast literature with contributions from multiple disciplines. See Mihalache and Mihalache (2016) for a recent review of the past 25 years of academic research in this area.…”

Manufacturing relocation through offshoring and backshoring: the case of Sweden

“…A number of theories have been used, from both economics and international business literature, to explain why firms relocate their manufacturing. Two of the most common theories to explain offshoring decisions are the transaction cost economics (TCE) and the resource-based view (RBV ), according to a literature review by Mihalache and Mihalache (2016). Both are concerned with the make-or-buy decision, but while TCE focusses on the cost perspective, RBV deals with the search for a competitive advantage (McIvor, 2013;Mihalache and Mihalache, 2016).…”