Global Production Networks, Offshore Services and the Branch-Plant Syndrome

Abstract

KLEIBERT J. M. Global production networks, offshore services and the branch-plant syndrome, Regional Studies. This article combines the global production network (GPN) framework with the branch-plant economy literature to generate a set of indicators for a more nuanced understanding of the outcomes of foreign direct investment attraction for recipient regions. It adapts both literatures to the case of offshore services and empirically maps the position and power relations of business process outsourcing branch offices in the Philippines. A multi-sited case study shows the variegated outcomes of foreign branch office development. In particular, second-tier cities are characterized by a dependent position in the international division of labour, confirming some ideas of the branch-plant syndrome. Global production networksForeign direct investment Branch plants Business process outsourcing PhilippinesKLEIBERT J. M. Les réseaux de production mondiaux, les services offshore et le syndrome des établissements mutiples, Regional Studies. L'article combine le cadre des réseaux de production mondiaux avec la documentation sur l'économie d'établissements multiples afin d'engendrer un ensemble d'indicateurs dans le but de fournir une compréhension plus nuancée des résultats de l'attraction de l'investissement direct étranger aux zones d'accueil. On applique la documentation à l'étude de cas des services offshore et trace de façon empirique la position et les relations de pouvoir des établissements qui externalisent les processus opérationnels aux Philippines. Une étude de cas multi-sites montre les divers résultats du développement des établissements à l'étranger. En particulier, les grandes villes de deuxième rang se caractérisent par une position de dépendance dans la division internationale du travail, ce qui confirme certaines idées quant au syndrome des établissements multiples. Réseaux de production mondiaux Investissement direct étranger Établissements multiples Externalisation des processus opérationnels Philippines KLEIBERT J. M. Globale Produktionsnetzwerke, Offshore-Dienste und das Syndrom der Auslandsfilialen, Regional Studies. In diesem Artikel wird die Literatur des Rahmens des globalen Produktionsnetzwerks mit der Literatur über die Ökonomie der Auslandsfilialen kombiniert, um eine Reihe von Indikatoren für ein verfeinertes Verständnis der Ergebnisse des Zuflusses von ausländischen Direktinvestitionen für die Empfängerregionen zu erzeugen. Hierfür werden beide Literaturen an den Fall der Offshore-Dienste angepasst und die Position und Machtbeziehungen von Auslandsfilialen zum Outsourcing von Geschäftsprozessen in den Philippinen empirisch kartiert. Anhand einer Fallstudie mit mehreren Standorten werden die vielfältigen Ergebnisse der Entwicklung von Auslandsfilialen aufgezeigt. Insbesondere zeichnen sich Sekundärstädte in der internationalen Arbeitsteilung durch eine abhängige Position aus, was einige Bedenken des 'Auslandsfilialen-Syndroms' bestätigt. Globale Produktionsnetzwerke Ausländische Direktinvestiti...

The Domestic Turn: Business Process Outsourcing and the Growing Automation of Kenyan Organisations

“…This tendency might cushion the country from external shocks and thus prevent it from developing into a branch-plant economy dependent on fleet-footed multinational companies (Phelps, 2008;MacKinnon, 2012;Kleibert, 2015). These frontward and backward linkages decrease the likelihood that foreign investment will move elsewhere when costs change.…”

The dark side of regional industrial path development: towards a typology of trajectories of decline

“…Generally, delocalization has been enhanced by a growing 'footlessness', especially of some manufacturing industries and services (such as voice-based and back-office services) in the contemporary globalized economy, and by the increase in vertical fragmentation of the production process, which has led to a widespread formation of global production networks in manufacturing as well as in services (e.g. Coe, 2014;Dörry, 2015;Flecker & Schönauer, 2016;Kleibert, 2016). Offshore services such as various voice-based, backoffice services and software development are particularly footloose due to low sunk costs as well as due to limited local linkages (Hardy & Hollinshead, 2016;Kleibert, 2016).…”

Revisiting the multinational enterprise in global production networks

“…Secondly, while the MacKinnon (2011) framework presents an important advance by emphasising the relationship between GPNs and forms of institutional change in processes of coupling, there remains a dearth of explanation for the causal internal corporate practices influencing 'selection', coupling/de-coupling and institutional change as part of firm strategies (see Dawley, 2011), and as evidenced in empirical studies of coupling (e.g. Horner, 2014;Kleibert, 2016). This relates more broadly to Murphy's (2012) concern that GPN analysis lacks appreciation of the role of agency and practices, and the intricacies of power relations, by which firms interact with regions.…”

“…This relates more broadly to Murphy's (2012) concern that GPN analysis lacks appreciation of the role of agency and practices, and the intricacies of power relations, by which firms interact with regions. For instance, the 'selection' perspective of MacKinnon (2011) brings the role of agency to the fore, but there can usefully be a deeper analysis of this process, taking account of processes of selection rather than viewing them as an end result (see Kleibert, 2016).…”

“…Phelps et al, 1998). More recently, Kleibert (2016) argues that elements of the 'branch plant syndrome' within vertically orientated offshoring remain important, typically because they lack decision-making powers.…”