ISM Approach to Model Offshore Outsourcing Risks

Abstract

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 act as strong drivers.

ISM approach to model financial risks in Indian KPO organization

“…This matrix employs the principles of matrix multiplication and is commonly referred to as MICMAC analysis. The main objective of using a cross-impact matrix approach is to categorize all parameters based on their driver power and dependency (Govindan et al, 2012;Kumar et al, 2014;Chauhan et al, 2015), as demonstrated in Figure 5. In the current study, the financial risk factors have been classified into four categories, as outlined in Table 9, according to their driver power and dependency.…”

“…While there is still a lack of understanding regarding how internal and external knowledge integration impacts innovation within KPO firms, it is crucial for these firms to address challenges such as domain expertise, location advantage, regulatory compliance, and risk management to maintain a competitive edge (Liu, 2019;Sayed and Agndal, 2021). Organizations adopt outsourcing operations and implement new systems engineering to create work capabilities and adapt to the global village concept and technological discontinuities (Kumar et al, 2014). Although there are potential challenges, both the business process outsourcing (BPO) and KPO sectors hold significant potential (Umarova, 2022).…”

Thermal Fatigue

“…Typical spraying parameters are given in Table 16. 3. In this Table CEA and KFA refer to the nuclear facilities in Saclay (i,.e CEA) and Jūlich (KFA), respectively.…”

Probabilistic risk analysis in manufacturing situational operation: application of modelling techniques and causal structure to improve safety performance.

“…Risks dversely affect the performance of offshore industry. The understanding of the mutual interaction among various risks, which affect the performance of the offshore outsourcing, is crucial (Kumara et al, 2014). The same approach applies to jet engines manufacturing industry.…”