Management Outsourcing Business Models: A perspective of Sustainability

Abstract

ACKNOWLEDGMENTSI would like to start from thanking my supervisor, Professor Carlos Jerónimo, for all the support provided, availability, encouragement, guidance, and knowledge shared throughout this whole process. More than a professor, Professor Carlos Jerónimo represents a mentor to me, who is a reference and an inspiration for my professional life.A genuine thank you to my parents and brother, who have always supported me during my path as a management student, being always present to give me encouragement, motivation and provide good energies and so much love. You are the biggest loves of my life. A very special thank you to my boyfriend Hugo, for all the weekends and working days we spent together, always supporting each other, helping each other, encourage each other, motivate each other, and laugh with each other. I love you. To my lovely family, a huge thank you for always being on my side to support me and demonstrate the pride you have on me. To my shining star, who would be so proud to watch me accomplish this achievement, you truly have been a big strength throughout my life and I want to dedicate this to You, my dear grandpa.To my colleagues from ISCTE, that more than colleagues we become true friends, we were all together in this journey, and I am so proud of us for this achieving.To my dear friends, despite I haven't spent much time with you this last year, thank you for supporting me and give me strength, and especially for you friendship.Last but not least, the development of this dissertation was only possible with the participation and contribution of the management professionals. To all of you, who have such a busy life and welcomed me with so much empathy and responsiveness, I would like to express my genuine gratitude.A truly thank you all! ii SUMMARY In a world characterized by intense competition, outsourcing has infiltrated the management world in a major way. Outsourcing services are becoming an increasingly important source to companies focus on their core competencies, reduce costs, and increase efficiency in several organizational functions.Even though outsourcing of business activities has become a prevalent practice amongst organizations, the literature provides only a one-dimensional view of the phenomenon by focusing on the service receivers' perspectivesbuyer.This dissertation overcomes this weakness by investigate and analyze the business models of outsourcing companiesvendor -as a way to understand how they reach a sustainable competitive advantage that differentiates them in a competitive market. Hence, the whole investigation explores the service provider's perspectives by conducting interviews to 16 top executives from 15 different outsourcing companies in Portugal.The findings suggest that all the organizations presented in the study face the same challenges/pains in the market and each of them manifest an exclusive combination of mechanisms, methods, strategies and approaches within their business models to be differentiated in the market and sustainable in terms of effici...

Service Design From Staffing to Outsourcing

“…According to the literature, outsourcing is not a recent concept, and it originated in the 1970s / 80s when organisations redirected vertical strategic thinking, where the focus was on core competencies and outsourcing other low value activities and products added to the primary objective of reducing costs and gaining control over various companies (Bhattacharya et al, 2012;Dolgui & Proth, 2013;Jeronimo et al, 2019;Mella & Pellicelli, 2012). In the 1990s, with the confidence that competitive advantages came from cost savings, many companies began to focus on core activities by reengineering and redesigning business processes and outsourcing all secondary activities, even products and services with higher value-added (Dolgui & Proth, 2013;Glaa et al, 2014).…”

“…For Choi et al (Choi et al, 2018), the value of outsourcing is higher under more uncertain conditions. Those in favour of outsourcing emphasise, from a buyer's perspective, improved performance as a result of increased strategic focus, valuable flexibility to scale or retreat in adverse scenarios with limited cost, shared risk, lower outsourcing production costs through lower cost suppliers and bureaucratic cost savings or relational incomes (Choi et al, 2018;D, Lopesa Costa & António, 2011;Jeronimo et al, 2019;Mella & Pellicelli, 2012). Also noteworthy are some weaknesses that may arise from this type of service, opportunistic supplier behaviour, increased transaction and coordination costs, loss of core competencies, risk of intellectual capital leakage, loss of quality and differences in traditions, culture and values (Choi et al, 2018;Modak et al, 2019;Munjal et al, 2018;Stanko & Olleros, 2013).…”