Managing reversed (global) outsourcing – the role of knowledge, technology and time

Abstract

Purpose Against the recent trend toward reversed global outsourcing, the purpose of this paper is to provide insights on how the internal process can be handled once the decision on reverse outsourcing has been made. The authors focus in particular on in-house knowledge and technology requirements. Design/methodology/approach To explore the topic at hand, the researchers conducted in-depth semi-structured interviews with five companies operating in two different industry sectors. Findings Reversed outsourcing accentuates challenges relating to retained knowledge. When embarking on reversed outsourcing, companies need to acknowledge the effort to revive and renew capabilities in order to perform technical operations and advanced manufacturing production. Research limitations/implications The research is based on case studies in a Scandinavian context. Further empirical research from other high-cost locations is needed to validate the findings. Originality/value Explorative qualitative research is scarce in the emergent literature on reversed outsourcing. The paper provides practical and theoretical insights into how to handle diminishing knowledge in companies that are re-evaluating their sourcing strategies. It adds a knowledge dimension within the emergent literature. A framework for key success factors and propositions is also provided.

What do we want to know about reshoring? Towards a comprehensive framework based on a meta-synthesis

“…In fact, over time, the previous knowledge base in the home country might be diminished, and neglecting to evaluate the access to skills and knowledge can turn out to be a fatal error for reshoring implementation (Nujen and Halse 2017). In such a context, the management role in identifying existing competences and developing dynamic capabilities becomes fundamental (Nujen et al 2018a). Surprisingly, also articles with a focus far away from the preparation phase mention details that help in structuring its characteristics.…”

Technology transfer as a part of the business – inter-organizational transfer strategies based on experiences of aircraft production

“…Fredriksson and Johansson, 2009). Nujen et al (2018) have also shown that backshoring strategies are affected by how the capability gap have been dealt with during the outsourcing/offshoring period. Thus, going back to the discussion of the increasing transfers to subsidiaries and the backshoring trend, also for outsourcing/offshoring companies, there is a need to develop strategies for keeping an alignment between the motives of the decision and how to organise the realization.…”

“…the why (e.g. Fratocchi et al 2014;Stentoft et al, 2016;Fratocchi et al 2017;Nujen et al, 2018). However, the question of how to carry out the decision, i.e.…”

“…managing the inter-organizational technology transfer, have been less researched, especially from an organizational capability and readiness perspective, i.e. disseminative capacity (Nujen et al, 2018).…”

Reimagining Finland as a Manufacturing Base: The Nearshoring Potential of Finland in an Industry 4.0 Perspective

“…As the literature grows on reversal of offshoring decisions (e.g. Gylling, Heikkilä, Jussila, & Saarinen, 2015;Stentoft et al, 2016;Nujen et al, 2018), and as more attention is devoted to the bi-directionality of global movements of manufacturing activities (Vanchan, Mulhall, & Bryson, 2018) most research still focus on production either at home or far offshore. Research on moving or relocating production to the near-abroad has not received the same attention, even though empirical studies show evidence of trends towards 'regional rebalancing of value chains' (Backer et al, 2016) and high company interest in opportunities provided by nearshoring (Miebach Consulting, 2017).…”