Offshoring of Services: A Review of the Literature and Organizing Framework

Abstract

Offshoring of services (OS), commonly defined as the international relocation of service activities that companies previously performed in their home country, has emerged as a relevant phenomenon in international business (IB). Over the past two decades, OS has grown rapidly in the global economy and it has increasingly attracted IB scholars' attention. In this study, we systematically review the literature to map and assess the body of IB research focused on the OS phenomenon. To achieve our goal, we identify and analyze a total of 79 studies that appeared from 1990 to 2014 in a select group of 14 journals that are widely considered leading publishers of IB research. This review seeks to make a threefold contribution to the IB discipline. First, it provides an in-depth analysis of the OS literature through a synthesis of the theoretical perspectives adopted and an assessment of the empirical findings obtained. Second, it offers an organizing framework that contributes to a more nuanced understanding of the OS phenomenon. Third, it identifies emerging topics on the OS frontier and suggests potential avenues for future research.

Accounting for firm heterogeneity in global value chains

“…NOTES 1 Various terms have been coined to discuss and contextualize this important feature of economic globalization -e.g., ''global factory'' (Buckley, 2011), ''global supply chains,'' and ''offshoring'', to name a few. For a comprehensive review of studies on the offshoring of service activities, see e.g., Pisani and Ricart (2016). 2 We emphasize here that these three research tools present important differences amongst themselves and can be used, in combination or separately, to address a variety of research questions.…”

Nearshore Service Transfers in the EU: Legal and Economic Issues

“…In a broad perspective, it reasserts the global turn towards the servicization of Polish economy (Lichniak, 2010). Offshore services may include a wide spectrum of activities, ranging from medical transcription to software development (Pisani, Ricart, 2016). Even though initially business process offshoring referred mainly to manufacturing goods, over the last few years, the production of physical objects offshore has been superseded by the services offshoring, due to the growing demand for the advanced administrative and technical corporate processes (Metters and Verma, 2008 Business offshoring has been a widely implemented corporate strategy, aiming mainly for creating and maintaining sustainable competitive advantage (Ferdows, 1997), The facilitation of international service transfers is often stipulated by multiple reasons, creating both opportunities and challenges for various industries, (Hummels et al, 2012).…”

Services Offshoring: A Microfoundations Perspective

“…Overall, existing research on strategic firm-level services offshoring attributes suggests that services offshoring includes many motives apart from cost reduction, especially where the need for a skilled workforce becomes paramount as in the case of advanced services offshoring. Accordingly, services offshoring outcomes can be classified into two subgroups by the outcomes sought: (a) organizational performance outcomes and (b) capabilities, resources and processes, as an aftermath of offshoring strategy implementation [6,39]. These outcomes are relevant to the various strategic attributes of service offshoring discussed above, namely the motive to achieve cost efficiency, access to skilled work, or access to new markets, which can also be called intended outcomes.…”

“…For over a decade, the services offshoring phenomenon has attracted the attention of practitioners [1], scholars [2] and policy makers [3]. Services offshoring refers to the transnational transfer of service activities to foreign destinations in captive, collaborative or outsourced governance modes [4][5][6][7]. Compared to offshoring of production activities, services offshoring depends more on individual organizational members' knowledge, skills and competences (i.e.…”

“…However, the focus of most extant research into services offshoring is pitched at the firm level of analysis rather than at individual actors and teams (i.e. the micro level of analysis), and we know little about the links between the micro and macro levels [6]. We therefore argue that a comprehensive synthesis is needed to understand the link between the macro and micro levels of analysis and to support our understanding of how micro-level processes aggregate into services offshoring strategy outcomes.…”