Offshore Sourcing in Software Development: Case Studies of Finnish-Russian Cooperation

The study examines international cooperation in product development in software development organisations. The software industry is known for its global nature and knowledge-intensity, which makes it an interesting setting to examine international cooperation in. Software development processes are increasingly distributed worldwide, but for small or even medium-sized enterprises, typical for the software industry, such distribution of operations is often possible only in association with crossing the company’s boundaries. The strategic decision-making of companies is likely to be affected by the characteristics of the industry, and this includes decisions about cooperation or sourcing. The objective of this thesis is to provide a holistic view on factors affecting decisions about offshore sourcing in software development. Offshore sourcing refers to a cooperative mode of offshoring, where a firm does not establish its own presence in a foreign country, but utilises a local supplier. The study examines product development activities that are distributed across organisational and geographical boundaries. The objective can be divided into two subtopics: general reasons for international cooperation in product development and particular reasons for cooperation between Finnish and Russian companies. The focus is on the strategic rationale at the company level, in particular in small and medium-sized enterprises. The theoretical discourse of the study builds upon the literature on international cooperation and networking, with particular focus on cooperation with foreign suppliers and within product development activities. The resource-based view is also discussed, as heterogeneity and interdependency of the resources possessed by different firms are seen as factors motivating international cooperation. Strategically, sourcing can be used to access resources possessed by an industrial network, to enhance the product development of a firm, or to optimise its cost structure. In order to investigate the issues raised by the theoretical review, two empirical studies on international cooperation in software product development have been conducted. The emphasis of the empirical part of the study is on cooperation between Finnish and Russian companies. The data has been gathered through four case studies on Finnish software development organisations and four case studies on Russian offshore suppliers. Based on the material from the case studies, a framework clarifying and grouping the factors that influence offshore sourcing decisions has been built. The findings indicate that decisions regarding offshore sourcing in software development are far more complex than generally assumed. The framework provides a holistic view on factors affecting decisions about offshore sourcing in software development, capturing the multidimensionality of motives for entering offshore cooperation. Four groups of factors emerged from the data: A) strategy-related aspects, B) aspects related to resources and capabilities, C) organisation-related aspects, and D) aspects related to the entrepreneur or management. By developing a holistic framework of decision factors, the research offers in-depth theoreticalunderstanding of offshore sourcing rationale in product development. From the managerial point of view, the proposed framework sums up the issues that a firm should pay attention to when contemplating product development cooperation with foreign suppliers. Understanding different components of sourcing decisions can lead to improved preconditions for strategising and engaging in offshore cooperation. A thorough decisionmaking process should consider all the possible benefits and risks of product development cooperation carefully.

Geographical Studies of Underwater Light Dynamics in the Coastal Archipelago of SW Finland, Baltic Sea

The underwater light field is an important environmental variable as it, among other things, enables aquatic primary production. Although the portion of solar radiation that is referred to as visible light penetrates water, it is restricted to a limited surface water layer because of efficient absorption and scattering processes. Based on the varying content of optical constituents in the water, the efficiency of light attenuation changes in many dimensions and over various spatial and temporal scales. This thesis discusses the underwater light dynamics of a transitional coastal archipelago in south-western Finland, in the Baltic Sea. While the area has long been known to have a highly variable underwater light field, quantified knowledge on the phenomenon has been scarce, patchy, or non-existent. This thesis focuses on the variability in the underwater light field through euphotic depths (1% irradiance remaining), which were derived from in situ measurements of vertical profiles of photosynthetically active radiation (PAR). Spot samples were conducted in the archipelago of south-western Finland, mainly during the ice-free growing seasons of 2010 and 2011. In addition to quantifying both the seasonal and geographical patterns of euphotic depth development, the need and usability of underwater light information are also discussed. Light availability was found to fluctuate in multiple dimensions and scales. The euphotic depth was shown to have combined spatio-temporal dynamics rather than separate changes in spatial and temporal dimensions. Such complexity in the underwater light field creates challenges in data collection, as well as in its utilisation. Although local information is needed, in highly variable conditions spot sampled information may only poorly represent its surroundings. Moreover, either temporally or spatially limited sampling may cause biases in understanding underwater light dynamics. Consequently, the application of light availability data, for example in ecological modelling, should be made with great caution.