Latin America’s emergence in global services A new driver of structural change in the region?

Includes bibliography.

Information Systems Outsourcing. Enduring themes, global challenges, and process opportunities

he notion of outsourcing – making arrangements with an external entity for the provision of goods or services to supplement or replace internal efforts – has been around for centuries. The outsourcing of information systems (IS) is however a much newer concept but one which has been growing dramatically. This book attempts to synthesize what is known about IS outsourcing by dividing the subject into three interrelated parts: (1) Traditional Information Technology Outsourcing, (2) Information Technolgy Offshoring, and (3) Business Process Outsourcing. The book should be of interest to all academics and students in the field of Information Systems as well as corporate executives and professionals who seek a more profound analysis and understanding of the underlying factors and mechanisms of outsourcing.

Knowledge transfer in software-maintenance offshore outsourcing

Software-maintenance offshore outsourcing (SMOO) projects have been plagued by tedious knowledge transfer during the service transition to the vendor. Vendor engineers risk being over-strained by the high amounts of novel information, resulting in extra costs that may erode the business case behind offshoring. Although stakeholders may desire to avoid these extra costs by implementing appropriate knowledge transfer practices, little is known on how effective knowledge transfer can be designed and managed in light of the high cognitive loads in SMOO transitions. The dissertation at hand addresses this research gap by presenting and integrating four studies. The studies draw on cognitive load theory, attributional theory, and control theory and they apply qualitative, quantitative, and simulation methods to qualitative data from eight in-depth longitudinal cases. The results suggest that the choice of appropriate learning tasks may be more central to knowledge transfer than the amount of information shared with vendor engineers. Moreover, because vendor staff may not be able to and not dare to effectively self-manage learn-ing tasks during early transition, client-driven controls may be initially required and subsequently faded out. Collectively, the results call for people-based rather than codification-based knowledge management strategies in at least moderately specific and complex software environments.

Explaining Variations in Client Extra Costs between Software Projects Offshored to India

Gaining economic benefits from substantially lower labor costs has been reported as a major reason for offshoring labor-intensive information systems services to low-wage countries. However, if wage differences are so high, why is there such a high level of variation in the economic success between offshored IS projects? This study argues that offshore outsourcing involves a number of extra costs for the ^his paper was recommended for acceptance by Associate Guest Editor Erran Carmel. client organization that account for the economic failure of offshore projects. The objective is to disaggregate these extra costs into their constituent parts and to explain why they differ between offshored software projects. The focus is on software development and maintenance projects that are offshored to Indian vendors. A theoretical framework is developed a priori based on transaction cost economics (TCE) and the knowledge-based view of the firm, comple mented by factors that acknowledge the specific offshore context The framework is empirically explored using a multiple case study design including six offshored software projects in a large German financial service institution. The results of our analysis indicate that the client incurs post contractual extra costs for four types of activities: (1) re quirements specification and design, (2) knowledge transfer, (3) control, and (4) coordination. In projects that require a high level of client-specific knowledge about idiosyncratic business processes and software systems, these extra costs were found to be substantially higher than in projects where more general knowledge was needed. Notably, these costs most often arose independently from the threat of oppor tunistic behavior, challenging the predominant TCE logic of market failure. Rather, the client extra costs were parti cularly high in client-specific projects because the effort for managing the consequences of the knowledge asymmetries between client and vendor was particularly high in these projects. Prior experiences of the vendor with related client projects were found to reduce the level of extra costs but could not fully offset the increase in extra costs in highly client-specific projects. Moreover, cultural and geographic distance between client and vendor as well as personnel turnover were found to increase client extra costs. Slight evidence was found, however, that the cost-increasing impact of these factors was also leveraged in projects with a high level of required client-specific knowledge (moderator effect).

Ofshoring de servicios en la economía española en el periodo 2000-2007

La literatura económica ha centrado la atención en el offshoring de servicios y en su efecto sobre el nivel de empleo nacional, unido a importantes críticas en relación al impacto negativo que esta estrategia provoca en términos de destrucción de empleos nacionales. En este trabajo se analiza la relevancia que tiene el offshoring de servicios en la economía española y, en concreto, en las ramas de servicios y se estudia su efecto sobre el nivel de empleo de este sector. El análisis empírico se lleva a cabo estimando una función de demanda de trabajo con elasticidad de sustitución constante (CES), incluyendo en la misma el efecto de offshoring. Este estudio se realiza para el periodo previo a la crisis, 2000-2007, a partir de los datos contenidos en las Tablas Input-Output de la Contabilidad Nacional del INE.

Europe's exports superstar - it's the organisation! Bruegel Working Paper 2015/05, 15 July 2015

What explains Germany’s superb export performance? Is Germany’s export behaviour very distinct compared to other European countries? The authors explore the organisational responses to competition of 14,000 exporting firms in seven European countries. The paper examines the export business model of the median exporter and of the top one percent exporters in each country, accounting for 20 percent to 55 percent of total exports. What do these firms do to become superstars? The authors find, first, that the export market share of the median exporter in each of the countries to the world more than tripled (in some cases the export market share increases tenfold) for firms that combine decentralised management with offshoring of production to low-wage countries. Exporters which abstain from any organisational adjustment do very badly. Decentralised management provides incentives for workers for product improvements allowing exporters to compete on quality. Offshoring production to low-wage countries reduces costs allowing exporters to compete on price. Second, we find that Germany is the leading quality exporter in Europe followed by Austria and Spain. Among the top 10 percent of exporters there is no single firm with low quality in Germany and Austria, which suggest that decentralised management has provided incentives for quality in these countries. Third, Germany’s exports are less vulnerable to price increases, while exports from France and Italy respond strongly to price changes, and thus costs reductions via offshoring benefits these countries most.

Multinational firms, productivity and employment

Over the last three decades foreign direct investment (FDI) has become the most visible driver of globalisation. It has grown faster than world output and international trade and now reports world annual flows exceeding 1,000 billion US dollars. In this period, Germany has undergone significant changes in order to play an important role in the globalisation process. Apart from being a member state of the European Union (EU) whose key feature is the free flow of trade, investment and labour, the re-unification of East and West Germany in 1990 has been a significant development. This in effect has meant that East Germany as well as other Eastern European nations opened up to foreign investment for the first time. In this period, Germany has attracted in excess of 10 per cent of inward FDI into the EU and invested around 15 per cent of all FDI in the EU. This thesis explores empirically the potential impact of FDI on firms operating in and investing from Germany over a ten year period. Using panel data at the firm-level it concentrates on three areas relating to FDI. Firstly, it considers whether foreign-owned firms are more productive than German multinational firms and German non-multinational firms. Secondly, the thesis considers the impact of German investments abroad on domestic productivity. Finally, employment effects emanating from outward high-tech FDI are estimated for the leading OECD (Organisation of Economic Co-operation and Development) countries, namely Germany, Belgium, France, the Netherlands, Sweden, the United Kingdom and Japan. The findings of the first analysis indicate that while foreign-owned firms are generally more productive than German non-multinationals, there is no clear cut difference between foreign-owned firms and German multinationals. These differences would not have been uncovered, had the analysis compared foreign firms with all domestic firms. Equally, location within Germany is also important, as this productivity gap is more pronounced for firms which are located in the Eastern states. The findings of the second analysis suggest that engaging in outward FDI has an overall positive effect on the parent firm's productivity at home. Finally, results of the third analysis show that an expansion of high-tech offshoring activities by OECD multinationals (MNEs) is not associated with any reduction in employment at home.

Strategic positioning of manufacturing operations within global supply chains

In global environment, a company has to make many decisions that impact upon its position in global supply chain networks such as outsourcing, offshoring, joint venture, vertical/horizontal integration, etc. All these decisions impact on the company’s strategic position, and hence on competitive space and performance. Therefore, it is important for a company to carefully manage strategic positioning by making careful decisions about the adoption of alternative manufacturing and supply chain activities. Unfortunately, there is no complete process studied in strategic positioning of manufacturing operations within global supply chain. Therefore, the work presented in this paper has investigated leading research and industrial practices to create a formal and rational decision process. An analysis of previous literature, industrial practices, and the resulting decision process are all presented in this paper.

Strategic positioning of manufacturing operations within global supply chains

This paper describes research that has sought to create a structured and integrated methodology that guides manufacturers through the decision of strategic positioning within global supply chains. The position of a company is concerned with deciding a boundary and configuration of internal and external business activities to the company and is directly related to initiatives such as outsourcing, make or buy, and offshoring. This paper provides an in-depth description of this concept, describes work carried out to form a methodology for strategic positioning within the global supply chain, and presents the details of the methodology. This research has made a significant contribution to the knowledge on how manufacturing companies can form a strategic positioning within global supply chains.

Advances in global sourcing : models, governance and relationship:7th global sourcing workshop 2013, Val d’Isère, France, March 11-14, 2013, revised selected papers

This book contains 13 papers from the 7th Workshop on Global Sourcing, held in Val d'Isere, France, during March 11-14, 2013, which were carefully reviewed and selected from 40 submissions. They are based on a vast empirical base brought together by leading researchers in information systems, strategic management, and operations. This volume is intended for students, academics, and practitioners interested in research results and experiences on outsourcing and offshoring of information technology and business processes. The topics discussed represent both client and supplier perspectives on sourcing of global services, combine theoretical and practical insights regarding challenges that both clients and vendors face, and include case studies from client and vendor organizations.

The dynamics of global sourcing : perspectives and practices:6th global sourcing workshop 2012, Courchevel, France, March 12-15, 2012, revised selected papers

This edited book is intended for use by students, academics and practitioners who take interest in the outsourcing and offshoring of information technology and business services and processes. The book offers a review of the key topics in outsourcing and offshoring, populated with practical frameworks that serve as a tool kit for practitioners, academics and students. The range of topics covered in this book is wide and diverse, and represents both client and supplier perspectives on sourcing of global services. Various aspects related to the decision making process (e.g., asset transfer), learning mechanisms and organizational practices for managing outsourcing relationships are discussed in great depth. Contemporary sourcing models, including cloud services, are examined. Client dependency on the outsourcing provider, and social aspects, such as identity, are discussed in detail. Furthermore, resistance in outsourcing and failures are investigated to derive lessons as to how to avoid them and improve efficiency in outsourcing. Topics discussed in this book combine theoretical and practical insights regarding challenges that both clients and vendors face. Case studies from client and vendor organizations are used extensively throughout the book. Last but not least, the book examines current and future trends in outsourcing and offshoring, placing particular attention on the centrality of innovation in sourcing arrangements, and how innovation can be realized in outsourcing. The book is based on a vast empirical base brought together through years of extensive research by leading researchers in information systems, strategic management and operations.

New studies in global IT and business service outsourcing:5th global scourcing workshop 2011, Courchevel, France, March 14-17, 2011, revised selected papers

This book contains 11 carefully revised and selected papers from the 5th Workshop on Global Sourcing, held in Courchevel, France, March 14-17, 2011. They have been gleaned from a vast empirical base brought together by leading researchers in information systems, strategic management, and operations. This volume is intended for use by students, academics, and practitioners interested in the outsourcing and offshoring of information technology and business processes. It offers a review of the key topics in outsourcing and offshoring, populated with practical frameworks that serve as a tool kit for students and managers. The topics discussed combine theoretical and practical insights, and they are extensively illustrated by case studies from client and vendor organizations. Last but not least, the book examines current and future trends in outsourcing and offshoring, paying particular attention to how innovation can be realized in global or outsourced software development environments.

Preface

This edited book is intended for use by students, academics and practitioners who take interest in outsourcing and offshoring of information technology and business processes. The book offers a review of the key topics in outsourcing and offshoring, populated with practical frameworks that serve as a tool kit to students and managers. The range of topics covered in this book is wide and diverse. Various governance and coordination mechanisms for managing outsourcing relationships are discussed in great depth and the decision-making processes and considerations regarding sourcing arrangements, including multi-sourcing and cloud services, are examined. Vendors’ capabilities for managing global software development are studied in depth. Clients’ capabilities and issues related to compliance and culture are also discussed in association with various sourcing models. Topics discussed in this book combine theoretical and practical insights regarding challenges that both clients and vendors face. Case studies from client and vendor organizations are used extensively throughout the book. Last but not least, the book examines current and future trends in outsourcing and offshoring, placing particular attention on the centrality of innovation in sourcing arrangements, and how innovation can be realized in outsourcing. The book is based on a vast empirical base brought together through years of extensive research by leading researchers in information systems, strategic management and operations.

Preface

This edited book is intended for use by students, academics and practitioners who take interest in the outsourcing and offshoring of information technology and business services and processes. The book offers a review of the key topics in outsourcing and offshoring, populated with practical frameworks that serve as a tool kit for practitioners, academics and students. The range of topics covered in this book is wide and diverse, and represents both client and supplier perspectives on sourcing of global services. Various aspects related to the decision making process (e.g., asset transfer), learning mechanisms and organizational practices for managing outsourcing relationships are discussed in great depth. Contemporary sourcing models, including cloud services, are examined. Client dependency on the outsourcing provider, and social aspects, such as identity, are discussed in detail. Furthermore, resistance in outsourcing and failures are investigated to derive lessons as to how to avoid them and improve efficiency in outsourcing. Topics discussed in this book combine theoretical and practical insights regarding challenges that both clients and vendors face. Case studies from client and vendor organizations are used extensively throughout the book. Last but not least, the book examines current and future trends in outsourcing and offshoring, placing particular attention on the centrality of innovation in sourcing arrangements, and how innovation can be realized in outsourcing. The book is based on a vast empirical base brought together through years of extensive research by leading researchers in information systems, strategic management and operations.