Outsourcing Decisions in Global Supply Chains: An Exploratory Multi-Country Survey

Abstract

Outsourcing has become a necessity for most companies in today’s competitive environment, which is also evidenced by a growing interest by academics worldwide. However, to date very few multi-country studies exist that compare and contrast outsourcing decisions and practices by organizations in different countries. The present research aims to contribute to this area by reporting and analyzing results from a survey conducted in 15 countries. Using a total dataset of 806 responses, interesting empirical exploratory insights are reported on the evolving approaches and concepts of outsourcing decision-making in different countries. More specifically, this study provides characteristics of the most important suppliers to respondents across the 15 nations, and explores rationales for outsourcing, highlighting country-specific similarities and differences. In addition, four hypotheses are developed and tested, linking contract specificity, purchase risk, supplier responsiveness, and procedural rigor to purchase performance. Arguments are primarily based on transaction cost economics. And finally, differences on these main variables across the 15 countries are explored.

Keywords: outsourcing, global supply chain, purchase performance, supplier responsiveness, contract specificity, purchase risk, procedural rigor, survey research