Global Sourcing of Business Processes: History, Effects, and Future Trends

Manning, S., Larsen, M.M., Kannothra, C.G. 2017. “Global Sourcing of Business Processes: History, Effects, and Future Trends”. In: Clark, G.L., Feldman, M.P., Gertler, M.S., Wojcik, D. (Eds.): The New Oxford Handbook of Economic Geography. Oxford, UK: Oxford University Press, Forthcoming

28 Pages Posted: 30 Aug 2016 Last revised: 25 Oct 2016

Stephan Manning

University of Massachusetts at Boston - College of Management

Marcus M. Larsen

Copenhagen Business School - Department of Strategic Management and Globalization

Chacko G Kannothra

University of Massachusetts Boston - College of Management

Date Written: August 26, 2016

Abstract

We review key drivers, trends and consequences of global sourcing of business processes – the sourcing of administrative and more knowledge-intensive processes from globally dispersed locations. We argue that global sourcing, which is also associated with ‘offshoring’ and ‘offshore outsourcing’, has co-evolved over the past three decades with the advancement of information and communication technology (ICT), a growing pool of low-cost, yet often qualified labor and expertise in developing countries, and increasing client-side global sourcing experience. We show how this dynamic has led firms to develop new global capabilities, governance and business models, changed the geographic distribution of work and expertise, and promoted the emergence of new geographic knowledge services clusters. We further introduce three new trends – the emergence of global delivery models, ICT-enabled service automation, and impact sourcing – and discuss future directions for research.

Keywords: Outsourcing, offshoring, business processes, geographic clusters, new business models, information and communication technology

JEL Classification: J23, J24, J44, J31, M51, M53, M54, L14, L21, L22, L24, L84, O14, R11, P45, P48, F59, F21, F22, F23

Suggested Citation

Manning, Stephan and Larsen, Marcus M. and Kannothra, Chacko G, Global Sourcing of Business Processes: History, Effects, and Future Trends (August 26, 2016). Manning, S., Larsen, M.M., Kannothra, C.G. 2017. “Global Sourcing of Business Processes: History, Effects, and Future Trends”. In: Clark, G.L., Feldman, M.P., Gertler, M.S., Wojcik, D. (Eds.): The New Oxford Handbook of Economic Geography. Oxford, UK: Oxford University Press, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2830650

Stephan Manning (Contact Author)

University of Massachusetts at Boston - College of Management ( email )

100 Morrissey Blvd
Boston, MA 02125
United States

Marcus M. Larsen

Copenhagen Business School - Department of Strategic Management and Globalization ( email )

Porcelænshaven 24
Frederiksberg, 2000
Denmark

Chacko George Kannothra

University of Massachusetts Boston - College of Management ( email )

Boston, MA
United States

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