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A conceptual framework for understanding the outsourcing decision


  • Vining, Aidan
  • Globerman, steven


Outsourcing is an increasingly important initiative being pursued by corporations in North America and Europe in pursuit of improved efficiency. This paper provides a conceptual framework to assist managers in identifying and implementing outsourcing decisions. In particular, the framework suggests a way for managers to identify the pre- and post-contractual risks associated with outsourcing decisions along with strategies that can be implemented in the pre-contractual stage in order to mitigate those risks. Empirical findings from the 'transactions cost' literature are referenced to illustrate elements of our conceptual framework.

Suggested Citation

  • Vining, Aidan & Globerman, steven, 1999. "A conceptual framework for understanding the outsourcing decision," European Management Journal, Elsevier, vol. 17(6), pages 645-654, December.
  • Handle: RePEc:eee:eurman:v:17:y:1999:i:6:p:645-654

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    References listed on IDEAS

    1. Eric von Hippel, 1994. ""Sticky Information" and the Locus of Problem Solving: Implications for Innovation," Management Science, INFORMS, vol. 40(4), pages 429-439, April.
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    Cited by:

    1. Rosa Forte & António Brandão, 2008. "Effects of Adverse Selection on a Multinational Firm’s Decision on where to Subcontract," Journal of Industry, Competition and Trade, Springer, vol. 8(2), pages 133-146, June.
    2. Gunasekaran, Angappa & Irani, Zahir & Choy, King-Lun & Filippi, Lionel & Papadopoulos, Thanos, 2015. "Performance measures and metrics in outsourcing decisions: A review for research and applications," International Journal of Production Economics, Elsevier, vol. 161(C), pages 153-166.
    3. Federica VIGANO & Andrea SALUSTRI, 2015. "Matching profit and Non-profit Needs: How NPOs and Cooperative Contribute to Growth in Time of Crisis. A Quantitative Approach," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 86(1), pages 157-178, March.
    4. Freytag, Per V. & Clarke, Ann H. & Evald, Majbritt R., 2012. "Reconsidering outsourcing solutions," European Management Journal, Elsevier, vol. 30(2), pages 99-110.
    5. P. Everaert & G. Sarens & J. Rommel, 2006. "Sourcing of Accounting: Evidence from Belgian SMEs," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 06/403, Ghent University, Faculty of Economics and Business Administration.
    6. Tattara, Giuseppe, 2010. "Choosing between foreign investment and subcontracting: Strategies of Italian firms in Romania," MPRA Paper 23787, University Library of Munich, Germany.
    7. Aidan R. Vining, 2003. "Internal Market Failure: A Framework for Diagnosing Firm Inefficiency," Journal of Management Studies, Wiley Blackwell, vol. 40(2), pages 431-457, March.
    8. Cecilia NAVARRA & Elena VALLINO, 2015. "Who Had the Idea to Build Up a Village Organization? Some Evidence from Senegal and Burkina Faso," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 86(1), pages 33-72, March.
    9. Steven Globerman & Aidan Vining, 2004. "The Outsourcing Decision: A Strategic Framework," International Trade 0404007, EconWPA.
    10. Wang, Li Ming & Liu, Li Wen & Wang, Yong Jie, 2007. "Capacity decisions and supply price games under flexibility of backward integration," International Journal of Production Economics, Elsevier, vol. 110(1-2), pages 85-96, October.
    11. Barbara Bradaè Hojnik, 2010. "Correlation Between Reasons And Effects Of Outsourcing: Evidence From Slovenian Sme’S," Analele Stiintifice ale Universitatii "Alexandru Ioan Cuza" din Iasi - Stiinte Economice, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, vol. 57, pages 313-324, november.
    12. Maike Scherrer-Rathje & Patricia Deflorin & Gopesh Anand, 2010. "Outsourcing and its Impact on Manufacturing Flexibility: Contingencies Matter," Working Papers 0125, University of Zurich, Institute for Strategy and Business Economics (ISU).
    13. Torabi, S.A. & Baghersad, M. & Mansouri, S.A., 2015. "Resilient supplier selection and order allocation under operational and disruption risks," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 79(C), pages 22-48.
    14. Chia-Chi Lee & Tyrone Lin & Pei-Chu Cheng, 2013. "The determinants of the transportation outsourcing strategy for the express delivery company," Service Business, Springer;Pan-Pacific Business Association, vol. 7(2), pages 207-225, June.
    15. Cooper, Robin & Slagmulder, Regine, 2004. "Interorganizational cost management and relational context," Accounting, Organizations and Society, Elsevier, vol. 29(1), pages 1-26, January.
    16. Michael Siegenthaler & Tobias Stucki, 2014. "Dividing the Pie: The Determinants of Labor's Share of Income on the Firm Level," KOF Working papers 14-352, KOF Swiss Economic Institute, ETH Zurich.
    17. Andrea Salustri & Federica Viganò, 2015. "Human development and well-being during the great recession. The non-profit sector as a capability enhancing workplace," BEMPS - Bozen Economics & Management Paper Series BEMPS27, Faculty of Economics and Management at the Free University of Bozen.

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