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Understanding offshoring: A research framework based on disintegration, location and externalization advantages

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  • Kedia, Ben L.
  • Mukherjee, Debmalya

Abstract

We present an analytical framework explaining offshoring in this paper. We address the question: why do firms offshore their business functions? Given the growing prevalence of offshoring as a dominant business practice in the world of global business, this question merits further research attention. We propose that firms embark on offshoring when they perceive three sets of interrelated advantages: disintegration advantages (D), location-specific resourcing advantages (L) and externalization advantages (E). Theories from multiple disciplines form the foundation of Disintegration-Location-Externalization (DLE) framework. Implications for managers, government policy makers and recommendations for future research are explored.

Suggested Citation

  • Kedia, Ben L. & Mukherjee, Debmalya, 2009. "Understanding offshoring: A research framework based on disintegration, location and externalization advantages," Journal of World Business, Elsevier, vol. 44(3), pages 250-261, July.
    • Handle: RePEc:eee:worbus:v:44:y:2009:i:3:p:250-261
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