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Outsourcing and Offshoring of Business Services: Challenges to Theory, Management and Geography of Innovation

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  • Silvia Massini
  • Marcela Miozzo

Abstract

Massini S. and Miozzo M. Outsourcing and offshoring of business services: challenges to theory, management and geography of innovation, Regional Studies . Drawing on an original survey, this paper discusses the trends and challenges posed by the outsourcing and offshoring of business services. It documents and analyses the increasing offshoring of business services (administrative services, call centres, information technology services, procurement, and product development) from the United States and Europe to less developed countries, the functions offshored, the size of offshorers, their destination, and the delivery models, and it explores the role of information and communication technologies and the development of both large global services suppliers and entrepreneurial ventures in developed and less developed countries. The paper derives implications regarding outsourcing decisions, the globalization of high value-adding activities, such as product development and innovation, raising issues of evolving market structure and the emergence of technical clusters where companies develop expertise to provide, and compete for, activities and skills across a range of sectors.

Suggested Citation

  • Silvia Massini & Marcela Miozzo, 2012. "Outsourcing and Offshoring of Business Services: Challenges to Theory, Management and Geography of Innovation," Regional Studies, Taylor & Francis Journals, vol. 46(9), pages 1219-1242, October.
    • Handle: RePEc:taf:regstd:v:46:y:2012:i:9:p:1219-1242
    DOI: 10.1080/00343404.2010.509128
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    References listed on IDEAS

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    1. Bardhan, Ashok Deo & Kroll, Cynthia, 2003. "The New Wave of Outsourcing," Fisher Center for Real Estate & Urban Economics, Research Reports qt02f8z392, Fisher Center for Real Estate & Urban Economics, UC Berkeley.
    2. Carliss Y. Baldwin & Kim B. Clark, 2000. "Design Rules, Volume 1: The Power of Modularity," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262024667, April.
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    Cited by:

    1. Ewa Cieślik, 2022. "A New Era Is Beginning in Central and Eastern Europe: Information and Communication Technology Services Exceed Manufacturing in the Global Production Chain," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(4), pages 2607-2639, December.
    2. Miozzo, Marcela & Desyllas, Panos & Lee, Hsing-fen & Miles, Ian, 2016. "Innovation collaboration and appropriability by knowledge-intensive business services firms," Research Policy, Elsevier, vol. 45(7), pages 1337-1351.
    3. Jana Kleibert, 2017. "On the global city map, but not in command? Probing Manila’s position in the world city network," Environment and Planning A, , vol. 49(12), pages 2897-2915, December.
    4. Charlotte Keijser & Michiko Iizuka, 2018. "Looking Beyond Global Value Chains in Capacity Development: The Case of the IT-Enabled Service (ITES) Sector in South Africa," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 30(3), pages 442-461, July.
    5. Keijzer, Charlotte & Iizuka, Michiko, 2017. "Pathways for capacity building in heterogeneous value chains: Evidence from the case of IT-enabled services in South Africa," MERIT Working Papers 2017-012, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    6. Baker, P. & Hawkes, C. & Wingrove, K. & Demaio, A. & Parkhurst, Justin & Thow, A.M. & Walls, H., 2018. "What drives political commitment for nutrition? A review and framework synthesis to inform the United Nations Decade of Action on Nutrition," LSE Research Online Documents on Economics 86630, London School of Economics and Political Science, LSE Library.
    7. Cristiano Codagnone & Fabienne Abadie & Federico Biagi, 2016. "The Future of Work in the ‘Sharing Economy’. Market Efficiency and Equitable Opportunities or Unfair Precarisation?," JRC Research Reports JRC101280, Joint Research Centre.
    8. Marfri Gambal & Aleksandre Asatiani & Julia Kotlarsky, 2022. "Strategic Innovation Through Outsourcing: A Theoretical Review," Papers 2206.00982, arXiv.org.
    9. Torben Schubert, 2024. "Captive Offshoring, Innovation and Market Diffusion: Evidence from the Swedish Community Innovation Survey," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(2), pages 5650-5678, June.
    10. Iammarino, Simona & McCann, Philip & Ortega-Argilés, Raquel, 2018. "International business, cities and competitiveness: recent trends and future challenges," LSE Research Online Documents on Economics 86626, London School of Economics and Political Science, LSE Library.
    11. Riccardo Crescenzi & Simona Iammarino & Carolin Ioramashvili & Andres Rodriguez-Pose & Michael Storper, 2019. "The Geography of Innovation: Local Hotspots and Global Innovation Networks," WIPO Economic Research Working Papers 57, World Intellectual Property Organization - Economics and Statistics Division.
    12. Crescenzi, Riccardo & Iammarino, Simona & Ioramashvili, Carolin & Rodríguez-Pose, Andrés & Storper, Michael, 2020. "The geography of innovation and development: global spread and local hotspots," LSE Research Online Documents on Economics 105116, London School of Economics and Political Science, LSE Library.
    13. Jeremiah, Rupin, 2017. "DECISION EVALUATION OF INNOVATION OFFSHORING: Swedish R&D in India," SSE Working Paper Series in Business Administration 2017:3, Stockholm School of Economics, revised 07 Dec 2017.
    14. Haibo Wang & Lutfu S. Sua & Jun Huang & Jaime Ortiz & Bahram Alidaee, 2024. "Will Southeast Asia be the next global manufacturing hub? A multiway cointegration, causality, and dynamic connectedness analyses on factors influencing offshore decisions," Papers 2406.07525, arXiv.org.
    15. Jeremiah, Rupin, 2017. "DO FIRMS INNOVATE ABROAD? - The Case of Swedish R&D in India," SSE Working Paper Series in Business Administration 2017:4, Stockholm School of Economics, revised 07 Dec 2017.
    16. Keijser, Charlotte & Belderbos, René & Goedhuys, Micheline, 2021. "Governance and learning in global, regional, and local value chains: The IT enabled services industry in South Africa," World Development, Elsevier, vol. 141(C).
    17. Mafini Dosso & Paulina Ramirez, 2020. "Organization and geography of global R&D and innovation activities: insights from qualitative research on leading corporate R&D investors," JRC Working Papers on Corporate R&D and Innovation 2020-03, Joint Research Centre.
    18. Daniel Schiller & Martijn J Burger & Bas Karreman, 2015. "The Functional and Sectoral Division of Labour between Hong Kong and the Pearl River Delta: From Complementarities in Production to Competition in Producer Services?," Environment and Planning A, , vol. 47(1), pages 188-208, January.
    19. Chacko G. Kannothra & Stephan Manning & Nardia Haigh, 2018. "How Hybrids Manage Growth and Social–Business Tensions in Global Supply Chains: The Case of Impact Sourcing," Journal of Business Ethics, Springer, vol. 148(2), pages 271-290, March.
    20. Mann, Laura & Graham, Mark, 2016. "The domestic turn: business processing outsourcing and the growing automation of Kenyan organisations," LSE Research Online Documents on Economics 85048, London School of Economics and Political Science, LSE Library.
    21. Meyer Susanne & Berger Martin, 2014. "Internationalisation of research and development activities of small and medium-sized enterprises in Austria: Strategic drivers for spatial organisation," ZFW – Advances in Economic Geography, De Gruyter, vol. 58(1), pages 1-17, October.

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