Outsourcing in Supply Chain Management

With growing global business competition and complexity in supply chains, firms have recognized that it is not possible to maintain competitiveness in a global market on their own. Therefore, involvement of third-party providers is an important strategic tool to allow companies to focus on their core competencies and access global resources. Outsourcing, therefore, plays an important role in global supply chains. Outsourcing is sure to grow. Today, supply chain firms are facing a wide variety of alternatives, needing to consider several important considerations before making the right decision. It has therefore become important to understand the phenomenon of outsourcing to better facilitate effective and successful decision-making. These points are relevant, as recent evidence hints at an increasing number of failures in cost management and issues arising out of related partner engagements. This chapter focuses on outsourcing in the global supply chain, examining its different classifications and characteristics and providing insights into past, current, and emerging concerns in the management of outsourcing processes. Furthermore, this chapter combines theoretical and practical insights, focusing on the main challenges of implementing outsourcing in the supply chain discipline that practitioners and professionals are confronting. With continued globalization and unpredictable situations like pandemics, outsourcing is forecasted for continued growth. As such, it is not only timely to explore new sourcing dimensions, such as outsourcing 2.0, crowdsourcing, and Industry 4.0 technologies but also to examine sustainable practices for the future of logistics in supply chains.