A Processual Analysis of the Purchasing and Supply Organization in Transition: The Impact of Offshoring

Godfrey Mugurusi, Lydia Bals

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    Resumé

    Many companies have resorted to offshoring in order to reduce costs and grow their global market presence. Yet it remains unclear what impact the offshoring strategy has on the purchasing and supply organization (PSO) of these companies. In this paper the nature and type of changes offshoring organizations make within the PSO are examined, i.e. how new purchasing and supply management (PSM) structures and practices emerge, are maintained or are discarded as production operations are relocated. The processual perspective is used to analyze empirical data from a rich, in-depth case study within a global engineering company. Results suggest that in line with the law of requisite variety the PSO changes thoroughly when the company relocates its production activities through the captive offshoring mode, but does so in a more disjointed and non-linear manner than the current stage models would suggest. The offshoring process provides momentum for PSO change and influences where and how the change happens. We present five propositions for further research and conclude that offshoring provides managers with opportunities to: (i) change and influence the strategic direction of PSM in their organizations, and (ii) build viable strategies of retaining and managing knowledge and PSM competencies in global operations. © 2016 Springer Science+Business Media New York
    OriginalsprogEngelsk
    TidsskriftOperations Management Research
    Vol/bind10
    Udgave nummer1-2
    Sider (fra-til)64–83
    Antal sider20
    ISSN1936-9735
    DOI
    StatusUdgivet - jun. 2017

    Emneord

    • Purchasing
    • Procurement
    • Sourcing
    • Supply management
    • Organization
    • Captive offshoring
    • Processual analysis
    • Case study research

    Citer dette

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    abstract = "Many companies have resorted to offshoring in order to reduce costs and grow their global market presence. Yet it remains unclear what impact the offshoring strategy has on the purchasing and supply organization (PSO) of these companies. In this paper the nature and type of changes offshoring organizations make within the PSO are examined, i.e. how new purchasing and supply management (PSM) structures and practices emerge, are maintained or are discarded as production operations are relocated. The processual perspective is used to analyze empirical data from a rich, in-depth case study within a global engineering company. Results suggest that in line with the law of requisite variety the PSO changes thoroughly when the company relocates its production activities through the captive offshoring mode, but does so in a more disjointed and non-linear manner than the current stage models would suggest. The offshoring process provides momentum for PSO change and influences where and how the change happens. We present five propositions for further research and conclude that offshoring provides managers with opportunities to: (i) change and influence the strategic direction of PSM in their organizations, and (ii) build viable strategies of retaining and managing knowledge and PSM competencies in global operations. {\circledC} 2016 Springer Science+Business Media New York",
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    A Processual Analysis of the Purchasing and Supply Organization in Transition : The Impact of Offshoring. / Mugurusi, Godfrey; Bals, Lydia.

    I: Operations Management Research, Bind 10, Nr. 1-2, 06.2017, s. 64–83.

    Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

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