Global Sourcing Flexibility: Promoting Process Standardization, Location Capacity and Mobility of Resources

Recent studies show that flexibility is a key concern for firms that engage in the global sourcing of services. In this conceptual paper, we seek to explore two central aspects of global sourcing flexibility: In the first part of the paper, we provide a definition of the construct of global sourcing flexibility. Here we draw on prior research in the fields of organizational flexibility, international business and global sourcing as well as case examples and secondary studies. In the second part of the paper, we discuss the implications of global sourcing flexibility for firm strategy and operations against the backdrop of the theory-based definition of the construct. We discuss in particular the importance of global sourcing flexibility for operational performance stability, and the trade-off between specialization benefits, emerging from location and service provider specialization, versus the higher costs (but decreased risk for value chain disruption) embedded in a more flexible global sourcing model that allows the firm to replicate and/or relocate activities across multiple locations. We develop a model and propositions on facilitating and constraining conditions of global sourcing flexibility. We finally discuss implications for management and international business research, within and beyond the domain of global services sourcing.