Outsourcing and Financial Performance: A Negative Curvilinear Effect

Masaaki Kotabe, Michael J. Mol

Publikation: Bidrag til tidsskriftTidsskriftartikelpeer review

Abstrakt

This study asks how a firm's degree of outsourcing across all activities influences financial performance. We argue there is an optimal degree of outsourcing, where firms outsource some activities yet integrate others, and that deviations lower performance in a negatively curvilinear fashion. We find empirical support, using 1995 and 1998 data on a sample of manufacturing businesses in the Netherlands, and show that the steepness of the curve increases under conditions of high uncertainty. We show the magnitude of the uncertainty effect on performance outcomes through a post hoc scenario analysis. Thus we provide a specific, theoretically and empirically grounded prediction of how outsourcing affects performance with implications for theory and practice.
OriginalsprogEngelsk
TidsskriftJournal of Purchasing & Supply Management
Vol/bind15
Udgave nummer4
Sider (fra-til)205-213
ISSN1478-4092
DOI
StatusUdgivet - dec. 2009
Udgivet eksterntJa

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