Purchasing and Supply Organisation in Transition: An Exploratory Case of Offshoring Within a Global Engineering Company

Godfrey Mugurusi, Lydia Bals

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    The increasing global competition, declining product life cycles and high market uncertainties are making organizations rethink their operations. Offshoring is among the many strategies organizations are using to redefine their operations and grow market presence. However, it is still not clear which impact offshoring has on the organization’s purchasing and supply operations. This paper is about the changes in the purchasing and supply organization (PSO) as the process of offshoring production occurs. How new purchasing structures and practices emerge and (how) the old purchasing structures and practices are discarded. The paper draws from an empirical in-depth case study of a global robots manufacturer. The company’s offshoring process is longitudinally reconstructed using both historical and current data, and then changes within its PSO are mapped from series of semi–structured interviews, observations and archival analysis. The preliminary findings suggest that the PSO changes dramatically when the company relocates production activities through the captive offshoring mode. However, these structural changes are somewhat intermittent but deterministically influenced partly by the offshoring process (e.g. product complexity, change of supply base, competence availability, etc.) and partly the environmental factors (e.g. host country legislation, market uncertainty, etc.).
    Original languageEnglish
    Title of host publicationProceedings of the 56th Annual Meeting of the Academy of International Business : Local Contexts in Global Business
    EditorsKlaus Meyer, Tunga Kiyak
    Place of PublicationEast Lansing, MI
    PublisherAcademy of International Business
    Publication date2014
    Publication statusPublished - 2014
    EventAIB 2014 Annual Meeting : Local Context in Global Business - Westin Bayshore, Vancouver, Canada
    Duration: 23 Jun 201426 Jun 2014
    Conference number: 56


    ConferenceAIB 2014 Annual Meeting
    LocationWestin Bayshore
    Internet address
    SeriesAcademy of International Business. Annual Meeting. Proceedings

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