Abstract
Purpose - The vast majority of literature relating to operations management originates from studies in developed markets. Emerging markets are increasingly important in global business. With this in mind, this paper analyzes differences in outsourcing strategies between manufacturing firms from emerging markets and from developed markets.Design/methodology/approach - The paper is based on statistical analyses of a large data set of manufacturing firms obtained from the International Manufacturing Strategy Survey (IMSS).Findings - The findings suggest that companies that outsource internationally focus on achieving cost benefits, while companies that outsource domestically focus on achieving capacity flexibility. In addition, the reasons to outsource were found to be independent of the location of firms in both emerging and developed markets. However, within the group of firms from emerging markets, strategies seem to differ according to whether firms are domestically owned or are subsidiaries of companies from developed markets.Research limitations/implications - The implications for research comprise a more detailed understanding of the impacts on outsourcing decisions of the economic environment and of the ownership-location relationship. Future research opportunities include analyses of additional sets of country data, different classification criteria for emerging and developed countries, and consideration of contingencies beyond the variables in this paper. Limitations relate to the use of a multi-country database, due to which sampling procedures might be heterogeneous for different countries, and key-informant bias, both mitigated by research design decisions.Practical implications - The decisions of firms to outsource do not differ much whether the firms are located in developed- or in emerging-market economies. Firms outsource domestically when they want to increase their capacity flexibility; they outsource internationally when looking for cost advantages.Originality/value - The value of the paper is that it illuminates an important contemporary phenomenon based on analyses on data from a large-scale international survey encompassing firms both in developed and in emerging markets.
Purpose - The vast majority of literature relating to operations management originates from studies in developed markets. Emerging markets are increasingly important in global business. With this in mind, this paper analyzes differences in outsourcing strategies between manufacturing firms from emerging markets and from developed markets.Design/methodology/approach - The paper is based on statistical analyses of a large data set of manufacturing firms obtained from the International Manufacturing Strategy Survey (IMSS).Findings - The findings suggest that companies that outsource internationally focus on achieving cost benefits, while companies that outsource domestically focus on achieving capacity flexibility. In addition, the reasons to outsource were found to be independent of the location of firms in both emerging and developed markets. However, within the group of firms from emerging markets, strategies seem to differ according to whether firms are domestically owned or are subsidiaries of companies from developed markets.Research limitations/implications - The implications for research comprise a more detailed understanding of the impacts on outsourcing decisions of the economic environment and of the ownership-location relationship. Future research opportunities include analyses of additional sets of country data, different classification criteria for emerging and developed countries, and consideration of contingencies beyond the variables in this paper. Limitations relate to the use of a multi-country database, due to which sampling procedures might be heterogeneous for different countries, and key-informant bias, both mitigated by research design decisions.Practical implications - The decisions of firms to outsource do not differ much whether the firms are located in developed- or in emerging-market economies. Firms outsource domestically when they want to increase their capacity flexibility; they outsource internationally when looking for cost advantages.Originality/value - The value of the paper is that it illuminates an important contemporary phenomenon based on analyses on data from a large-scale international survey encompassing firms both in developed and in emerging markets.