Bringing Together Strategic Outsourcing and Corporate Strategy: Outsourcing Morives and Risks

B. QUÉLIN, F. Duhamel

European Management Journal

October 2003, vol. 21, n°5, pp.467-661

Departments: Strategy & Business Policy, GREGHEC (CNRS)

Keywords: Corporate strategy, Strategic outsourcing, Core business, Risk

The authors report the results of a study on the motives of corporate headquarters in large European manufacturing firms for engaging in outsourcing and the risks they perceive to be associated with strategic outsourcing operations. Four main issues can be highlighted: preoccupations about core businesses and reduction of cost of capital are linked; access to external expertise and quality improvements are specific expectations for outsourcing firms; operational cost savings, still a predominant concern, must be balanced with the cost of monitoring suppliers; the ‘increased flexibility’ objective emerges as a distinct issue