Revisiting the outsourcing debate: two sides of the same story

Abstract

Although outsourcing of organisational functions has become a popular practice amongst organisations, the literature provides a myopic and simplistic view of the phenomenon by focusing on either single functions or taking monadic views of a single party. The design of our study overcomes these weaknesses by including the following features: a range of organisational functions were included; the unit of analysis was the outsourcing contract; the level of analysis was at the dyadic level where both service providers and receivers presented their views and the approach was a qualitative one. In practice, this involved interviews with managers in service receiving and providing organisations that were in charge of 10 separate outsourcing arrangements. Using agency theory as a theoretical anchor, we contribute to the outsourcing debate by highlighting its complexity and areas of convergence and divergence between service receivers and providers, thereby suggesting a contingent approach towards implementation of outsourcing arrangements.

Keywords:

• outsourcing
• agency theory
• case studies
• dyadic