© james kroes 2006 outsourcing of supply chain processes: evaluating the synergy between strategic...
TRANSCRIPT
© James Kroes 2006
Outsourcing of Supply Chain Processes: Evaluating the Synergy Between Strategic Outsourcing Drivers and Competitive Priorities
James Kroes
Georgia Institute of Technology
August 2006
© James Kroes 2006
Agenda
Goals Motivation Boundaries Theoretical Development Research Model and Hypotheses Research Design Summary
© James Kroes 2006
Goals
Competitive Priorities
Strategic Outsourcing
Drivers
Performance
Synergy
Assess strategic drivers of outsourcing Measure Outsourcing Synergy (Fit ) Impact of Outsourcing Synergy on performance
© James Kroes 2006
Motivation
Growth of outsourcing Shift from periphery to core
(Chamberland, 2003; Gottfredson, Puryear, and Phillips, 2005; Insinga and Werle, 2000; Kakabadse and Kakabadse, 2000b; Venkatraman, 2004)
Growth across the supply chain (Adler, 2003; Chamberland, 2003; Gottfredson et al., 2005; Heikkila and
Cordon, 2002; Kirk, 2001; Nohria, 2005; Orr, 2001; Palvia, 2003; Quinn, Doorley, and Paquette, 1990; Ramsay and Wilson, 1990; Ross, Dalsace, and Anderson, 2005; Willcocks, Hindle, Feeny, and Lacity, 2004)
Anecdotal evidence of strategic mismatches Cost is the dominant driver
(Casale, 2004)
© James Kroes 2006
Boundaries
Manufacturing business units operating in the United States Supply-Chain Council Operations Reference Model
Expanded view includes Product Development
Supply Chain Council. 2005. SCOR Overview, available at http://www.supply-chain.org.
© James Kroes 2006
Theoretical Development
Competitive Priorities and Corporate Strategy
Krajewski, L.J., Ritzman, L.P., 1999. Operations Management : Strategy and Analysis (6th Edition ed.). Prentice Hall: Upper Saddle River, NJ.
© James Kroes 2006
Theoretical Development
Corporate Strategy → Competitive Priorities
(Boyer and Lewis, 2002; Koufteros, Vonderembse, and Doll, 2002; Krajewski and Ritzman, 1999; Skinner, 1966, 1974; Ward, McCreery, Ritzman, and Sharma, 1998; Watts, Kim, and Hahn, 1992)
© James Kroes 2006
Theoretical Development
Strategic Outsourcing Drivers List determined from existing literature and feedback from supply
chain professionals Driver Mapping
We map the drivers to Competitive Priorities to measure which priorities are considered by a firm making an outsourcing decision (Non-Priority Drivers do not map to a Competitive Priority)
Three Options Develop Mapping from Theory Develop Mapping from Survey Responses Hybrid of the two approaches
© James Kroes 2006
Theoretical Development – Driver Mapping
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Theoretical Development - Role of Synergy
Two types of mismatches (Poor Synergy). Overemphasis of a Competitive Priority
Not considering the relevant drivers Under-emphasis of a Competitive Priority
Wasting resources by considering non-priority drivers
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High Level Research Model and Hypotheses
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Detailed Research Model and Hypotheses
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Evaluation of Outsourcing Synergy (Fit)
Evaluation of Fit (Measuring Outsourcing Synergy) Venkatraman (1989) – Profile Matching
Venkatraman, N., 1989. The Concept Of Fit In Strategy Research: Toward Verbal And Statistical Correspondence. Academy of Management. The Academy of Management Review 14(3), 423-444.
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Evaluation of Outsourcing Synergy Example
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Research Design
Methodology Empirically measure Competitive Priority and Strategic
Outsourcing Driver weightings in manufacturing business units Calculate the level of Outsourcing Synergy in four supply chain
areas Gather subjective and objective performance data
Scale Development Existing measures were adapted for Competitive Priority and
Performance Constructs Refined instrument through multiple Q-Sorts
© James Kroes 2006
Research Design
Survey Method Online survey website
Sample Population Request letters and follow up email message sent to 1,750
supply chain professionals working at domestic (U.S.) manufacturing firms
Instrument Validation CFA to examine the convergent and discriminant validity of the
measurement items Assess the Reliability of the multi-item constructs. CFA and Reliability results will be used to examine the scales of
the multi-item constructs
© James Kroes 2006
Research Design
Driver Mapping Determine Approach and develop Mapping
Hypothesis Evaluation Evaluation of Fit (Outsourcing Synergy)
Venkatraman (1989) – Profile Matching Evaluation of Hypotheses
H1 – Regression H2, H3, H4, H5, and H6 – Structural Equation Modeling
© James Kroes 2006
Research Design - Competitive Priorities
© James Kroes 2006
Research Design - Performance Measurement
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Goals
Competitive Priorities
Strategic Outsourcing
Drivers
Performance
Synergy
Assess strategic drivers of outsourcing Measure Outsourcing Synergy (Fit ) Impact of Outsourcing Synergy on performance
© James Kroes 2006
Current Status
Completed Activities Q-Sort completed Online survey instrument created Survey participation request letters and emails sent to 1,750
supply chain professionals Data collection in process
231 survey responses received Next Steps
Scale validation Determine Driver Mapping (Theoretical or Survey based?) Finalize Performance constructs Determine appropriate methodology to evaluate the model
© James Kroes 2006
Questions and Comments?