Doing the right thing or doing things right: what is better for a successful manufacturing reshoring?

Albachiara Boffelli,Susana Cristina Lima Da Costa E Silva Silva,Luciano Fratocchi,Matteo Kalchschmidt

doi:10.1007/s12063-021-00183-2

Albachiara Boffelli, Susana Cristina Lima Da Costa E Silva Silva + Show 2 more

Open Access

https://doi.org/10.1007/s12063-021-00183-2

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Abstract

The article concerns the revision of earlier decisions to offshore production activities (so called “relocation of second degree”); more specifically it is focused on the “reshoring” (also referred as “relocation to the home country”, “back-reshoring” or “back-shoring”). The research aims are to investigate what types of mistakes occur along the decision-making and implementation process and how they affect the outcome, in terms of success or failure, of a relocation strategy. A multiple case study involving four companies in the fashion industry from Portugal and Italy was conducted. The cross-case analysis allowed to differentiate decision-making mistakes from implementation ones and to assess differences and similarities among the cases in terms of content of the relocation, drivers and outcomes. The research contributes to previous literature on reshoring by bringing evidence of different types of mistakes to be considered, thus requiring further conceptualization of the reshoring process. Managers and entrepreneurs should consider the importance of doing the things right also during the implementation, too often underestimated. The present article is the first one in the reshoring literature bringing evidence of cases of failure in the relocation decisions and discriminating among different kinds of mistakes.

Highlights

After decades of implementing manufacturing offshoring strategies, in the last few years, companies have been critically evaluating their earlier location decisions
Concerning the outcomes, we considered offshoring a failure if the company completely relocated to the home country, without leaving any activities or product lines in the host country, while reshoring was considered a failure if the production in the home country was later transferred back completely to the host country or if the whole company went bankrupt
This study aimed to understand what types of mistakes can occur along with the decision-making and implementation processes and whether how mistakes occurred in the company’s history of relocation decisions – i.e., both during offshoring and reshoring – affect the outcome, in terms of failure or success, of the relocation strategy

Summary

Introduction

After decades of implementing manufacturing offshoring strategies, in the last few years, companies have been critically evaluating their earlier location decisions. Reshoring (alternatively called in literature as “backreshoring” or “back-shoring”) has been defined as “a voluntary corporate strategy regarding the home-country partial or total relocation of (in-sourced or out-sourced) production to serve local, regional, or global demands” (Fratocchi et al 2014; Barbieri et al 2019). This recent phenomenon has been increasingly attracting scholars The analysis of the unsuccessful cases, as well as their comparison with successful ones, can be extremely helpful to shed new light on the reshoring phenomenon and to develop useful managerial implications (Silva and Silva 2012)

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