Offshore outsourcing: Operating in emerging market economies

Abstract

Given a progressively more competitive global environment, it is increasingly being contended that the central factor in the success and survival of organizations is the effective management of buyer—supplier networks (Gummesson, 2002; Thorelli, 1986). We define a “buyer—supplier network” as a web of interdependent firms working together to supply services and products to one focal buyer (Moller et al., 2005; Moller and Torronen, 2003). One example of a buyer — supplier network is an outsourcing relationship in which the buyer is based in a developed market and the supplier is located in an emerging market. In this regard, such firms are increasingly less likely to behave in isolation when developing customer and competitor oriented strategies. In doing so, these firms are required to develop unique learning capabilities in order to improve their responsiveness to customers (Day, 2002; Schultze and Boland, 1997; Slater and Narver, 1995). Such issues have been explored within the marketing literature (Baker and Sinkula, 2002; Schultze and Boland, 1997; Slater and Narver, 1995), management learning literature (Loasby, 1999; Senge, 1990) and international business literature (Zander, 2003; Minbaeva et al., 2003). For example, Nobeoka et al. (2002) found that suppliers were able to lever their organizational learning through the development of strong interfirm relationships with multiple customers.