Re-evaluating off-shoring - the role And influence of stakeholders

Abstract

The concept of outsourcing or 'off-shoring' has become a major topic of debate in countries including Australia, the UK and the USA, permeating political, economic and academic discussions. The focus has been on the export of skilled 'home country' jobs to more cost-effective regions on the one hand, versus the acceptance of a global market and an increase in skill and knowledge levels in developing markets on the other. This debate has been particularly evident in relation to the export of information technology and call centre operations to countries such as India, Mexico and China. Many commentators view such moves as representing a fait accompli, due to significant labour cost advantages and access to skilled labour and infrastructure in the global economy. However, there are a variety of issues associated with the process of outsourcing, including the more obvious issue of the loss of employment and the management (control) of the work, that permeate both the economic, social and moral decision making of management. In addition, organisational stakeholders can play an influential role in off-shoring decisions and their success or failure. Recent high profile cases in Australia and the US, illustrate not only the importance of involving stakeholders in decisions to outsource, but also their ability to reverse or reject the off-shoring route. This paper utilises stakeholder theory to explore the role and influence of stakeholders in organisational decisions to outsource.