What is so special with outsourcing in the public sector?

Abstract

Purpose This paper centers round outsourcing. The purpose of this paper is to direct attention to outsourcing in the public sector and focus on what could be special when considering outsourcing in such contexts. The authors try to portray the business activities in private and in public sector settings and identify some similarities and – more importantly – some significant differences. Design/methodology/approach The authors use two analytical tools, a classification system of various interfaces between a selling and buying firm and a two-fold scheme for strategic analyses of outsourcing or not as well as in what ways to outsource. These tools have been developed in studies of private sector outsourcing but are applicable, as tools, also in public sector contexts. Two empirical cases from public sector outsourcing are used to illustrate options and obstacles for outsourcing ventures in the public sector. Findings The analytical discussion aims at pointing out when and how outsourcing should be a straightforward choice in the public sector. The authors also point at situations when it is a much more complicated process and thus restricted. Originality/value This study gives strong support for the need to identify which theoretical model has been used by the involved organizations in their evaluation of the situation.