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The Role of Experience for Outsourcing Evaluation

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Abstract

The Role of Experience for Outsourcing Evaluation — Impact of Individual Outsourcing Experience on the Perception of Economies of Scale, Skill, and Scope

Despite a maturing IS literature mostly explaining outsourcing, many important phenomena challenging managers in charge of outsourcing decisions remain ambiguous.

In this paper, antecedents of the outsourcing decision are critically discussed focusing on the question: What is the impact of outsourcing experience on managers’ perception of economies of scale, scope, and skill? Based on an empirical survey with Germany’s Fortune 1,000 firms, it is shown that managers without prior outsourcing experience substantially overestimate the firm’s in-house competencies compared to external experts. The picture changes for managers with experience, establishing an important cultural barrier to outsourcing.

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Author information

Correspondence to Dipl.-Kfm. Daniel Beimborn.

Additional information

An earlier version of this article was winner of the best paper award / best outsourcing paper at the Tenth Americas’ Conference on Information Systems (AMCIS 2004), New York, USA [WeBF04]

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Beimborn, D., Franke, J. & Weitzel, T. The Role of Experience for Outsourcing Evaluation. Wirtschaftsinf 47, 431–440 (2005). https://doi.org/10.1007/BF03252656

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Keywords

  • Outsourcing
  • Experience
  • Financial Chain
  • Competence
  • E-Finance
  • Economies of Scale
  • Skill
  • Scope