Outsourcing and industrial decline
Abstract
Executive Overview The improper use of outsourcing is playing an important role in the continuing competitive decline of many Western firms. Western managers often view outsourcing as a defensive operational measure. The approach tends to be incremental. A whole series of incremental outsourcing decisions, taken individually, may make economic sense, but collectively they may also represent the surrender of the business's capability to compete. However, properly understood and managed as an overall part of strategy, outsourcing can aid competitiveness. This article, based on the authors' research with firms in North America. Europe, and Asia, discusses the manner in which the improper use of outsourcing can destroy the future of a business, and how the proper use of outsourcing can help build competitive advantage.
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The classic warning about hollowing out concerns activities a firm once performed and could perform again.
“The classic warning about hollowing out concerns activities a firm once performed and could perform again [15].”
From Borrowed Competence: When AI-Driven HR Builds Startups’ People Capability and When It Hollows It Out (2026) · cites this paper as [15]
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Fowler, S. W., King, A. W., Marsh, S. J., & Victor, B. (2000) · Journal of Engineering and Technology Management · doi:10.1016/s0923-4748(00)00029-1 · Cited by 127 · see citing works
Outsourcer-supplier coordination for parts machining outsourcing under social manufacturing
Leng, J., Jiang, P., & Zheng, M. (2017) · Proceedings of the Institution of Mechanical Engineers, Part B: Journal of Engineering Manufacture · doi:10.1177/0954405415583883 · Cited by 38 · see citing works
Borrowed Competence: When AI-Driven HR Builds Startups’ People Capability and When It Hollows It Out
Ben Oz, R., Granot, N., Tzabbar, D., & Tzafrir, S. (2026) · doi:10.2139/ssrn.7489654
- Authors
- Bettis, R. A., Bradley, S. P., & Hamel, G.
- Affiliations
- Southern Methodist University
- Harvard Business School
- London Business School
- Venue
- Academy of Management Perspectives
- Publisher
- Academy of Management
- Published
- 1992-02
- Volume
- 6
- Issue
- 1
- Pages
- 7-22
- ISSN
- 1558-9080
- 1943-4529
- Cited by
- 232
- References
- 0
- Language
- en
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