How the Transaction Cost and Resource-based Theories of the Firm inform Outsourcing Evaluation

Research output: Contribution to journalArticle

266 Citations (Scopus)

Abstract

Transaction cost economics (TCE) and the resource-based view (RBV) of the firm have been extremely influential in the study of outsourcing both in theory and practice. This paper argues that neither transaction cost economics nor the resource-based view alone can fully explain the complexities of outsourcing. A review and critique of these theories as a means of understanding the complexities of outsourcing is presented. A prescriptive framework for outsourcing evaluation is presented, which was developed from integrating TCE and the RBV, and carrying out in-depth case study research in a number of organizations. The research findings emphasize the utility of integrating TCE and the RBV, and highlight the importance of operations management concepts such as performance management, operations strategy, business improvement, and process re-design to the study of outsourcing. However, the findings have shown that these theories should be applied with caution due to contradictory prescriptions in some instances.
LanguageEnglish
Pages45-63
JournalJournal of Operations Management
Volume27
Issue number1
DOIs
Publication statusPublished - 2009

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Outsourcing
Economics
Costs
Transaction costs
Resource-based theory
Transaction cost economics
Theory of the firm
Evaluation
Resource-based view
Industry

Keywords

  • outsourcing
  • operations strategy
  • transaction cost economics
  • resource-based view
  • and inter-organizational collaboration

Cite this

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How the Transaction Cost and Resource-based Theories of the Firm inform Outsourcing Evaluation. / McIvor, R.

In: Journal of Operations Management, Vol. 27, No. 1, 2009, p. 45-63.

Research output: Contribution to journalArticle

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