Dmitrij Slepniov

Offshore Outsourcing of Production: An Exploratory Study of Process and Effects in Danish Companies

Purpose – This paper is concerned with the realisation process of offshore outsourcing activities. The authors seek to understand the dynamic effects facing companies launching offshore outsourcing initiatives and to identify different types of mitigating efforts, which companies instigate to deal with these.Design/methodology/approach – Two exploratory case studies are developed based on interviews, documents, and site visits.Findings – The paper builds an understanding of patterns emerging from offshore outsourcing paths developments and discusses their organisational implications. It is proposed that the decision to dispatch standardised production tasks to parties overseas has implications over and beyond the initial intentions, which challenge the strategic scope and operationalisation of inter‐unit roles and responsibilities.Practical implications – The paper suggests that the process, and particularly the mitigation‐oriented agency that take place as the process unfolds throughout the company, dese...

Accessing offshoring advantages: what and how to offshore

Purpose – The purpose of this paper is to advance the understanding of factors that affect offshoring performance results. To do so, this paper focuses on the access to location-specific advantages, rather than solely on the properties of the offshoring company, its strategy or environment. Assuming that different levels of synergy may exist between particular offshoring strategic decisions (choosing offshore outsourcing or captive offshoring and the type of function) and different offshoring advantages, this work advocates that the actual fact of realization of certain offshoring advantages (getting or not getting access to them) is a more reliable predictor of offshoring success. Design/methodology/approach – A set of hypotheses derived from the extant literature is tested on the data from a quantitative survey of 1,143 Scandinavian firms. Findings – The paper demonstrates that different governance modes and types of offshored function indeed provide different levels of access to different types of loca...

Dynamic roles and locations of manufacturing

Purpose – The principal objective of this paper is to relate functional nodes of production and innovation in global operations networks. The authors aim to capture the implications of changing strategic roles and locations of manufacturing for innovation capabilities. Design/methodology/approach – The authors draw on the operations networks literature and use mixed methods of enquiry, including case studies, workshops and survey techniques. Part of the empirical base of the study is a series of workshops and an examination of 14 Danish companies that have experienced radical changes in their operations configurations. To provide a more complete view of these developments, the authors complement the qualitative methodology with a survey of an overall sample of 675 Danish and 410 Swedish companies. Findings – On the basis of the findings from the survey, the series of workshops and case studies of Danish companies presented in this paper, the authors find that although the potential benefits of global disp...

Offshoring practices of Danish and Swedish SMEs: effects on operations configuration

This paper examines how small and medium enterprises (SMEs) configure their operations on the global scale and how this affects their home bases in terms of operations requirements and priorities. In order to relate SMEs’ offshoring initiatives with their operations configuration attributes, we draw on the operations networks literature and survey responses from 675 Danish and 410 Swedish companies. On the basis of the survey results, we find that although the SMEs are less experienced and less advanced in their offshoring ventures than large companies, they are building dispersed operations networks. Although still in their infancy, these networks are, as expected, creating new demands for their home bases in terms of demands for formalisation of work processes, systems development and managerial capability related to orchestrating operations across national borders, but more fundamentally, it also challenges the strategic foundations of the home base. Based on these observations, we discuss future global operations management challenges, practices and priorities of SMEs.

Management of the learning curve: a case of overseas production capacity expansion

Purpose – This paper focuses on the management of the learning curve in overseas capacity expansions. The purpose of this paper is to unravel the direct as well as indirect influences on the learning curve and to advance the understanding of how these affect its management. Design/methodology/approach – The paper builds on the offshoring, capacity expansion and learning curve literature. The existing scholarship often lacks detailed insights into the factors surrounding the globalisation of production, and how constructing and operationalising new capacities overseas should be implemented. The paper employs qualitative methodology and draws on a longitudinal, factory-level analysis of an in-depth case study of a Danish wind turbine manufacturer. Findings – This study goes beyond a simplistic treatment of the lead time and learning required to establish a new capacity. The authors examined the dimensions of the learning process involved in a capacity expansion project and identified the direct and indirect...

Offshoring White-Collar Work: An Explorative Investigation of the Processes and Mechanisms in Two Danish Manufacturing Firms

The purpose of this chapter is twofold: to explain why white-collar service work in manufacturing firms is increasingly subject to offshoring and to understand the effects of this process on work integration mechanisms. The empirical part of the study is based on two case studies of Danish manufacturers. First, the chapter finds that drivers of white-collar work offshoring in many respects are parallel to those of the earlier wave of blue-collar work offshoring, that is, cost minimisation and resource seeking. Second, due to the interdependence of white-collar tasks with the rest of the organisation, our results suggest that white-collar offshoring in manufacturing firms poses higher requirements to the organisational configuration and capabilities compared with blue-collar work. We conceptualise the effects of white-collar work offshoring in a framework relating white-collar work to integration mechanisms companies instigate to manage it on a global scale.

The impact of distance on headquarters’ network management capabilities

Purpose The ability of an organisation’s headquarters (HQ) to bring value to and manage a globally dispersed multinational enterprise has been questioned in the existing literature. The purpose of this paper is to suggest that HQ-subsidiary distance is an important factor that affects such ability; this report also investigates the impact of distance on the HQ’s network management capabilities in the context of a global organisation’s evolution. Design/methodology/approach In this study, a single company was chosen to take part in a retrospective, longitudinal case study that highlighted two embedded product cases. The concept of distance was viewed as a variety of distance dimensions existing between the HQ and its subsidiaries. Findings The results indicated that distance impacted the effectiveness of the HQ’s network management capabilities by affecting HQ-subsidiary interaction and, consequently, shaping HQ’s knowledgeability about the subsidiaries’ operations. Moreover, the results suggested that the impact of such distance may shift from positive to negative over the course of a global organisation’s evolution. Research limitations/implications Although this study was explorative, some generalisability to industrial-goods companies of Scandinavian origin that have transferred activities to their owned subsidiaries may be expected. Further replication of the study using multiple case companies across various industries and countries is desirable. Originality/value This work extends the understanding of technological distance, sheds light on the conditions necessary for the HQ of a globally networked organisation to engage in value creation in the context of its evolution and contributes to the overall appreciation of distance as a factor that comprises multiple dimensions.

Understanding innovation spaces through emerging multinational enterprises in China: an explorative case study of a Chinese wind turbine manufacturer

This chapter firstly provides a theoretical framing to explicitly relate the entrepreneur (individual) with the venture (company) to the national innovation system in China. The proposed framework defines an innovation space as a multifaceted organism not restricted geographically; but rather seen as consisting of multiple levels, including institutional, organisational and geographical aspects. This chapter also provides empirical insights of this journey from entrepreneurial venture to multinational enterprise, by focusing upon the process of expansion and internationalization of research and development of the Chinese wind turbine manufacturer. In doing so, the chapter provides a thick case description, with many details about the development of this Chinese company in the renewable energy industry. Right from its establishment in 2006, the company has been emphasizing the importance of innovation for its activities.

Exploring Trajectories of Distributed Development: A Study of Two Danish Manufacturers

While some firms have successfully turned their global operations into a formidable source of competitive advantage, others have failed to do so. A lot depends on which activities are globally distributed and how they are configured and coordinated. Emerging body of literature and practice suggest that not only standardized manufacturing tasks, but also knowledge-intensive and proprietary activities, including research and development (R&D), are increasingly subject to global dispersion. The purpose of this chapter is to explore structural and infrastructural arrangements that take place in industrial firms as they globally disperse their development activities. The study employs qualitative methodology and on the basis of two case studies of Danish firms it highlights the challenges of distributed development as well as how these challenges can be dealt with. The chapter outlines a variety of practices used by the companies in order to achieve control and coordination of distributed development activities. Three propositions are developed to advance our understanding of the continual search for an optimal organizational form for managing distributed development.

Exploring the Changing Roles of Western Subsidiaries in China: Balancing Global Priorities with Local Demands

Over the past 30 years of economic development, the role of subsidiaries in China has changed. China has become an important host country for subsidiaries of western multinational companies seeking cost advantages and/or access to the emerging market potential. The objective of this paper is to explore the effects of the emerging strategic mandate of subsidiaries to serve local demands while meeting global corporate standards and operations priorities. We confirm well established dimensions such as strategic importance and operations capabilities while embeddedness into local business networks and level of process optimization are suggested as other dimensions determining the roles of subsidiaries and consequently their capabilities in an emerging market. These dimensions are established through literature review and validated by case studies of four Chinese subsidiaries of Danish industrial companies.