Further offshoring: Contingencies for new offshoring generation

This paper aims at exploring and identifying the contingencies that influence the occurrence of repeated offshoring opportunities. We address the following research questions regarding new initiatives within current services offshoring frameworks: Under which conditions offshoring investments generate further offshoring opportunities? Which party is more likely to give rise to such offshoring opportunities? With these questions in mind, we conducted two case studies on two Italian medium-sized software companies both doing offshoring since 2000, respectively in Tunisia and in India. We collected data through open interviews with the CEOs, Human Resources manager, IS manager, the Offshore manager, two project managers, and 20 operators in each company. Each interview lasted two hours on average. We examined numerous documents, like balance sheets, quality manuals, meeting excerpts, internal memos, consultants’ reports, too. The case study firms resort to the same coordination modes – i.e. captive centers. In both cases, the offshorees have developed technical architectural knowledge (through formal training, continuity of collaboration over time, staff exchange, ICT-mediated interactions etc.), underpinning the software products. The empirical evidence illustrates that both context and product characteristics influence the generation of repeated offshoring opportunities,. More generally we underline how it is only through a thorough comprehension of all the factors at play, and of their complex intertwining, that the precious aptitude of offshoring to generate new offshoring can be grasped and successfully exploited.