The relentless forces of competition and globalization compel firms to disaggregate their value chain and reach for foreign inputs, markets and partners. By “slicing” the chain into discrete value activities--some to be performed in-house, others to be outsourced--firms expect to reduce overall costs and risks, while possibly also share the benefits of innovations of their allies worldwide. Firm boundaries shrink organizationally but expand geographically, while also becoming more permeable. This SMG research stream is organized in the following projects:

1. Dynamics of globalization: The location factor has long been neglected in International Management studies, traditionally relegated to an exogenous role and ascribed a somewhat trivial impact. One major source of this neglect is our conceptualization of firms’ location-specific advantages as completely distinct from firm-specific advantages—i.e., a factor that only explains the choice of location for different activities but not the variation in firm-specific advantages. Hence, the purpose of this project is to make location-specific factors more endogenous to firm competitiveness.

2. Hidden costs of offshoring: The “fine-slicing” and geographical dispersion of value-chain activities that are infusing more complexity in the organization are often ignored in offshoring decisions. The complexity will typically manifest itself in hidden costs that materialize when implementing the decision. The project aims at identifying organizational mechanism to mitigate the hidden costs of offshoring like standardization, modularization, etc.

 

SMG Participants in research stream

Professor Torben Pedersen
Professor Bent Petersen
Associate Professor Christian Geisler Asmussen
Assistant Professor Peter Ørberg Jensen
PhD Student Marcus Møller Larsen
PhD Student Tamara Stucchi

 

 

Recent Results/Representative Publications

Jensen P. Ø. and T. Pedersen. 2012.  Offshoring and International Competitiveness: Antecedents of Offshoring Advanced Tasks . Journal of the Academy of Marketing Science.

Asmussen, C. G., T. Pedersen, T. Devinney and L. Tihanyi. 2011.  Advances in International Management, 24: Dynamics of Globalization: Location-Specific Advantages or Liabilities of Foreignness?  Emerald.

Jensen, P.Ø. and B. Petersen. 2011. Global Sourcing of Advanced Services - A Strategic Management Analysis. Strategic Management Society Conference Paper.

Larsen, M. M., S. Manning and T. Pedersen. 2011.  Uncovering the Hidden Costs of Offshoring: The Interplay of Complexity, Organizational Design and Experience . Conference Paper (finalist for Best Paper Award at the Academy of Management Annual Meeting, San Antonio, Texas, 12-16 August, 2011).

Jensen P. Ø. and T. Pedersen. T. 2011.  The Globalization of High-Value Activities: Why do Firms Offshore Advanced Tasks?  Journal of Management Studies, 48: 352-372.

Contractor F., V. Kumar, S. Kundu and T. Pedersen. 2010.  Reconceptualizing the Firm in a World of Outsourcing and Offshoring: The Organizational and Geographical Relocation of High-Value Company Functions (with) . Journal of Management Studies, 47: 1417-1433.