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Trade-offs in make-buy decisions
KTH, School of Industrial Engineering and Management (ITM), Industrial Economics and Management (Dept.).
2011 (English)In: Journal of Purchasing and Supply Management, ISSN 1478-4092, E-ISSN 1873-6505, Vol. 17, no 3, 158-166 p.Article in journal (Refereed) Published
Abstract [en]

While the previous literature uses transaction cost economics and the resource-based view to theoretically derive the benefits of outsourcing, it has so far overlooked how these theoretical underpinnings must be used to assess trade-offs involved in make-buy decisions as well. This study investigates trade-offs in make-buy decisions for the buying firm. It takes an operations strategy perspective and links manufacturing firms' competitive priorities to outsourcing motives and resulting capabilities. Survey data from a representative sample of 136 manufacturing plants in Sweden is subjected to regressions analysis. In contrast to earlier empirical research, this study shows that resulting capabilities of strategic outsourcing initiatives are distinct, and, furthermore, do not emerge cumulatively. This has important implications for the ongoing debate over trade-offs in the operations strategy literature. Findings are clearly in support of the trade-off model and extend current research into the theoretical domain of make-buy decisions.

Place, publisher, year, edition, pages
2011. Vol. 17, no 3, 158-166 p.
Keyword [en]
Operations strategy, Make-buy decision, Trade-offs
National Category
Economics and Business
URN: urn:nbn:se:kth:diva-46199DOI: 10.1016/j.pursup.2011.04.002ISI: 000295241800003ScopusID: 2-s2.0-79961004272OAI: diva2:453501
QC 20111102Available from: 2011-11-02 Created: 2011-11-02 Last updated: 2011-11-02Bibliographically approved

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Dabhilkar, Mandar
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