Offshoring and the global distribution of work: Implications for task interdependence theory and practice

Received: 19 January 2007 Revised: 15 January 2008 Accepted: 28 January 2008 Online publication date: 30 October 2008 Abstract A recent Offshoring Research Network (ORN) global survey of offshoring shows that since 2004 management concerns about operational issues on achieving the benefits of offshoring have increased significantly. In this paper we examine inter-task interdependence, a key operational determinant of inter-site interaction and communications in offshoring. We analyze existing theories of interdependence to examine the extent to which they provide guidance for understanding the interaction and communication requirements between work segments that are offshored and distributed across the globe. Using a series of mini-cases on globally distributed work (GDW), we show how the traditional typology of interdependence developed in the 1960s and 1970s is no longer adequate for understanding and managing task interdependencies in GDW. We propose three concepts to address this problem: integration interdependence, ‘‘hand-offs’’, and information ‘‘stickiness’’. We then show how our revised typology of interdependence enables a better understanding of the interactions and communication requirements between sites. Using this revised theory we propose guidelines for work design, and examine their implications for practical offshoring and work-distribution decisions. Implications for theory and practice for MNEs engaged in offshore relationships are discussed. Journal of International Business Studies (2009) 40, 642–667. doi:10.1057/jibs.2008.77