Outsourcing has become a commonly accepted alternative of strategic management. But how do stockholders rate the corporate decision to divest parts of the former business? We study the stock market reaction of outsourcing announcements of the global financial services industry, using event study methodology and multivariate cross-sectional regression analysis. We analyze a sample of 162 outsour...

While expensive cryptographically verifiable computation aims at defeating malicious agents, many civil purposes of outsourced computation tolerate a weaker notion of security, i.e., “lazy-but-honest” contractors. Targeting this type of agents, we develop optimal contracts for outsourcing of computational tasks via appropriate use of rewards, punishments, auditing rate, and “redundancy”. Our co...

This paper considers four schemes for routing low-value calls between the client company and the outsourcer. These schemes vary in the complexity of their routing algorithms, as well as the sophistication of the telephone and information technology infrastructure they require of the two operations. For three of these schemes, we provide a direct characterization of system performance. For the f...

In the idea of the “death of distance,” globalization discourse presents a picture of a world of global social and economic integration, declining cultural differentiation, spatial and temporal disembedding of social practices, and the economic primacy of dematerialized knowledge work. Nearshore software outsourcing, a subcategory of offshore software outsourcing in which the development center...

This paper analyses how international outsourcing affects plant total factor productivity (TFP) using a census of Irish manufacturing firms. The results point to a striking pattern: the status of being or becoming an outsourcer matters strongly for firms that are indigenous and not exporting, while for exporters and foreign affiliates, TFP increases are lower, insignificant and sometimes negati...

Previous studies indicate that prior experience of the outsourcer has an impact on the actual outsourcing evaluation. However, the question where this experience derives from remains unanswered. In an empirical analysis with Germany's 200 largest banks it is empirically shown that the level of experience indeed has a significant impact on senior management's attitude towards outsourcing. Furthe...

What is the importance of specific control and contractual mechanisms for IT outsourcing relationship quality and outsourcing success? Employing a survey among financial institutions and applying Importance-Performance Analysis (IPA) known from marketing research, we analyse the relative importance of Service Level Agreements, control and contractual mechanisms for relationship quality and outs...

Companies may choose to outsource parts, but not all, of their call-center operations. In some cases, they classify customers as high or low-value, serving the former with their " in house " operations and routing the latter to an outsourcer. Typically, they impose service-level constraints on the time each type of customer waits on hold. This paper considers four schemes for routing low-value ...

Companies may choose to outsource parts, but not all, of their call-center operations. In the course of studying contact centers in the telecommunications and financial services industries, we have observed the following (apparently) common scheme. A company classifies its customers as high or low-value, serving the former with their " in house " operations and routing the latter to an outsourc...