Article
Exploring Political Risk in Offshoring Engagements
International Journal of Production Research
(2017)
Abstract
This research focuses on the analysis of political risk in the context of offshoring decisions. The study uses the Repertory Grid Technique, which entails a series of semi-structured interviews exploring key political risk experiences across offshoring engagements. The research extends the spectrum of political risk analysis in the context of offshoring engagements, and explores the varied impact of political risk across business activity types. The research identifies five key political risks affecting offshoring engagements and highlights the moderating effect of specific offshoring activity types Business Process Outsourcing, Information Technology Outsourcing or Knowledge Process Outsourcing on political risk implications. The research explores the conditioning effect of activity specific exposure to political risk and enhances the explanatory ability of the Transaction Cost Economics constructs, offering a novel operationalisation of the political risk component of external uncertainty. From a practical perspective, the research highlights the need for developing managerial tools to improve monitoring and identification of risks. The key practical contribution is the development of differentiated political risk typologies that can capture the nuances of external risks in offshoring, allowing for more accurate risk assessment of offshoring decisions.
Keywords
- Contracting out -- Political aspects,
- Risk assessment,
- Business logistics -- Management,
- Offshore outsourcing
Disciplines
Publication Date
2017
DOI
10.1080/00207543.2016.1268278
Publisher Statement
Copyright © Informa UK Limited. Published by Taylor & Francis.
Note: At the time of writing, Carlos Mena was affiliated with Michigan State University.
Citation Information
Hansen, C., Mena, C., & Skipworth, H. (2017). Exploring political risk in offshoring engagements. International Journal of Production Research, 55(7), 2051-2067.