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Unformatted text preview: Offshore Outsourcing: Implications for International Business and Strategic Management Theory and Practice Jonathan P. Doh Villanova University In this essay, I discuss the implications of the debate over offshoring for our collective understanding of international business and management theories. I review several core theories in international business expansion and management strategy to assess which elements of these theories may need to be re-specified in light of the offshoring phenomenon and which aspects remain relevant. I then present normative implications and recommendations for public policy and corporate strategy, drawing from emerging insights regarding the global responsibilities of corporations. I suggest that international labour and environmental standards and corporate codes of conduct could mitigate some of the most intense concerns raised about offshoring but conclude that offshoring is likely to present challenges to societies, corporations, and stakeholders for many decades. INTRODUCTION As the previous two essays illustrate, there is considerable divergence over the causes and consequences of offshoring (Farrell, 2005; Levy, 2005). Inherent in this debate are disagreements over basic assumptions in economic theory and man- agement decision-making. Indeed, although offshoring is not new, its acceleration real or perceived may challenge established theoretical orthodoxy regarding the operation of the global economy generally, and management practice, in par- ticular. In this essay, I explore the implications of the debate over offshoring for our collective understanding of some leading international business and strategic management theories. Recent efforts to reconceptualize the IB field, especially as it relates to global strategic management, have stressed globalization, the changing strategy of MNEs Journal of Management Studies 42:3 May 2005 0022-2380 Blackwell Publishing Ltd 2005. Published by Blackwell Publishing, 9600 Garsington Road, Oxford, OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA. Address for reprints : Jonathan P. Doh, Villanova University 800 Lancaster Avenue, Villanova, PA 19085, USA (firstname.lastname@example.org). and their impact on the world economy (Buckley and Ghauri, 2004), the factors that determine the success or failure of firms within this competitive environment (Peng, 2004), and the growing importance of Civil Society and NGOs to the theory and practice of IB (Teegen et al., 2004). These research directions capture the context (culture, geography, institutions), firm-level goals (performance), and societal impact (globalization and its challenges) that are critical to analysis of offshoring and its impacts. Ramamurti (2004) recently identified offshore out- sourcing of services as an emerging research theme in IB, however he notes that to date, the IB research community has paid limited attention to this important phenomenon....
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