Outsourcing-VINE.doc

Transaction cost theory emphasises that transaction

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Transaction cost theory emphasises that transaction costs should be minimised, to a boring level, possibly (Fritsch et al., 2002)otherwise there is the danger that it would as cheap, if not cheaper, to bring back the operation in-house. Transaction cost theory also indicates that the cost of setting up an outsourcing arrangement is unlikely to be beneficial if it is not going to be a frequent occurrence. A difficulty with some of the regional deal-making is that there may be much staff time expended in such arrangements, and little to show for it if there is some regional reorganisation of institutions. The health sector provides a good example of that. Regional consortia were established to buy databases, using the Regional Health Authority structures as a basis. When the Department of Health reorganised, new arrangements had to be made. Conclusions Outsourcing arrangements vary considerably and the complication for consideration of the effects on the relationship between the library and the publisher is that many of the deals are done through intermediary organisations or library consortia. That in itself means that libraries are dealing with other libraries as well as with publishers, and there may be levels of outsourcing to be considered. First, when dealing with the consortium arrangement, the library may need to consider the effects on core competencies in terms of staff skills, as well as the different perspectives on the ultimate goal for the institution of the consortium arrangement. Second, when considering the arrangements between the consortium and the publisher supplier, various theories such as transaction cost theory, and agency cost theory help to illustrate some of the attitudes towards risk of the partners involved and the way the costs of negotiation might be minimised. There seems little need for partnership theories at this stage, but perhaps some of the social exchange ideas need to be explored if the library-publisher relationship is to be productive for both parties. Within their own institutions libraries increasingly need to consider the publishers in their midst, the staff and researchers who are publishing on their own pages, and exploring open access models of publishing. Perhaps partnerships need to be explored between libraries and their in-house publishers? References Axelrod, R. (1997). The complexity of cooperation: agent-based models of competition and collaboration . Princeton, NJ: Princeton University Press.
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Ball, D. & Pye. (2000). Library purchasing consortia: the UK periodicals supply market. Learned Publishing 13 , (1), 25-35. Ball, D., Barton, D., Earl, C., & Dunk, L. (2002). A study of outsourcing and externalization by libraries with additional reference to the museums and archives domains . LIC report no. 132. London: Library and Information Commission.
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