Outsourcing-VINE.doc

Cataloguing might be deemed a core competence of

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conversion. Cataloguing might be deemed a ‘core competence’ of librarians, but whether that requires them to conduct it individually, site by site, is debatable. The perspective of core and non-core competencies starts to look less useful when the mission and main functions of the client organisation are changing, along with the skills required of its staff. The core competency perspective is useful in prompting serious consideration about the functions which are truly cost-effectively done in-house, and those which could be outsourced, without any loss to future requirements in expertise. The core competency perspective is less useful when some of the functions are core, but some, or most of the tasks involved could be outsourced as it would be cheaper to do that. For purchasing arrangements, libraries often need to consider the effects on staff functions, of sharing or delegating the work of previewing serials prior to purchase with other members of a purchasing consortium. Resource-based theory According to resource based theory, organisations wish to maintain a distinctive product (competitive advantage) and will plug gaps in resources and capabilities in the most cost- effective manner to do so. Outsourcing of cataloguing is easier to rationalise using resource-based theory as this emphasises that cost-effective solutions are required to some of the major activities, in order to fulfil the main aim of the organisation (provide organised access to resources). Resource-dependent theory With resource dependent theory, the environment of the organisation is almost as important as the organisation itself. The principle is that organisations adopt strategies to gain access to critical resources, to stabilise relationships with the external environment and to secure survival. With this theory, collaborative licensing deals are easy to rationalise. Collaboration allows access to resources (more effectively and more efficiently than without), deals lessen the problems of negotiations with many publishers on an individual basis, and survival (managing diminishing budgetary resources) is more assured. Some individual choice over selection has gone, but more is gained for apparently less effort in staff time.
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Transaction cost theory (TCT) With TCT, a more conventional economic approach is used. Organisations may buy from the market, or develop in-house, and decisions are based on the relative cost, composed of the costs of production, and costs of the transaction, of the exchange. TCT considers the asset specificity (to what extent can an asset, such as specialised software or product, be redeployed), uncertainty in the environment, as well as the frequency of the transaction. Taking a very simple example, is it better to use a breadmaker to make bread at home or buy bread in the supermarket? Having invested in the breadmaker, and gained some skills, can these skills (and the breadmaker) be used for other purposes (asset specificity)? How likely is that the supermarket where I would buy the bread would close, or alter its stocklines? And lastly, it would not be worth setting up special
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