The term “strategic outsourcing” may sound like an oxymoron. Traditional dogma of outsourcing calls for companies to sequester strategic capabilities in-house and only source non-core or commoditized capabilities from 3rd parties. The situation becomes more complex in a dynamic market context since (i) what may be deemed a core competency today may become peripheral tomorrow and (ii) firms may increasingly find a deficit of in-house critical capabilities and know-how as they react to new markets and consumer changes. One key implication is that outsourcing must recognize and anticipate the underlying industry structural trends (consumer, technology, macro-economic) that can unexpectedly change a firm’s value chain capabilities landscape.
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