The Application of an Outsourcing - Innovation Model

Jeff Readman

doi:doi:10.11648/j.ijber.20221106.11

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The Application of an Outsourcing - Innovation Model

Jeff Readman

Published in International Journal of Business and Economics Research (Volume 11, Issue 6)

Received: 1 August 2022 Accepted: 26 August 2022 Published: 4 November 2022

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Abstract

While the cost advantages associated with outsourcing are recognized, the impact that outsourcing may have on innovation performance depends on the strategic focus. One perspective suggests that firms outsourcing low value-adding activities will achieve higher innovation performance (that is, better designed or more technologically advanced products or more substantive process improvements) than firms that perform these activities in-house. Another view holds that firms that outsource high value-adding activities may have lower innovation performance than those firms that perform these activities in-house. Moreover, superior innovation performance can be achieved through the effective use of innovation, or dynamic, capabilities. This paper contributes to the outsourcing discourse by investigating the impact different outsourcing strategies can have on product innovation performance. An outsourcing- innovation (OI) model is proposed and applied to UK furniture manufacturing firms. The rational for selecting one industry is advantageous because the investigations allows for a comparison of organizations performing similar business functions. A survey of 78 firms was undertaken. Dichotomous, ordinal and multi measure variables were formulated and ordinal logistic regression was used to test the model. The study revealed that (i) innovation performance did not improve after non-essential functions were outsourced; (ii) performing specific core activities does have a positive influence on innovation performance and (iii) the findings support previous documented relationships that the use of innovation management capabilities has a positive impact on product innovation performance. The findings are relevant to other manufacturing industries, which demonstrate similar innovation performance and outsourcing patterns. The paper also suggests that the OI Model can be developed to include offsetting and interaction of different factors.

Published in	International Journal of Business and Economics Research (Volume 11, Issue 6)
DOI	10.11648/j.ijber.20221106.11
Page(s)	304-313
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Outsourcing, Innovation Performance, Operations Strategy

References

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Jeff Readman. (2022). The Application of an Outsourcing - Innovation Model. International Journal of Business and Economics Research, 11(6), 304-313. https://doi.org/10.11648/j.ijber.20221106.11

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Jeff Readman. The Application of an Outsourcing - Innovation Model. Int. J. Bus. Econ. Res. 2022, 11(6), 304-313. doi: 10.11648/j.ijber.20221106.11

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Jeff Readman. The Application of an Outsourcing - Innovation Model. Int J Bus Econ Res. 2022;11(6):304-313. doi: 10.11648/j.ijber.20221106.11

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@article{10.11648/j.ijber.20221106.11,
  author = {Jeff Readman},
  title = {The Application of an Outsourcing - Innovation Model},
  journal = {International Journal of Business and Economics Research},
  volume = {11},
  number = {6},
  pages = {304-313},
  doi = {10.11648/j.ijber.20221106.11},
  url = {https://doi.org/10.11648/j.ijber.20221106.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijber.20221106.11},
  abstract = {While the cost advantages associated with outsourcing are recognized, the impact that outsourcing may have on innovation performance depends on the strategic focus. One perspective suggests that firms outsourcing low value-adding activities will achieve higher innovation performance (that is, better designed or more technologically advanced products or more substantive process improvements) than firms that perform these activities in-house. Another view holds that firms that outsource high value-adding activities may have lower innovation performance than those firms that perform these activities in-house. Moreover, superior innovation performance can be achieved through the effective use of innovation, or dynamic, capabilities. This paper contributes to the outsourcing discourse by investigating the impact different outsourcing strategies can have on product innovation performance. An outsourcing- innovation (OI) model is proposed and applied to UK furniture manufacturing firms. The rational for selecting one industry is advantageous because the investigations allows for a comparison of organizations performing similar business functions. A survey of 78 firms was undertaken. Dichotomous, ordinal and multi measure variables were formulated and ordinal logistic regression was used to test the model. The study revealed that (i) innovation performance did not improve after non-essential functions were outsourced; (ii) performing specific core activities does have a positive influence on innovation performance and (iii) the findings support previous documented relationships that the use of innovation management capabilities has a positive impact on product innovation performance. The findings are relevant to other manufacturing industries, which demonstrate similar innovation performance and outsourcing patterns. The paper also suggests that the OI Model can be developed to include offsetting and interaction of different factors.},
 year = {2022}
}

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TY  - JOUR
T1  - The Application of an Outsourcing - Innovation Model
AU  - Jeff Readman
Y1  - 2022/11/04
PY  - 2022
N1  - https://doi.org/10.11648/j.ijber.20221106.11
DO  - 10.11648/j.ijber.20221106.11
T2  - International Journal of Business and Economics Research
JF  - International Journal of Business and Economics Research
JO  - International Journal of Business and Economics Research
SP  - 304
EP  - 313
PB  - Science Publishing Group
SN  - 2328-756X
UR  - https://doi.org/10.11648/j.ijber.20221106.11
AB  - While the cost advantages associated with outsourcing are recognized, the impact that outsourcing may have on innovation performance depends on the strategic focus. One perspective suggests that firms outsourcing low value-adding activities will achieve higher innovation performance (that is, better designed or more technologically advanced products or more substantive process improvements) than firms that perform these activities in-house. Another view holds that firms that outsource high value-adding activities may have lower innovation performance than those firms that perform these activities in-house. Moreover, superior innovation performance can be achieved through the effective use of innovation, or dynamic, capabilities. This paper contributes to the outsourcing discourse by investigating the impact different outsourcing strategies can have on product innovation performance. An outsourcing- innovation (OI) model is proposed and applied to UK furniture manufacturing firms. The rational for selecting one industry is advantageous because the investigations allows for a comparison of organizations performing similar business functions. A survey of 78 firms was undertaken. Dichotomous, ordinal and multi measure variables were formulated and ordinal logistic regression was used to test the model. The study revealed that (i) innovation performance did not improve after non-essential functions were outsourced; (ii) performing specific core activities does have a positive influence on innovation performance and (iii) the findings support previous documented relationships that the use of innovation management capabilities has a positive impact on product innovation performance. The findings are relevant to other manufacturing industries, which demonstrate similar innovation performance and outsourcing patterns. The paper also suggests that the OI Model can be developed to include offsetting and interaction of different factors.
VL  - 11
IS  - 6
ER  -

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Jeff Readman

Grenoble Ecole de Management, Grenoble, France

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Jeff Readman. (2022). The Application of an Outsourcing - Innovation Model. International Journal of Business and Economics Research, 11(6), 304-313. https://doi.org/10.11648/j.ijber.20221106.11

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Jeff Readman. The Application of an Outsourcing - Innovation Model. Int. J. Bus. Econ. Res. 2022, 11(6), 304-313. doi: 10.11648/j.ijber.20221106.11

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Jeff Readman. The Application of an Outsourcing - Innovation Model. Int J Bus Econ Res. 2022;11(6):304-313. doi: 10.11648/j.ijber.20221106.11

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@article{10.11648/j.ijber.20221106.11,
  author = {Jeff Readman},
  title = {The Application of an Outsourcing - Innovation Model},
  journal = {International Journal of Business and Economics Research},
  volume = {11},
  number = {6},
  pages = {304-313},
  doi = {10.11648/j.ijber.20221106.11},
  url = {https://doi.org/10.11648/j.ijber.20221106.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijber.20221106.11},
  abstract = {While the cost advantages associated with outsourcing are recognized, the impact that outsourcing may have on innovation performance depends on the strategic focus. One perspective suggests that firms outsourcing low value-adding activities will achieve higher innovation performance (that is, better designed or more technologically advanced products or more substantive process improvements) than firms that perform these activities in-house. Another view holds that firms that outsource high value-adding activities may have lower innovation performance than those firms that perform these activities in-house. Moreover, superior innovation performance can be achieved through the effective use of innovation, or dynamic, capabilities. This paper contributes to the outsourcing discourse by investigating the impact different outsourcing strategies can have on product innovation performance. An outsourcing- innovation (OI) model is proposed and applied to UK furniture manufacturing firms. The rational for selecting one industry is advantageous because the investigations allows for a comparison of organizations performing similar business functions. A survey of 78 firms was undertaken. Dichotomous, ordinal and multi measure variables were formulated and ordinal logistic regression was used to test the model. The study revealed that (i) innovation performance did not improve after non-essential functions were outsourced; (ii) performing specific core activities does have a positive influence on innovation performance and (iii) the findings support previous documented relationships that the use of innovation management capabilities has a positive impact on product innovation performance. The findings are relevant to other manufacturing industries, which demonstrate similar innovation performance and outsourcing patterns. The paper also suggests that the OI Model can be developed to include offsetting and interaction of different factors.},
 year = {2022}
}

Copy | Download

TY  - JOUR
T1  - The Application of an Outsourcing - Innovation Model
AU  - Jeff Readman
Y1  - 2022/11/04
PY  - 2022
N1  - https://doi.org/10.11648/j.ijber.20221106.11
DO  - 10.11648/j.ijber.20221106.11
T2  - International Journal of Business and Economics Research
JF  - International Journal of Business and Economics Research
JO  - International Journal of Business and Economics Research
SP  - 304
EP  - 313
PB  - Science Publishing Group
SN  - 2328-756X
UR  - https://doi.org/10.11648/j.ijber.20221106.11
AB  - While the cost advantages associated with outsourcing are recognized, the impact that outsourcing may have on innovation performance depends on the strategic focus. One perspective suggests that firms outsourcing low value-adding activities will achieve higher innovation performance (that is, better designed or more technologically advanced products or more substantive process improvements) than firms that perform these activities in-house. Another view holds that firms that outsource high value-adding activities may have lower innovation performance than those firms that perform these activities in-house. Moreover, superior innovation performance can be achieved through the effective use of innovation, or dynamic, capabilities. This paper contributes to the outsourcing discourse by investigating the impact different outsourcing strategies can have on product innovation performance. An outsourcing- innovation (OI) model is proposed and applied to UK furniture manufacturing firms. The rational for selecting one industry is advantageous because the investigations allows for a comparison of organizations performing similar business functions. A survey of 78 firms was undertaken. Dichotomous, ordinal and multi measure variables were formulated and ordinal logistic regression was used to test the model. The study revealed that (i) innovation performance did not improve after non-essential functions were outsourced; (ii) performing specific core activities does have a positive influence on innovation performance and (iii) the findings support previous documented relationships that the use of innovation management capabilities has a positive impact on product innovation performance. The findings are relevant to other manufacturing industries, which demonstrate similar innovation performance and outsourcing patterns. The paper also suggests that the OI Model can be developed to include offsetting and interaction of different factors.
VL  - 11
IS  - 6
ER  -

Copy | Download