Machiavelli, management and outsourcing: still on the learning curve

Abstract

PurposeThe purpose of this paper is to describe and assess the evolution of client and supplier approaches and capabilities from 1989 to 2010 in relation to outsourcing and delineate four phases which client learning can be observed to pass through over time. It assesses the lessons that outsourcing stakeholders can absorb from this short but rich history.Design/methodology/approachThe paper is based on a detailed review of 20 years of research into 1,600+outsourcing arrangements studied overtime, and carried out by the author with a range of colleagues, covering IT and business process outsourcing and offshoring practices.FindingsThe paper finds that learning has been slow and not passed well within organizations or across from the fields of ITO to BPO and offshore outsourcing. Retained capabilities emerge as a key lifebelt for survival. However, the more recent history has seen more moves towards greater collaboration, which make more objectives and innovation possible.Research limitations/implicationsThe paper provides a review of extant research, rather than providing new research.Practical implicationsThe outsourcing growth in prospect over the next few years depends for its management success on a shift from a power‐based orientation to governance structures and trust building and collaboration, given the otherwise high costs involved in monitoring and imposing sanctions, the negative orientations and behaviours adopted, and the limited goals that can be pursued by the parties.Originality/valueThe paper takes a historical perspective to outsourcing, and looks at evolution of the whole global market over 20 years.