A dynamic model of strategic outsourcing with emphasis on human resources and work experience in power industry of Iran

Abstract

Purpose The production of a good or service requires that the supplier performs a wide range of activities. Many companies are trying to fit outsourcing with the dimensions of their organization. Outsourcing is increasingly being used among Iranian companies in the field of the electric power industry. Human resources are among the factors that consider outsourcing as an obstacle for their growth because staffs declare that the development of outsourcing is a serious threat for unemployment of them and ultimately expulsion from work. Thus, this study surveys the dynamic effects of human resources and work experience on outsourcing decisions. This paper aims to propose a model for dynamic strategic outsourcing focusing on human resource and work experience. Design/methodology/approach Presenting a model for strategic outsourcing can help organizations to resolve their outsourcing problems. The data needed for examining the dynamic impact of human resources and work experience on outsourcing have been compiled using library and field studies. The method used in this study is an integrated approach, so the model could consider the general effects of manpower and present a systematic view. After interviewing with experts in power industry, the causal relationships of the variables were determined, and a dynamic model based on the applications of the dynamic system was developed in VENSIM software. The research model will be completed in a three-year period (2016-2019) in the power industry of Iran. Findings For completing projects in an organization, cooperation between internal employees and external contractors is needed; thus, results based on both external contractors and internal staff have shown that outsourcing through working of a number of contractors will be more effective than frequent use of one contractor. On the other hand, improving the quality of projects could be done by training new employees using skilled and expert employees. Originality/value Existence of one-dimensional models (only with qualitative factors or only with quantitative factors) in the context of outsourcing in the past studies has prompted to study different types of factors together as a dynamic model. This paper presents a quantitative and qualitative model in the field of strategic outsourcing with emphasis on human resources and work experience. In the past studies, there was no way to formulate the qualitative factors, and they simply used the data from the organization, and the only formulation in their works was based on quantitative factors. But in this study, both factors with dynamic modeling have been formulated.