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  • 1.
    Edoff, Petra
    Mälardalen University, School of Innovation, Design and Engineering.
    Bad Smells in Offshoring: Six Pitfalls Leaders Should AvoidManuscript (preprint) (Other academic)
  • 2.
    Edoff, Petra
    Mälardalen University, School of Innovation, Design and Engineering. Mälardalen University, School of Innovation, Design and Engineering, Innovation and Product Realisation.
    Managing offshoring of complex products: Strategy and capabilities2014Doctoral thesis, comprehensive summary (Other academic)
    Abstract [en]

    Offshoring is a hot topic in the industrial and academic community over the last few years, evolving from a focus on manufacturing to product development and R&D. Offshoring refers to the process of sourcing and coordinating tasks across national borders and can include both in-house and outsourced activities performed by a supplier. There is a lot of research guiding the decision of what, where and how to offshore, but research on how to implement offshoring strategies is rare. The purpose of this dissertation is to contribute to the knowledge on how companies deal with offshoring in practice, relating to strategy, planning and routines. It discusses what type of capabilities that is needed to gain the benefits of offshoring implementations.

    The research builds on case studies from two multinational companies offshoring product development from Sweden to captive and offshore development centres in India and China through a series of interviews, review of business documentation and other types of active engagements over time.

    This research highlights how the development and implementation of offshoring can be better understood by focusing on the middle management in the organization and how they relate to the top management directives when implementing an offshoring strategy.  The thesis contributes to existing theory by explaining offshoring as a process, situated in a certain context and time. It defines key routines and capabilities needed to facilitate offshoring of complex product systems. Including context, timing and sequence when analysing offshoring help explain why some organizations fail to implement offshoring initiatives.

    The companies had an iterative learning process to deal with offshoring, and inclusion of all levels in an organization was highlighted as a key success factor for the implementation of offshoring. The results extend current understanding of offshoring of complex products to Asia and provide useful guidelines for managers on the key issues they need to consider. 

  • 3.
    Edoff, Petra
    Mälardalen University, School of Innovation, Design and Engineering.
    Organizational capabilities for managing the offshoring of product development2011Licentiate thesis, comprehensive summary (Other academic)
    Abstract [en]

    Large multinationals must continually innovate to produce products and services that meet the needs of a global market. In order to distribute work across multiple sites, they use techniques such as offshoring and outsourcing. This requires them to address organizational and cultural aspects to coordinate distributed product development activities.  While these techniques have received great interest in business as well as research in recent years, as the latest trend is to send increasingly complex functions such as research, development and engineering (RD&E) overseas. When offshoring involves high value functions, the transitions occur rapidly, and the associated risks and costs of failing increase. In addition to the hidden costs of offshoring and outsourcing, there is a risk of losing core competences over time or spillovers of critical knowledge to competitors in the new market. Despite the criticality of succeeding with their offshoring efforts, little is known considering of how companies handle the process of distributing work globally, and the capabilities they develop to manage offshoring efficiently. The objective of this thesis is to explore the routines and capabilities that organizations´ need to develop to make offshoring an integral part of the management global RD&E.

     Two in-depth case studies are used to develop firm specific theories which can inform both the theory and practice of managing offshoring. Case A provides insight into a client-supplier relationship between the Swedish site of a multinational and its Indian service provider. The current challenges identified through the case study are paired with a retrospective analysis of the evolution of the decade-long relationship, to show how the cross-cultural interface has influenced the evolution of the relationship. With the assistance of a literature review, the findings are explained through the theoretical lenses of national culture, organizational culture and contextual factors. Case B provides insight into offshoring management in terms of a product management transfer from a Swedish site to a research center in China of the same multinational. Besides the insights into the transfer of responsibility for a complex product overseas, the case provides the base of an organizational capabilities framework for managing all stages in the offshoring process (decision, transfer, operations and governance stage). Four key capabilities were found to support the management of offshoring, namely; technological skills, process & tools, relationship management and knowledge management.

  • 4.
    Edoff, Petra
    Mälardalen University, School of Innovation, Design and Engineering, Innovation and Product Realisation.
    The middle management of offshoring: Understanding offshoring strategy implementation at a meso level2013In: Lecture Notes in Business Information Processing, 2013, p. 71-92Conference paper (Refereed)
    Abstract [en]

    A majority of the research on offshoring is positioned on a macro level, explaining firm level strategies for offshoring and the antecedents of offshoring decisions, but research on implementation of offshoring strategies is rare. The author suggest that the actual development and implementation of offshoring can be better understood by applying a meso level approach; the middle management in the organization and its relation to top management directives, when implementing an offshoring strategy. A multiple case study of two multinational company's offshoring product development to captive centers in India and China show how middle management facilitates the transfer process. By placing the study at a meso level and taking a strategy-as-practice perspective, the findings included: a) the iterative nature of the offshoring process, b) the lack of (communicated) strategies for offshoring and its consequences, and c) a set of routines connected to offshoring emerging at different levels in the company. © Springer-Verlag Berlin Heidelberg 2013.

  • 5.
    Edoff, Petra
    Mälardalen University, School of Innovation, Design and Engineering.
    The Middle Management of Offshoring: Understanding Offshoring Strategy Implementation at a Meso Level2013In: Lecture notes in Business Information Processing: Advances in global sourcing: Models, Governance, and Relationships / [ed] Ilan Oshri, Julia Kotlarsky and Leslie Willcocks, Springer , 2013, p. 71-92Chapter in book (Other academic)
    Abstract [en]

    A majority of the research on offshoring is positioned on a macro level, explaining firm level strategies for offshoring and the antecedents of offshoring decisions, but research on implementation of offshoring strategies is rare. The author suggest that the actual development and implementation of offshoring can be better understood by applying a meso level approach; the middle management in the organization and its relation to top management directives, when implementing an offshoring strategy. A multiple case study of two multinational company’s offshoring product development to captive centers in India and China show how middle management facilitates the transfer process. By placing the study at a meso level and taking a strategy-as-practice perspective, the findings included: a) the iterative nature of the offshoring process, b) the lack of (communicated) strategies for offshoring and its consequences, and c) a set of routines connected to offshoring emerging at different levels in the company.

  • 6.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering. Mälardalen University, School of Innovation, Design and Engineering, Innovation and Product Realisation.
    Manning, Stephan
    University of Massachusetts Boston.
    Strategy implementation as a contingent process: The interplay of Managerial Interpretation, Task organization, and Implementation experience2013Conference paper (Refereed)
  • 7.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Norström, Christer
    Mälardalen University, School of Innovation, Design and Engineering.
    Implementing Open Innovation - In Collaborative Flexible Team Formations2010In: 17th International product Development Management Conference, Murcia, 2010Conference paper (Refereed)
  • 8.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Norström, Christer
    The evolution of an collaboration-between an European high tech company and its Indian service provider2009Conference paper (Refereed)
    Abstract [en]

    Companies are looking for new ways of decreasing costs and gaining innovation, as the competition is escalating. Striving to shorten product lifecycles and time to market, the product development has become increasingly important for companies on the global market (Van Echtelt et al, 2008; Primo, 2002), with respect to speed (Clark, 1989) performance and cost (Van Echtelt et al 2008). In addition to this, there is a need to manage geographically and functionally dispersed units, as well as suppliers all over the world, to remain competitive. A recent trend show that the capabilities and resources for managing product development increasingly reside outside company´s boundaries, e.g. relying on suppliers. The offshore outsourcing contracts have mainly been awarded to developing countries, to benefit from labour arbitrage. While the clients of outsourcing are concentrated in North America, Western Europe and Japan, India has been the leading destination (Mao et al. 2008).

    Current research has identified several factors for successful outsourcing, including; Supplier competence in technology and quality control (Boutellier et al, 2008; Primo & Amundson, 2002), Interface management and communication (Boutellier et al, 2008; Primo & Amundson, 2002; Van Looy et al, 2005 ), Amount of direct interaction with supplier (Primo & Amundson, 2002), Legislation and contracts (Mao et al, 2008), Nature of supplier involvement (Primo & Amundson, 2002; Clark, 1989), Trust (Van Echtelt et al, 2008; Sherwood & Covin, 2008 ; Mao et al, 2008), Intercultural Understanding (Edoff et al, 2009) and the maturity of collaboration (Sherwood and Covin, 2008). While there is a buzz concerning strategies for outsourcing as well as incorporating Open Innovation (Chesbrough, 2003), there is a lack of understanding of the evolution and transformation of such collaborations. We will describe the complexity of governing outsourcing relationships, the actions and understanding needed to increase learning and innovation capabilities in a supplier-client relation.

    In this paper we use an in depth case study to describe the relation between a high tech European company and an Indian consultancy firm, which started 2000. The companies were studied over a period of six months, in Sweden and at the Offshore Development Center in India, to provide a bilateral perspective on managing customer-supplier relationships. In total 40 respondents were interviewed, and the results were triangulated by observation (including participation in management day) as well as analyzing business review documentation. The collaboration has evolved from outsourcing maintenance, to product development of partial as well as whole products. But what does the shift from outsourcing in regard of cost, flexibility and value mean for outsourcing relation? The companies have performed a wide range of activities to strengthen the relation internally (common goal, intercultural understanding, order competence), within the relation (courses, workshops and exchanging employees) as well as external relations (university collaboration and Top talent program). The results of the case study show that the evolution of outsourcing relation is due to many different factors as stated in the literature, but also greatly affected by the intercultural differences. The intercultural factors influence not only communication, but the organizational culture and structure, motivation and the innovative capability of the companies. While the Indian service provider can take advantage of their collective culture to be efficient with processes and knowledge transfer, the Swedes can benefit from the low power distance to make quick decisions and try out radical ideas. If companies learn about the differences they can organize and adjust processes in a way that the relation gives them the best of both worlds.

  • 9.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Norström, Christer
    Boivie, Ylva
    Managing Offshore Development- an Intercultural Perspective2009Conference paper (Refereed)
    Abstract [en]

    Offshore Outsourcing, by utilizing the suppliers´ economy of scale and lower wages, is one of the solutions that companies use to reduce costs. However, as the outsourced tasks are getting more complex and require innovative practices, cultural differences get exposed. Cultural aspects are important to consider in securing efficiency and innovation in offshore outsourcing. Nevertheless, the cultural influence has only been studied to a limited extent in literature. With this in mind, we have performed a case study exploring the cultural differences between a Swedish high tech company and its Indian service provider. The study is based on 40 in-depth interviews, observations and business review documentation. The phenomenon of culture is framed by a literature review on organizational culture, national culture and contextual factors. Our results show that by understanding, relating to and managing cultural differences in a systematic manner, companies can gain competitive advantages.

  • 10.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Norström, Christer
    Mälardalen University, School of Innovation, Design and Engineering.
    Boivie, Ylva
    Mälardalen University, School of Innovation, Design and Engineering.
    Managing offshore development- an intercultural perspective2009Conference paper (Refereed)
  • 11.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Norström, Christer
    Mälardalen University, School of Innovation, Design and Engineering.
    Wretås, Ylva
    Mälardalen University, School of Innovation, Design and Engineering.
    Managing offshore development: a cultural perspective2012In: Series on technology management - Vol. 18: Perspectives on supplier innovation: theories, concepts and empirical insights on open innovation and the integration of suppliers / [ed] Alexander Brem & Joe Tidd, United States: Imperial College Press , 2012, p. 549-580Chapter in book (Other academic)
  • 12.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Srinivasan, Jayakanth
    Mälardalen University, School of Innovation, Design and Engineering.
    Offshoring of complex products – a process approach2012In: Offshoring Research Network International Conference 2012, 2012Conference paper (Refereed)
    Abstract [en]

    Offshoring as a theoretical concept clearly relates to the process of sending work overseas, however the majority of the research on offshoring has focused the decision stage rather than the complete lifecycle. This paper is based on longitudinal case studies of two Global Fortune 500 companies which are sending work from several of their globally dispersed business units to their R&D centers in China & India. A generic process of distributing work globally; from decision to transfer and operational governance is described. Studying the decisions translated into practice, aspects such as managerial intentionality, path dependence, and the need for strategic alignment are highlighted. Our results show that these companies consider offshoring as an ongoing iterative process of managing complex work in a global organization, where one transfer project may result in more functions being transferred. This paper develops the foundations of a process framework to support sustainable offshoring practice.

  • 13.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Srinivasan, Jayakanth
    Mälardalen University, School of Innovation, Design and Engineering.
    Transfer Management for Global Product Development Organization2011Conference paper (Refereed)
    Abstract [en]

    Global product development has become integral to the way enterprises work today. The drivers for distribution work to global locations such India and China began with a focus on the significant cost differentials when compared to executing the work in western countries (Mao et al. 2008). Since then, the availability of talent (Lewin et al, 2009; Quelin & Duhamel, 2003) and accessibility of markets (Goldbrunner et al, 2006; Mao et al. 2008) have become equally important motivators.

     

    The use of offshoring adds an additional layer of complexity to the already complex product development governance processes that companies use. Current literature discuss the offshoring or outsourcing decision (Levina & Su, 2008), describing organizational objectives for offshoring (Quelin & Duhamel, 2003; Lewin et al, 2009), guidelines for location choices (Cohen et al, 2009), deciding what functions to send offshore (Contractor et al, 2010) coupled with core competencies, as well as risks associated with offshoring (Lewin and Peeters, 2006; Aron & Singh, 2005). The offshoring process itself can be framed in terms of the decision to send functions (components, products, or services) overseas, progressing to planning and executing a transfer and iterating through the governance associated with operations. Since the vast majority of the literature focus on the decision stage of the offshoring process, or the governance perspective on existing globally distributed teams, there is still a need for understanding the process of transferring components and whole products. This papers aims to shed further light on that gap by describing the actual process of executing a successful transfer.

     The empirical foundation of this paper is a single in-depth case study of a new product development organization being established in China. We used an inductive approach that relied on qualitative and archival data to truly understand the dynamics of managing the offshoring of complex products and uncover the underlying mechanisms and structures. Given the paucity of literature and experience reports on transfers, an exploratory approach for collecting qualitative data was used. The primary source of data collection in this paper was interviews with key stakeholders within the projects at the general management and project management levels. We interviewed 15 managers from the Swedish and Chinese centres, and analysed archival data to gain a deeper understanding into both the sending and receiving side.

     The case enterprise, called Eurosoft, has a rich history of outsourcing to other suppliers, and was beginning to establish its presence in China. A strategic decision was taken by senior leadership to create an offshore organization in China that would assume complete ownership of one of their flagship products. Contrary to the conventional wisdom of having the same organizational structure replicated on the European and Chinese sites, Eurosoft chose to establish a product-centred organization on the China side. This paper will give insight to the context of transferring entire product responsibility for a mature product. While the strategies and motivations of distributing work across the product development life cycle have been debated in the literature, the question remains – how do you implement it?

     The case highlighted the key challenges that organizations face when handing an offshoring scenario. Even though Eurosoft Swedish centre was transitioning work to a sister organization within the larger Eurosoft enterprise, they faced hurdles with respect to establishing a common framework for carrying out the product transfer; communicating across cultural and national boundaries; having the receiving team demonstrate and feel comfortable with their competence; and dealing with the mismatch of organizational priorities in the two organizations. Eurosoft found that it was challenging to adhere to the transfer model when key resources from the sending side were often also focused on development projects unrelated to the transfer. When those projects ran into problems, the mentors from the sending side were unavailable to the receiving side. This introduces variability in the transfer process. While everyone recognized the importance of defining and locking the scope of the transfer, they found that scope creep occurred because a strategic roadmap was not articulated to the whole team. Furthermore, the number of interdependencies within a given product and between the products in the portfolio made it difficult to get consensus on the scope. The challenges that emerged in the case are consistent with that faced by project managers studied by Lacity and Rottman (2008). While none of these challenges in and of themselves are unique, the combination of the challenges in the context of a transfer project provides useful insights to both theory and practice.

     Based on the study, our recommendations to the practicing manager are to:

    -          Establish a standard transfer model that clarifies transfer scope up front, and develop a governance mechanism to assess progress.

    -          Ensure communication modes and interface mechanisms are articulated and agreed upon, and that training has been provided to address soft issues such as culture.

    -          Provide dedicated resources to ensure effective knowledge transfer to the receiving team

    -          Develop competencies in the receiving team across the four areas of technical, product governance, ways of working, and cultural commonality.

  • 14.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Srinivasan, Jayakanth
    Mälardalen University, School of Innovation, Design and Engineering.
    Uncovering paradoxes in managing globally distributed product development: A multiple case study2013In: International Journal of Case study method, Research and Application, ISSN 1554-7752, Vol. XXV, no 3, p. 195-206Article in journal (Refereed)
    Abstract [en]

    Offshoring of knowledge-intensive work is a relatively new phenomenon wherein organizations choose to distribute segments of their value chain ranging from testing, to product development and innovation across geographical and organizational boundaries. Moving work from one location to another creates new challenges for the organization as the complexity of the processes and number of organizational interfaces increases. This paper uses three case studies to explore the paradoxes and underlying tensions found in the practice of globally distributed development. The study demonstrates how multiple levels of analysis can be applied to resolve the tensions and trade-offs in globally distributed work.

  • 15.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Srinivasan, Jayakanth
    Mälardalen University, School of Innovation, Design and Engineering.
    UNCOVERING THE PARADOXES OF MANAGING GLOBALLY DISTRIBUTED DEVELOPMENT – A CASE STUDY APPROACH2012Conference paper (Refereed)
    Abstract [en]

    Offshoring is an emerging trend where companies choose to globally distribute segments of the value chain ranging from production and testing, to product development and innovation. Offshoring of activities that were previously performed at home base create new challenges for the industry, as the complexity of both the process as well as the organizational interfaces increase. Three case studies are used to explore the paradoxes found in the practice of globally distributed development. We discuss the need for opposition, spatial and temporal separation, and synthesis to explain and resolve the tensions and trade-offs in globally distributed development that is visible in these case studies.

  • 16.
    Edoff, Petra
    et al.
    Mälardalen University, School of Innovation, Design and Engineering.
    Srinivasan, Jayakanth
    Mälardalen University, School of Innovation, Design and Engineering.
    Understanding Organizational Capabilities for Effective Offshoring2011In: Proceedings of the 1st International Technology Management Conference, ITMC 2011, 2011Conference paper (Refereed)
    Abstract [en]

    In the current competitive environment, the question is no longer whether or not to go offshore, but in determining what should be offshored and how it should be offshored, while keeping the value proposition for the organization as a whole coherent. The decision to offshore work to locations such as India and China may often be initially driven by the need to leverage the cost differentials when compared to western sites, but evolve to focus on other key value levers such as access to talent and time to market. Given that globalization of product development projects is an organizational reality today, in order to remain competitive, organizations have to develop capabilities to successfully transition to this new way of working. Despite the prevalence of offshoring in large multi-nationals, there is limited understanding of the dynamics of standing up new sites. In this paper, we focus on identifying some of the key capabilities that organizations need to effectively offshore work, through a case study of the transfer of a product from the European site of large-multinational called Eurosoft to one of their Chinese sites. Starting with their strategic decision to offshore the development of the product, we study the critical actions undertaken as part of the transfer process and illustrate four types of organizational capabilities- technology (ability to understand and execute the project); process & tools (ways of working both within the organization and with clients); relationship management (ability to govern at both the project-level and at the relationship level); and knowledge management (ability to grow human capital, institutionalize best practices, and codify learning).

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