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Article
Publication date: 10 June 2020

Suvituulia Taponen and Katri Kauppi

The purpose of this paper is to compare service outsourcing decisions between public and private organizations and against a theoretical decision-making framework to both…

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Abstract

Purpose

The purpose of this paper is to compare service outsourcing decisions between public and private organizations and against a theoretical decision-making framework to both understand differences across the sectors and to provide an outsourcing framework more suitable specifically for outsourcing (and for the public sector).

Design/methodology/approach

Multiple case studies, i.e. a study of phenomena (here outsourcing process) at various sites is used as an approach.

Findings

Findings indicate that public sector organizations are trailing behind private sector organizations in how the decision-making process is conducted and resourced. The authors suggest regular evaluation of service functions internally as a starting point for the outsourcing service decision-making process. Additionally, the market analysis should be done prior to cost analysis and benchmarking as the availability of suppliers more qualified than the internal process defines the make or buy decision.

Research limitations/implications

The newly developed framework based on empirical evidence includes the following phases: regular evaluation of service functions, market analysis, cost analysis and benchmarking and evaluating relevant service activities. Applying the framework improves the efficient delivery of outsourced public services and brings public sector outsourcing closer to the professionalism currently present in the private sector.

Originality/value

Choosing between in-house and outsourced service delivery is a fundamental decision in both private and public sector organizations. Previous outsourcing research has mostly focused on the private sector, with limited focus on the public sector’s outsourcing processes, yet understanding of the service outsourcing process is important in ensuring organizational competitiveness and cost efficiency.

Details

Journal of Global Operations and Strategic Sourcing, vol. 13 no. 2
Type: Research Article
ISSN: 2398-5364

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