Organizational Learning and Organizational Capabilities of Firms that Engage in Onshore and Offshore Business Process Outsourcing

Abstract

Firms are increasingly using onshore and offshore business process outsourcing (BPO) to manage their front and back office functions. While most IS research uses transaction cost economics (TCE) to study the transaction-level characteristics that facilitate outsourcing, to advance theory there is a need to focus on the firm-level characteristics that facilitate onshore and offshore BPO. This paper builds on prior research in organizational learning and organizational capabilities to propose a theoretical framework for adoption of onshore and offshore BPO, and tests the framework using archival data.