Offshoring has been studied widely in the literature on strategic management and international business. However, apart from its consideration as an administrative activity, scant attention has been paid to the offshoring of the human resource (HR) function. Research in this regard has instead focussed on outsourcing (Reichel and Lazarova, 2013). The purpose of this paper is to achieve a better understanding of companies’ decisions to offshore HR activities. It adapts the outsourcing model of Baron and Kreps (1999) by including the HR offshoring phenomenon and a dynamic perspective.
While the analysis is mostly conceptual, the authors ground the author’s arguments in offshoring data from the Offshoring Research Network, to explore whether the drivers for offshoring HR differ from the drivers for offshoring other administrative activities. The idiosyncrasy of the HR function is supported by the authors’ exploratory analysis and also by the descriptive case of a multinational and its experience with offshoring.
A coevolutionary model is proposed for understanding the behaviour of companies offshoring their HR activities. This study contends that companies should address their decision to offshore HR activities from a dynamic perspective, being aware of three processes that are in constant change: the evolution of the HR function, the evolution of service providers, and the evolution of offshoring decisions.
This study seeks to make a threefold contribution to the international business, strategy, and HR management disciplines.
The authors acknowledge the Offshoring Research Network as the originator and the distributor of the data. This organization does not bear any responsibility for the authors’ analysis and interpretations of the data. The authors appreciate financial support received from the Spanish Ministry of Economy and Competitiveness through Grant No. ECO2015-68343-R. The authors would also like to thank Guest-Editor Wendy L. Tate and the three anonymous reviewers for their insightful and constructive comments throughout the review process.
Paz-Aparicio, C., Ricart, J.E. and Bonache, J. (2017), "Understanding the decision to offshore human resource activities: a coevolutionary perspective", International Journal of Physical Distribution & Logistics Management, Vol. 47 No. 2/3, pp. 175-197. https://doi.org/10.1108/IJPDLM-09-2015-0224Download as .RIS
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