Outsourcing relationship management: accounting in the decision mix
ISSN: 0275-6668
Article publication date: 22 October 2018
Issue publication date: 9 November 2018
Abstract
Purpose
The paper aims to examine the role of management accounting and accounting information in decisions to outsource and manage outsourcing relationships.
Design/methodology/approach
The paper uses a case study method. Data are collected through semi-structured interviews and informal discussions with executives of the participating companies. Official documents and secondary materials were analysed.
Findings
The findings of these cases present evidence of some roles given to accounting information and varying tasks assumed by accountants and finance staff in the outsourcing projects undertaken. These roles and tasks range from financial evaluation of new outsourcing proposals and alternatives, consultation and price negotiations in the planning and feasibility stages to the management of outsourcing relationships including monitoring, cost analysis, performance measurement, internal audit, design and implementation of risk-reward payment schemes. Managing the outsourced functions in one case involved in the use of informal control mechanisms such as trust, knowledge sharing, mutual understanding and cooperation between partners.
Practical implications
The paper highlights the role of management accounting and information in outsourcing relationship management and evaluation. The case findings provide the opportunity for management practitioners to understand the strategic role of management accountants in the management of inter-firm relationships.
Originality/value
The case study presents new empirical evidence of the role of management accounting and accounting information in the management control of outsourcing relationships.
Keywords
Citation
Ahmed, M.N. (2018), "Outsourcing relationship management: accounting in the decision mix", Journal of Business Strategy, Vol. 39 No. 5, pp. 41-49. https://doi.org/10.1108/JBS-03-2018-0049
Publisher
:Emerald Publishing Limited
Copyright © 2018, Emerald Publishing Limited