Exploring the impact of outsourcing on organizational performance
Journal of Global Operations and Strategic Sourcing
ISSN: 2398-5364
Article publication date: 20 November 2017
Abstract
Purpose
The need for businesses to gain profit through the provision of high-quality services has driven the organizations to outsource business activities and functions that are considered not integral to the core business. The purpose of this paper is to identify key outsourced activities and to explore their influence on the organizational performance of the targeted locally owned oil and gas companies in Ghana. Also, the study explores key benefits and challenges associated with adopting outsourcing strategies.
Design/methodology/approach
The primary data were collected using a survey from 80 participants working for different oil and gas companies in Ghana.
Findings
The study revealed that most of the outsourced activities include transport services, information technology (IT) consulting and business consulting services, system infrastructure provision and management and logistical services. Also, key outsourcing reasons were reducing operational costs, avoiding major investment costs in technology, providing consistent and improved service delivery, accessing current technology and expert knowledge and focusing more on core business activities. Outsourcing is significant to enhance the performance of an oil and gas company; however, outsourcing could also result in the conflict of firm culture with outsourced vendors, and inefficient management and loss of innovative capacity are possible negative effects of outsourcing.
Research limitations/implications
The study targeted mainly locally owned oil and gas companies operating in Greater Accra regions of Ghana and including other areas is recommended in the future. Also, the research sample size was 80 participants for this study, and a larger sample should be used in the future.
Originality/value
There is a paucity of research in management outsourcing in Ghana’s oil and gas industry. To the best knowledge of the authors, this study presents the first research of its kind and the findings will be valuable for the targeted companies. The results from this study can also be used by other companies operating in similar oil and gas business environments operating in other oil and gas producing countries particularly in Africa and Asia. Also, the result from this study can greatly benefit other companies already adopting, or considering adopting, outsourcing and operate in similar service-providing sectors within Ghana or in other countries with similar business environments.
Keywords
Citation
Nyameboame, J. and Haddud, A. (2017), "Exploring the impact of outsourcing on organizational performance", Journal of Global Operations and Strategic Sourcing, Vol. 10 No. 3, pp. 362-387. https://doi.org/10.1108/JGOSS-01-2017-0001
Publisher
:Emerald Publishing Limited
Copyright © 2017, Emerald Publishing Limited