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Article
Publication date: 6 March 2017

Wendy L. Tate and Lydia Bals

The last decades have seen manufacturing and services offshoring on the rise, often motivated by low prices and without consideration of other important criteria such as…

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Abstract

Purpose

The last decades have seen manufacturing and services offshoring on the rise, often motivated by low prices and without consideration of other important criteria such as additional cost measures and risk. With wages in former low-cost countries and automation/robotization increasing, these decisions are increasingly contested. Re-evaluations of “shoring” decisions inherently create a need to re-examine theoretical and academic contributions to this rapidly changing phenomenon. Therefore, the special issue sought manuscripts that added to the exciting and dynamic body of knowledge on “rightshoring”. The paper aims to discuss this issue.

Design/methodology/approach

The paper starts out by delimiting outsourcing/insourcing and offshoring/reshoring as part of a conceptual “rightshoring” framework to establish a common terminology and context for the insights gathered in the special issue. It illustrates that “shoring” options can be classified along geographical and governance dimensions.

Findings

Both the geographical and governance dimensions are part of the rightshoring decision which is an important conceptual foundation for this special issue, as it invited insightful pieces on all of these phenomena (e.g. outsourcing, insourcing, offshoring, reshoring), acknowledging that these decisions are embedded in the same context – firms making governance and location decisions. Therefore, papers 1-4 primarily focus on offshoring, whereas paper 5 focuses on insourcing and paper 6 on reshoring. Their main findings are summarized in Table II.

Research limitations/implications

Suggestions for future research out of the six papers are summarized in Table III. There is ample opportunity to further shed light on these suggestions as well as to cover parts of the “rightshoring” framework presented, that remain less covered here (e.g. insourcing and/or reshoring).

Practical implications

The array of potential “rightshoring” options fosters clarity about the phenomena studied and their implications. The main practical implications of the six papers are summarized in Table II.

Originality/value

The overall conceptual framework highlights the positioning of the final papers included into the special issue and provides guidance to scholars and managers alike.

Details

International Journal of Physical Distribution & Logistics Management, vol. 47 no. 2/3
Type: Research Article
ISSN: 0960-0035

Keywords

Article
Publication date: 23 September 2022

This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.

Abstract

Purpose

This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.

Design/methodology/approach

This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.

Findings

The advent of new mobility technologies is having a major impact on location decisions within Spain's automotive industry. Firms continue to offshore manufacture of traditional components as part of ongoing aims at cost efficiency. But higher value activities are increasingly being relocated to country of origins plants to further innovation efforts, increase competitiveness and help in the implementation of measures designed to protect intellectual property.

Originality/value

The briefing saves busy executives and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

Details

Strategic Direction, vol. 38 no. 10
Type: Research Article
ISSN: 0258-0543

Keywords

Article
Publication date: 21 July 2022

Javier Turienzo and Jesús F. Lampón

The purpose of this paper is to analyze the new technologies that condition location strategy and enable the reindustrialization of European countries involved in the automotive…

Abstract

Purpose

The purpose of this paper is to analyze the new technologies that condition location strategy and enable the reindustrialization of European countries involved in the automotive industry. Business relocation has seen an upsurge in recent years. The development of the technologies linked to new mobility (connected, autonomous and electric vehicles) in European countries is increasing interest in relocating high value activities in origin countries to preserve high quality jobs and maintain competitive advantage.

Design/methodology/approach

The paper analyzes the changes in location factors and relocation trends through qualitative research based on a multiple case study methodology of first level suppliers in the automotive industry.

Findings

This study reveals the capacity technology has to reconfigure the automotive value chain and to change traditional location factors and relocation trends. The results show relevant differences between the traditional components production divisions characterized by offshoring processes, in a continuous decrease of activity and deindustrialization, and the new technologies divisions linked to new mobility with strong growth, reshoring of the high value activities, reindustrialization plans and links with research and development. For these new mobility divisions, protection of innovation to prevent the core knowledge transfer and strong collaboration with local research institutions are key in this highly technological location context.

Originality/value

The research analyzes the impact of new mobility technologies on the relocation processes in the automotive industry through an original approach based on the evolution of traditional suppliers with divisions linked to new mobility.

Details

Kybernetes, vol. 52 no. 11
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 19 February 2021

Hamid Moradlou, Hendrik Reefke, Heather Skipworth and Samuel Roscoe

This study investigates the impact of geopolitical disruptions on the manufacturing supply chain (SC) location decision of managers in UK multinational firms. The context of study…

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Abstract

Purpose

This study investigates the impact of geopolitical disruptions on the manufacturing supply chain (SC) location decision of managers in UK multinational firms. The context of study is the UK manufacturing sector and its response to the UK's decision to leave the European Union (EU), or Brexit.

Design/methodology/approach

The study adopts an abductive, theory elaboration approach and expands on Dunning's eclectic paradigm of international production. A Delphi study over four iterative rounds is conducted to gather and assess insights into manufacturing SC location issues related to Brexit. The panel consisted of 30 experts and managers from a range of key industries, consultancies, governmental organisations, and academia. The Delphi findings are triangulated using a focus group with 38 participants.

Findings

The findings indicate that the majority of companies planned or have relocated production facilities from the UK to the EU, and distribution centres (DCs) from the EU to the UK. This was because of market-seeking advantages (being close to major centres of demand, ease of access to local and international markets) and efficiency-seeking advantages (costs related to expected delays at ports, tariff and non-tariff barriers). Ownership and internalisation advantages, also suggested by the eclectic paradigm, did not play a role in the location decision.

Originality/value

The study elaborates on the OLI framework by showing that policy-related uncertainty is a primary influencing factor in the manufacturing location decision, outweighing the importance of uncertainty as an influencer of governance mode choices. The authors find that during geopolitical disruptions managers make location decisions in tight time-frames with incomplete and imperfect information, in situations of high perceived uncertainty. The study elaborates on the eclectic paradigm by explaining how managerial cognition and bounded rationality influence the manufacturing location decision-making process.

Details

International Journal of Operations & Production Management, vol. 41 no. 2
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 22 February 2021

This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.

290

Abstract

Design

This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.

Purpose

This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.

Findings

Offshoring, bringing operations back into the home nation of multinational enterprises, is becoming the prevailing mode of business, bringing an increased level of agility for the organizations.

Originality

The briefing saves busy executives, strategists and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

Details

Strategic Direction, vol. 37 no. 4
Type: Research Article
ISSN: 0258-0543

Keywords

Article
Publication date: 2 December 2020

Gregory Theyel and Kay H. Hofmann

This paper aims to investigate the strategic consequences of manufacturing location decisions, with a focus on understanding the link between collocating manufacturing with other…

Abstract

Purpose

This paper aims to investigate the strategic consequences of manufacturing location decisions, with a focus on understanding the link between collocating manufacturing with other value chain activities, via reshoring or retaining and organizational agility.

Design/methodology/approach

The paper uses qualitative data from 115 interviews with executives from UK high value manufacturing companies to explore the recent phenomenon of reshoring and the strategic effects of manufacturing location.

Findings

The location of manufacturing is operationally and strategically important for multinational companies. The spatial dispersion of manufacturing is determined by firm-specific and external factors, both of which are subject to constant change. The analysis shows that concentrating on manufacturing in their home countries enables firms to increase organizational agility and stimulate innovation. Better integration with and more extensive collaboration between related value chain activities, such as research and development, sales and marketing, leads to higher flexibility, speed and responsiveness to customer requirements. However, under certain conditions, firms also continue to benefit from the known advantages of offshoring.

Originality/value

This research sheds light on possible strategic downsides of global value chains, characterized by dispersed activities and intermitted processes. The results provide evidence that retaining manufacturing or bringing back manufacturing operations to a company’s home country can increase organizational flexibility, speed, adaptability, innovativeness and responsiveness to customer requirements. As these capabilities are critical for long-term survival, especially in dynamic environments, firms need to review their global factory configurations and determine whether the short-term advantages of foreign locations continue to justify offshoring practices.

Details

Multinational Business Review, vol. 29 no. 2
Type: Research Article
ISSN: 1525-383X

Keywords

Open Access
Article
Publication date: 24 August 2021

Matteo Podrecca, Guido Orzes, Marco Sartor and Guido Nassimbeni

This paper aims to offer a long-term systematic picture of the evolution of manufacturing offshoring (in terms of intensity, geography and drivers) highlighting the changes in the…

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Abstract

Purpose

This paper aims to offer a long-term systematic picture of the evolution of manufacturing offshoring (in terms of intensity, geography and drivers) highlighting the changes in the surrounding context and the resulting transitions points (“points in time”) that have shaped its development path.

Design/methodology/approach

Three statistical tools were adopted on a dataset of 644 cases. First, the authors resorted to multiple structural change tests to identify the transition points. Second, the authors explored offshoring geography by conducting a network analysis. Finally, the authors adopted gravity models to shed light on offshoring drivers.

Findings

Results highlight three offshoring phases: expansion (2002–2006), reconsideration (2007–2009) and rationalization (2010 onwards). During the first phase, characterized by economic growth, firms were mainly interested in economic savings; offshoring to low-cost countries was the prevailing location strategy. Subsequently, during the economic crisis, the number of cases declined and the main drivers became market-based factors together with the research for cost savings. Finally, in the third phase, when the economy was still stagnating and new manufacturing technologies appeared, the number of offshoring cases has further decreased, and technological- and market-based factors have become the main location drivers.

Originality/value

The study is the first to adopt a systematic, empirical and quantitative approach to analyze the evolution of the manufacturing offshoring considering both the phenomenon itself and the triggering changes in the surrounding context. In doing this, the authors also tested the importance of considering the point in time in offshoring strategies.

Details

Journal of Manufacturing Technology Management, vol. 32 no. 9
Type: Research Article
ISSN: 1741-038X

Keywords

Article
Publication date: 5 June 2018

Petchprakai Sirilertsuwan, Daniel Ekwall and Daniel Hjelmgren

The purpose of this paper is to reveal benefits and factors (elements) of proximity manufacturing that enhance triple bottom line (TBL) sustainability in the clothing industry and…

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Abstract

Purpose

The purpose of this paper is to reveal benefits and factors (elements) of proximity manufacturing that enhance triple bottom line (TBL) sustainability in the clothing industry and discusses previous proximity manufacturing studies.

Design/methodology/approach

A systematic review is used in searching and extracting data (primary studies artifacts and proximity manufacturing elements) from peer-reviewed articles. Extracted elements are gathered and analyzed in constructed tables under TBL. Four subgroups are inducted under the business bottom line.

Findings

This paper shows the potential of proximity manufacturing to enhance TBL sustainability, the scope of proximity manufacturing, and the trend and absence of existing studies. The most frequently mentioned elements are time-to-market, job creation, product quality, quick response, and trade policies. Governments and clusters are also important players.

Research limitations/implications

Future research can further explore elements potentially improving TBL sustainability to fill gaps in existing studies, including how proximity manufacturing can drive environmental and social practices, and how governments can encourage proximity manufacturing in various markets.

Practical implications

Besides perceiving the benefits of proximity manufacturing, businesses may use the derived elements to make manufacturing decisions.

Social implications

Public policies giving privileges to the locally produced garment industry have great potential to drive the economy and employment as well as sustain local clothing knowledge and the environment.

Originality/value

Proximity manufacturing strategies toward sustainability are under-researched academically and under-practiced industrially; this paper provides insight into sustainability benefits of proximity manufacturing.

Details

The International Journal of Logistics Management, vol. 29 no. 4
Type: Research Article
ISSN: 0957-4093

Keywords

Article
Publication date: 13 July 2018

Rudrajeet Pal, Sara Harper and Ann Vellesalu

The purpose of this paper is to identify and prioritise the success factors and challenges related to competitive manufacturing (CM) capabilities in a high-cost environment, and…

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Abstract

Purpose

The purpose of this paper is to identify and prioritise the success factors and challenges related to competitive manufacturing (CM) capabilities in a high-cost environment, and identify their potential to support future reshoring in textile and clothing (T&C) supply chains, with judgements from the practitioners’ perspective.

Design/methodology/approach

A Delphi study method is adopted with industry practitioners from the region of Western Sweden. Following a literature review on reshoring to identify relevant factors related to CM capabilities, a multiple round Delphi is designed to rank the success factors and challenges, and to further evaluate the likelihood of the success factors to lead to future reshoring. Additional semi-structured interviews are conducted to provide deeper explanation.

Findings

Empirical insights are both conforming to, and deviant from, evidences from extant literature. Moderate agreement is seen among the practitioners on the success factors; time- and product/process-related ones being ranked the highest. Low consensus is reached for the challenges, however, those related to high costs and lack of local resources were key concerns. Some anomalies from previous conception emerge among the challenges regarding increased costs of production, inventory and product variety trade-offs, and low skillset presence.

Research limitations/implications

The paper contributes to reshoring research by identifying and prioritising value-driven success factors and cost-related challenges to CM in high-cost environments, for labour-intensive T&C industries. In connection, some interesting paradoxes originate when dealing with multiple success factors.

Practical implications

Valuable insights are generated for informed decision making related to CM and future choice of its location.

Originality/value

Along with the decisive knowledge of the reshoring success factors and challenges, the study offers an interesting T&C practitioners’ perspective.

Details

The International Journal of Logistics Management, vol. 29 no. 4
Type: Research Article
ISSN: 0957-4093

Keywords

Article
Publication date: 19 February 2018

Paolo Barbieri, Francesco Ciabuschi, Luciano Fratocchi and Matteo Vignoli

The aim of this paper is to analyze and classify research that has been conducted on manufacturing reshoring, i.e. the decision to bring back to the home country production…

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Abstract

Purpose

The aim of this paper is to analyze and classify research that has been conducted on manufacturing reshoring, i.e. the decision to bring back to the home country production activities earlier offshored, independently of the governance mode (insourcing vs outsourcing). Consequently, the paper also aims at providing avenues for future research and to highlight the distinct value of studying manufacturing reshoring either per se or in combination with other constructs of the international business tradition.

Design/methodology/approach

A set of 57 carefully selected articles on manufacturing reshoring published in international journals or books indexed on Scopus in the past 10 years was systematically analyzed based on the “5Ws and 1H” (who-what-where-when-why and how) set of questions.

Findings

The authors’ work shows a certain convergence among authors regarding what reshoring is and what its key features and motivations are. In contrast, other related aspects, such as the decision-making and implementation processes, are comparatively less understood.

Research limitations/implications

As manufacturing reshoring is a “recent” topic, for some of its aspects, only exploratory research is available to date, limiting the authors’ possibility to either characterize it in a more exhaustive way or highlight well-established patterns.

Practical implications

The paper demonstrates that studying reshoring will indeed contribute to expanding our understanding of internationalization processes and strategies in general and of production internationalization specifically. While past studies have argued that the learning derived from international experience would permit firms to overcome their unfamiliarity with new business environments, reshoring might show that this outcome is not necessarily certain. Rather, firms might not be able to overcome obstacles because of internationalization or they might realize that attempting to do so is not desirable, e.g. because of excessive risk or changes in the firm’s strategic priorities.

Social implications

From a societal point of view, the present research underlines that reshoring can be part of that re-industrialization policy that many Western countries include in their economic agenda – yet, its impact on employment should not be overestimated, as often relocation is only in regard to some product lines. At the same time, there might be an intimate relationship between reshoring and the various forms of technological innovations applied to manufacturing – which has become popularly labeled as “Industry 4.0”.

Originality/value

Literature reviews proposed until now usually paid almost exclusive attention to motivations driving this phenomenon. This paper offers a broader and more comprehensive examination of the extant knowledge of manufacturing reshoring and identifies the main unresolved issues and knowledge gaps, which future research should investigate.

Details

Journal of Global Operations and Strategic Sourcing, vol. 11 no. 1
Type: Research Article
ISSN: 2398-5364

Keywords

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