Offshoring Governance Modes

Offshoring concerns the relocation of white-collar §business processes from one country to another. §Research about the business- and economic rationales §of this strategy is abundant; yet we cannot §sufficiently explain offshoring governance decisions §and their consequences. This book elaborates on the §antecedents of the mode of governance in offshoring, §i.e., it addresses the question whether offshoring §is performed in-house with a captive entity, or §with the support of a third-party service provider. §Building on the insights into this make-or-buy §decision, this book further tackles the nature of §client-service provider relationships. The §literature suggests that in external service §relationships (such as, for instance, auditing), the §dissolution of contracts is a rare event. I assume §that offshoring relationships are similar in this §regard. In order to facilitate the longevity of the §relationships, mechanisms that aim at reducing §potential agency costs need to be put in place. I §will provide an empirical explanation for the §sustainability of relationships between clients and §service providers in offshoring.