Outsourcing: insights from the telecommunications industry

The aim of this research is to identify the drivers and processes that can influence the outsourcing process in the telecommunications industry. The research focuses on a telecommunications equipment manufacturer that has outsourced a range of activities to suppliers including assembly operations, manufacturing, logistics and design. This strategy has resulted in the company becoming a “systems integrator” in which it manages and co‐ordinates a network of best production and service providers. The implications of this strategy are drawn from an analysis of this company and three suppliers by analysing three outsourcing programmes over an 18‐month period. There is considerable focus on evaluating the capability of activities in the value chain in relation to potential suppliers. The findings in this research challenge the value of using the core competence concept as a basis for outsourcing. In fact, the findings show that analysis and management of the supply chain can have a greater impact on the outsourcing process than attempting to unravel the complexities and intricacies of the core competence approach.