Study On Decision Models In Outsourcing

As globalization, diversification of products and progress of science and technology, social division of labor is becoming finely and finely day by day, and market competition is more widespread and intense, it's difficult for enterprise to match the changing market demand and competition only relies on its own abilities and resources. Therefore, how to strengthen market competitive ability by combining outside resources and inside core competence becomes one of company's realistic issues.As an efficient tool for combining inside and outside resources, more and more business managers had implemented outsourcing for their activities. Both business managers and management consultants are trying to address the outsourcing issues. Unfortunately, the academic literature provides limited directions in this area. In addition, there is a dearth of literature that addresses outsourcing decision making process in a quantitative way.This dissertation is aimed at addressing three of the more important decision issues pertaining to the outsourcing process. First, a decision model is proposed how to indentify company's core activities. Second, a decision model is developed to help decision maker how to make outsourcing project planning. Third, a decision model is given to help decision maker to select outsourcing vendor scientifically. The main works are as fellows:In outsourcing theory, it defines the outsourcing from strategic perspective, it presents that existing outsourcing theories explain the outsourcing phenomenon from perspectives of economics, strategy management and sociology. Because alternative theories, including strategic, economic and social, provide insight into the complexity of variables that need to be studied from different side and they are complementary to each other, in order to considered decisive factors about outsourcing fully and systematically, an integrated model of outsourcing is developed, which can be used to direct empirical research. It points out that the strategic factors should be first considered in all the factors, then the economic factor and finally the social factors. At last, motivations and risks of outsourcing are presented. In core activity identification, from integrative view of economics and strategy, this dissertation presents that characteristics of the core activities are collectiveness and uniqueness. ELECTREⅠis improved by introducing two definitions——superior number and inferior number. According to the core activities' characters, two core activity identification models are developed, one is based on the improved ELECTREⅠ, the other is based on system analysis. A case study on manufacturing company is given to illustrate the availability of the presented models.In outsourcing project planning, aiming at the ranking problems in ELECTREⅢ, a new ranking method is developed by introducing three definitions—concordance credibility degree, discordance credibility degree and net credibility degree, into ELECTREⅢmethod. An application is given to illustrate the reasonability and availability of the proposed method. And then, it argues that five factors, including economics, environment, risk, strategy and management, should be considered for outsourcing decisions. According to the decision factors and different features between AHP and ELECTREⅢ, a hybrid multi-criteria decision method is developed as aids in making outsourcing project planning. It shows by means of an application that the hybrid method is very well suited as a decision-making tool as aids in making outsourcing project planning.In outsourcing vendor selection, a process of outsourcing vendor selection is given, and an indicator system for outsourcing vendor selection is set from factors of cost, quality, strategy and culture, etc, which considered outsourcing strategy fully. Given the multiple criteria nature of vendor selection decision, an outsourcing vendor selection decision model is proposed, which integrated AHP and PROMETHEEⅡ. GAIA's visual interactive modeling technique can identify conflicts between the criteria; it's used to be a tool for sensitivity analysis. An application is given to illustrate the proposed method, the whole vendor selection model presented, is a useful tool for the outsourcing vendor selection problem.There are some fields which should be studied in depth about outsourcing decision. Some further research issues are put forward at the end of this dissertation.The main contribution of this study to academia is to provide research models to the future researchers who are interested in this domain. Besides, firms can also adopt the study outcome to ensure the success of their outsourcing strategy.