ered for their outsourcing opportunity, especially during the preparation
phase.
Therefore, this paper seeks to enrich this research by examining the
ways in which the identification of key success factors in outsourcing occurs.
The content of the study provides a brief description of outsourcing
and logistics outsourcing. The literature relevant to outsourcing is then
reviewed. A set of outsourcing key success factors that are considered by
different authors are proposed and a ‘Partnership Model’ is used to illustrate
factors which need to be present in outsourcing relationships.
Three case studies examples from the logistics industry are used to show
the application of the ‘Partnership Model.’ This includes a discussion of
how outsourcing companies might better define and develop successful
logistics outsourcing relationships.
Theory and Hypotheses
It is important to understand why some logistics outsourcing relationships
work well and why others fail. A careful review of existing literature
reveals a mismatch between theory and practice in outsourcing.
In order to help minimize the chance of failure in an outsourcing relationship,
the ‘PartnershipModel’ was developed (Lambert, Emmelhainz
and Gardner 1999). While this model cannot guarantee that all partnerships
are successful, it can serve as a powerful tool for logistics managers
to develop and maintain effective relationships. Other authors (Greaver
1999) have proposed the implementation of ‘The Seven Steps to Successful
Outsourcing.’ Methodology, which, in their opinion, is critical to
successful outsourcing (Planning Initiatives, Exploring Strategic Implications,
Analyzing Cost/Performance, Selecting Providers, Negotiating
Terms, Transitioning resources,Managing relationships). Others (Mayer
Brown 2003) state that outsourcing companies should streamline operations
and fix the problems before outsourcing the process. They should
not transfer key employees to the vendor. It is also important that they
manage the relationship, plan adequately for the co-management process
and establish control points.
Rosenthal (2000) discovered that logistics service providers are often
too rigid when it comes to change. They do not put enough emphasis
on pricing strategies and they have to learn how to build alliances and
be frank about them. They put too much focus on service levels and not
enough on strategy. Reagan and Chauanxu (2002) advise outsourcing
companies to pay attention to identifying hidden risks and preventive measures.