Global Sourcing of Services and Market Performance: An Empirical Investigation

Using mail survey of Fortune 500 U.S. service firms and their major affiliates as a basis, Kotabe, Murray, and Javalgi find that internal sourcing of supplementary services is not influenced by the same factors as finished-goods sourcing. It was determined, however, that foreign sourcing of supplementary services is affected by the external availability of core services. Moreover, both strategic and financial performance are affected negatively by the degree of internal sourcing and foreign sourcing of supplementary services.