Linkages between service sourcing decisions and competitive advantage: A review, propositions, and illustrating cases

This paper focuses on linkages between strategic service sourcing decisions and the competitiveness of business firms. It responds to calls for more research focusing on the outcomes of services and the nature and durability of service benefits and contributes with relatively comprehensive, detailed and managerially oriented knowledge regarding the linkages between service sourcing and competitive advantage. The paper reviews the literature and develops propositions regarding how different make-or-buy decisions, supply-base structures, and types of buyer-seller relationships influence the possibility of simultaneously maintaining positive bonds with customers, keeping costs low, and developing valued and differentiated offerings. The practical applications of the propositions are illustrated with four case studies.