Outsourcing vs insourcing in the human resource supply chain: a comparison of five generic models

Tom Kosnik · Diana J. Wong‐MingJi · Kristine F. Hoover

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Outsourcing and Supply Chain Management Human Resource and Talent Management Employer Branding and e-HRM

Abstract

Purpose The purpose of this paper is to develop a typology of human resource supply chain (HRSC) models that enable comparison of different models for making more informed strategic HR outsourcing decisions. Design/methodology/approach In the paper interviews and company documents were used to construct multiple comparative case studies. Findings The paper finds that five generic HRSC models were identified in two broad categories – two in‐sourcing models (local contracting and HR centralizing) and three outsourcing models (purchasing HR, non‐staffing HR, and staffing HR). Additional findings relate to the redistribution of power and competencies for managing HR within and between organizations. Research limitations/implications The paper shows that future research should account for different HRSC models to address various dependent variables, especially distribution of power and HR competencies in managing HR supply chains and contribution to firm performance. Future studies on strategic alliances can benefit from building on the HRSC models in building different types of partnerships. Practical implications In this paper it is found that managers have a means for comparison of different HRSC models to make more fully informed strategic outsourcing decisions and to develop related HR competencies related to each one of the generic models. Originality/value This paper clarifies critical differences in five different generic HRSC models that must be accounted for in research on strategic HR and outsourcing. Without understanding the differences in HRSCs, managers often unwittingly relinquish power and control over critical HR functions to other organizational units or vendor organizations.

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References

1984Case Study Research: Design and Methods 1995THE IMPACT OF HUMAN RESOURCE MANAGEMENT PRACTICES ON TURNOVER, PRODUCTIVITY, AND CORPORATE FINANCIAL PERFORMANCE.1998Toward a social context theory of the human resource management-organization effectiveness relationship 2003Making the HR Outsourcing Decision 1999HR OUTSOURCING AND ITS IMPACT: THE ROLE OF TRANSACTION COSTS 1997An Analysis of Managerial Motivations Behind Outsourcing Practices in Human Resources 2001Managing Strategic Outsourcing in the Healthcare Industry 1994From personnel management to strategic human resource management

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