Framework for Outsourcing: Based on Theoretical Review and Empirical Findings from Danish Heavy Industry

This paper examines the process of outsourcing manufacturing to cost-efficient and innovative suppliers in support of internal core competencies. A framework that links the phases of the entire outsourcing process to strategic planning is presented. The framework includes a logical sequence of key activities with built-in performance measures and expected output for each of the phases. In addition, it indicates the critical workflow interfaces between the production system and relevant support functions to determine the cross-functional interdependencies. Collectively, the framework aims to facilitate start-up, operations and maintenance of the buyersupplier relationship. The research methodology is rooted in an in-depth theory study and a longitudinal case study of the Danish company Aalborg Industries, which operates in the heavy industry. Thereby, the research pursues both academic and industrial application.