Outsourcing and insourcing of organizational activities: the role of outsourcing process mechanisms

The decision to outsource organizational activities is studied widely, but research on the insourcing of outsourced activities is scarce. We study the outsourcing decision as a process, and investigate the influences of organizational mechanisms on its sustainability. We argue that organizational learning from the outsourcing decision process could over time result in competencies that enhance the sustainability of outsourcing decisions. We examine outsourcing and insourcing processes longitudinally. The results indicate that the outsourcing process mechanisms, especially the mechanisms associated with implementing the outsourcing decision, predict insourcing. We discuss the implications for future research on outsourcing and insourcing of public services.