THE RELATIVE IMPORTANCE OF BREADTH AND DEPTH OF OUTSOURCING: AN EMPIRICAL STUDY IN THE HOTEL INDUSTRY

Abstract

The degree of outsourcing is one of the most fundamental decisions in outsourcing as it determines the firm‟s level of dependency on external resource. The appropriate level of degree of outsourcing is determined by its breadth and depth. Thus the purpose of this study is to identify relative impact of breadth and depth of outsourcing on outsourcing success. Cross-sectional data was collected through a survey of managers in the hotel sector in Sri Lanka using self-administered structured questionnaires. A total of 184 usable responses were collected. Structural Equation Modelling (SEM) was used to analyse the survey responses. Based on the empirical data, the study found that only breadth has significant impact of outsourcing success.The optimal level of outsourcing success is reported from high breadth and medium depth of outsourcing. Accordingly, this study extents the understanding of the impact of breadth and depth in determining degree of outsourcing for outsourcing success. The paper also explains some managerial implications for hotel managers.

Keywords: Breadth, Depth, Degree of Outsourcing, Outsourcing Success, Services

For full Paper: fmscresearch@sjp.ac.lk