Factors Determining Outsourcing Effectiveness: with Reference to the Sri Lankan Apparel Sector

Abstract

Over the last two decades, organisations have given tremendous attention to outsourcing to improve operational efficiencies. Necessity has risen for organisations to continuously focus on core activities to remain competitive in the marketplace. Outsourcing has become a common business strategy in many industries, including Textile and Apparel. The extant literature has predominantly focused on how outsourcing influences the overall production process and the outsourcing of production activities to developing countries by well-known apparel brands. The present study aims to identify factors determining the outsourcing effectiveness in the Sri Lankan Apparel sector. The data collection for this study was carried out using qualitative methodology and in-depth interviews. Seven employees in senior executive and managerial levels were interviewed using a semi-structured interview guide. The data were analysed using thematic analysis. The findings revealed four main themes: the quality of the product, labour cost, lead time and responsibility. The findings of this study provide practitioners with information on the essential components to consider when selecting outsourced parties and managing outsource agreements.