In recent years outsourcing gained more and more interest in media, politics and among academics. Technological developments, increasing costs and globalizing competition have motivated multinational companies to fragment their value chain and to offshore outsource the production of parts and components as well as services to distant locations. Central and Eastern European countries, especially Poland, and China are well known as attractive offshore locations in manufacturing industries, but both seem to lose competitiveness in this field. They are striving for new competitive advantages in selected financial services that might challenge India’s leading position as a global service provider.
Decisions on offshore outsourcing services in the banking sector have to take into account a more complex bundle of criteria than in manufacturing industries ranging from special risks, restrictive legal framework to service-oriented mentality.
A closer look through the literature shows that firstly there is a lack of theoretical work on offshore outsourcing in the financial industry. Secondly, empirical studies focus primarily on advising banks rather than analysing global trends, national/local competitive advantages/disadvantages, comparing locations etc.
Despite problems in collecting primary data, especially in China, that are based on a structured questionnaire and interviews, the result of the study shows considerable differences between Poland and China when it comes to offshore outsourcing. China’s lack of a well developed service industry, its special risks in the field of IPR, the dominance of state-owned banks, and last but not least the legal restrictions for doing business for foreign banks weaken this country’s competitive position as an attractive offshore outsourcing location. According to bank’s evaluation of several risk categories, Poland and China differs significantly. Aspects of cost savings seem to play a more prominent role in Poland than in China, whereas risk avoidance is more important in China than in Poland. The services that are and will be outsourced are more complex in Poland than in China. But in both countries outsourcing in the banking sector seems to gain importance.
Author: Guenter Heiduk, Mariusz-Jan Radlo, Lijuan Zhang
Publisher: Warsaw School of Economics
ISBN/ISSN: 978-83-7378-639-4
Language: English
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