The effect of Outsourcing on Organizational Performance: the case of International Livestock Research Institute /ILRI-Addis Ababa
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Date
2019-05
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A.A.U
Abstract
In recent years, global economic challenge with resource limitations is increasingly growing pressure on competitive advantage of firm. Organizations need to find strong ways to deal with this changing environment. The success of organization depends greatly on many factors such as productivity, cost efficiency and successful strategic human resource management. With dynamic environment, outsourcing turns to be an important tool of strategic management of firm. Therefore, this study is aimed to explain the impact of outsourcing dimensions (cost driven outsourcing, innovation driven outsourcing, focus on core competencies driven outsourcing and quality driven outsourcing) on organizational performance, by focusing on International Livestock Research Institute/ILRI-Addis Ababa. A conceptual framework was used as a guideline to test the relationships between outsourcing dimensions and organizational performance. A quantitative approach is chosen in this research. In order to collect primary data, a questionnaire is designed and was given to the staff of ILRI. The target populations of the study were all ILRI permanent employees in Addis Ababa. Out of 200 distributed only 186 complete questionnaires were used for analysis. The SPSS version 20.00 for windows is used to process the data which is collected through questionnaire. Regression analysis was used to test the significance contribution of each independent variable to the dependent variable of organizational performance. The findings show that cost driven outsourcing, focus on core competencies driven outsourcing and quality driven outsourcing dimensions have significant and positive impact on organizational performance. However, the innovation driven outsourcing is positively but not significantly effect to organizational performance in ILRI-Addis Ababa. Therefore, ILRI should outsource with a clear picture in mind as to why it wants to outsource. When ILRI outsources it should have measurable indicators in form of Key Performance Indicators for the service provider.
Description
A Thesis Submitted to Department of Management for the Partial Fulfillment of the Required for the Award of Masters of Arts Degree in Business Administration
Keywords
Cost driven outsourcing, Focus on core competencies driven outsourcing, Innovation driven outsourcing