chapter  9
12 Pages

Flextronics Case Study: International Sourcing: Organizational Dilemmas

ByYina Li, Xuejun Xu, Fei Ye, Qian Wang

IS is a very topical issue. Market globalization, communication technology and transport system development, as well as the reduction of international trade boundaries favoured purchasing abroad or, in some instances, reduced restrictions that hindered its development in the past. Business experiences show that IS is now considered to be a strategic opportunity aimed at achieving a sustainable competitive advantage, while in the past it was simply an occasional process linked to the need to reduce costs. However, IS requires a proper organizational and information infrastructure, effective coordination mechanisms and logistics capabilities. Moreover, through IS, companies have to face recurring problems, for example cultural and communication barriers, longer supplying lead times, higher transport costs, risks linked to business transactions with different contact people and different regulations. In spite of the increasing importance of this phenomenon, the literature lacks empirical studies and models providing companies with cognitive and normative references through which they may decide to adopt IS.