Mechanisms to Implement a Global Multisourcing Strategy

Many multinational enterprises apply multisourcing approaches and both practitioner-related and scholarly literature has identified multisourcing as an emerging key strategy. Multisourcing is described as the blending of services from multiple company-internal and company-external suppliers. Despite its relevance, current literature lacks depth in terms of implementing multisourcing and only a few articles describe multisourcing strategies in detail. Especially, multisourcing in a group-context is scarcely covered. This research study contributes to the body of knowledge by analyzing the case of a worldwide leading financial services provider. This article describes mechanisms that support the implementation of a global multisourcing strategy at a business group with a federal IT organization and provides insights into a real-life example of global multisourcing. Propositions on governance aspects for multisourcing are derived and a split of activities between the group center and the business entities is suggested. In particular, the organizational setup of a business group – with the numerous business entities and the federal governance model – determines the multisourcing strategy and the split of activities. Hence, this research also helps practitioners facing similar challenges.