Knowledge Management in Outsourcing - Research Paper Example

One of the developments in management theory is the belief that most firms have only a few “core competencies” where they possess exceptional skills and abilities, therefore in order to sustain a competitive advantage in an increasingly cutthroat global economy, it is better to hire firms with their own core competencies to perform other tasks that are required as a part of organizational activity. Thus, in order to sustain a competitive advantage in the global marketplace, outsourcing is an operational strategy that many Companies are resorting to, by hiring firms with their own core competencies in other countries to perform business processes for them in a more cost-effective manner.

According to Nonaka (1998), the uncertainty in the global environment means that the only aspect that is guaranteed to always provide a competitive advantage to a firm is knowledge; hence knowledge management through outsourcing is an organizational tool to achieve innovation and competitiveness. India has emerged as one of the target destinations for many Corporations in the United States and Europe, to outsource their business process activities, due to the availability of a skilled workforce that is also relatively inexpensive.

While many services are being outsourced, the objective of this dissertation is to examine knowledge management as a component of outsourcing decisions in call center operations. This study examines knowledge management in call centers and concludes that while explicit knowledge is being effectively dispersed, there is a need to improve the management of both cultural and tacit knowledge within Indian call centers in Mumbai.