| dc.description.abstract | The twenty first centry is a fast growing era for China, with its Shanghai Stock Index skyrocketing from the previous two thousand points to its current peak about six thousand points. With the implementation of new tax and labor laws, China is no longer seen as a place for companies to exploit its cheap labor, and thus bring us to attention that immediate measures must be taken for companies to be strategically and productively competitive. The purpose of this research is, through relevant theoretical lenses, to identify the factors that may influence a company outsourcing strategies and the outcomes. We conduct a case study on a company which is a leader in the cooling tower industry. By investigating the outsourcing process and activities of this company, we endeavor to comprehend the underlying factors that make up the current outsourcing tactics, assess the performance level of outsourcing achieved and discuss the underlying problems that affect the success and failure of this outsourcing decision and its execution. Through this research, we are able to compare and examine the relations between the mentioned theories to the actual outcome of outsourcing and suggest the possible problems and their remedies for companies when developing their own outsourcing plans. The theories examined include Transaction Cost Theory, social relationship, reptation, and Contract. In this research, we have found and concluded that: 1) Transaction Cost Theory is reasonable theoretical lens for analyzing outsourcing decision-making structure and formulation; 2) reputation of the subcontracted company (referred as subcontractor) affects the “social relationships” between the outsourcer and the subcontractor; 3) when there is high “asset specification” for the outsourcer, chances for “opportunism” are relatively low for subcontractor; 4) when any level of “uncertainty” exists in outsourcing formulation or execution, the chance for outsourcing to go wrong increases; 5) from the Transaction Cost Theory, when the social relationship of the outsourcer and subcontractor are tight, outsourcing itself becomes more likely to generate positive value. | en_US |