Collaborating across Boundaries in a Global Economy: Do Organizational Boundaries and Country Contexts Matter?

As firms spend a growing part of their budgets on offshore activities, they experience pressure to source increasingly more complex, less codified, and more strategic IT projects abroad. Successfully completing such projects requires close collaboration among all participants. It has been argued that firms are better off keeping such projects within their organizational boundaries by setting up captive offshore development centers, especially if these firms have sufficient scale. This paper presents a qualitative case study of a large financial services organization that used both captive centers and third-party vendors in multiple global locations to deliver its IT projects. Using a grounded theory approach, it highlights the kinds of organizational practices that helped this firm accomplish global collaboration. Surprisingly, the data indicates that achieving effective collaboration did not depend on whether the project was kept within the firm’s boundaries, nor did it depend on choosing a specific offshore location. Instead, effective collaboration was facilitated by specific middle managers who engaged in boundary-spanning practices across countries and firms