Leveraging Offshoring: The Identification of New Business Opportunities in International Settings

This work aims to shed light on the process through which small and medium-sized enterprises (SMEs) identify new business opportunities within their ongoing offshoring activities. Empirical evidence is drawn on the case of think3, an Italian medium-sized software company that has been offshoring its R&D activities to Bangalore, India, since the year 2000. In 2004, the company started a brand new “global” business: from selling software solutions for computer-aided design, it began selling the engineering capabilities to use its solutions, leveraging highly qualified Indian mechanical engineers. Our analysis underlines three elements underpinning think3's ability in envisaging a new profitable business opportunity. These are its experiential knowledge of: (a) the markets, clients and competitors, (b) the offshore context, and (c) the internationalization process as a software house, embodied in the ability to promote offshore cultural integration and to align home and offshore operations. This study enables a better understanding of the factors triggering the recognition of new business opportunities by SMEs, at the international level.