| The economic downturn in the United States has forced many organizations, both private and public, to evaluate when to outsource and when to keep functions in-house. The purpose of this phenomenological study was to document the lived experiences, perceptions, and knowledge of a purposive sample of 20 small defense contractors in the Washington, DC area on the effect of the Department of Defense (DOD) insourcing initiative and the subsequent strategic plans that were implemented by these defense contractors. The transaction cost theory, which suggests that organizational functions and operations must be performed to minimize production and transaction cost, served as the conceptual framework of this research. After analyzing the interviews transcripts, several themes emerged related to the perceived federal government benefits from insourcing; the perceived disadvantages of insourcing to federal government operations; and the effects of the insourcing initiative on small, private sector contractors. The recommendation to the DOD executive leadership is to conduct a thorough analysis of the skill set of the current DOD workforce and develop the necessary training commensurate with the positions and adequate training compliance plan. Implications for positive social change include promoting greater awareness of the insourcing initiative, especially in the DOD. This greater awareness could highlight areas of concern from the DOD contractors' perspectives, which could strengthen the relationship between the defense departments and the private industries, improve the sustainability of public trust, and address the underlining implications of the insourcing and outsourcing phenomenon. |
