In the C-Suite: The dawn of deglobalisation
Harvard Business Review recently lamented on how destructive outsourcing in respect of high –tech manufacturing has led to the US losing its competitive edge.
With outsourcing goes the associated skill, knowledge and R&D investment.; usually in an easterly direction.
It seems logical of course to outsource ‘low value’ activity such as the production of chips, routers and PCs. But before you know it the design of such products are also outsourced. And thus the direction in which these markets evolve is then beyond your control.
The R&D associated with these low value technologies goes on to generate the high value-high opportunity technologies such as electronic paper, thin-film solar powered cells and sophisticated mobile handsets.
It would appear that the elastic band of outsourcing is at full stretch with a reversal in trend imminent.
Business-leaders might also apply this thinking to their IT investment. Whilst short term cost savings might be achieved, the associated business wisdom once jettisoned will be difficult to retrieve.
