The outsourcing strategies

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Western companies have become keenly aware that the outsourcing strategies in the past 20 years have created unintended consequences. Recent studies point out, as western companies outsource manufacturing to emerging economies such as China, Brazil, India, they also give away innovation capability. This phenomenon is not new -- SONY, Samsung, and LG were contract manufacturers in the 1970s and 1980s. These days we see Leveno, Foxconn and Wanxiang America (a Chinese automotive battery maker) are playing an increasing role in engineering innovation and product design. Please identify and discuss the reasons how certain outsourcing strategies have led to diminishing innovation capabilities of the buying (U.S.) firms and even the whole industry sectors in the U.S.

Reference no: EM131143315

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