Monday, August 26, 2013

Lesson # 53 : Going East

Everything that we see around us be it the television, the ipad, the iphone, the kindle or even the very laptop that the author is using to type this article all of these have a common thread running through each of them. Apart from being modern marvels of the 21st century each of these have been manufactured in China.

Most of the readers at this point of time shall put forward the simple question, "So what's the big deal?"

This trend is an indication of where the world is headed. A greater number of American Corporations are outsourcing or rather already have successfully outsourced their manufacturing to China.

While this trend has been seen primarily in Electronics other industries such as Clothing, Footwear etc are also following suit.

This in itself has created a sort of Symbiotic relationship between the creators and the manufacturers.

We need to clearly establish that if we are taking the example of Apple and their Iphone. Then in this case while the world may predominantly think that the Iphone was manufactured by Apple what must be stated is that Apple is simply the creator.

Hence, generalising this we can state that the creator is a company that is behind the research and development of the product, it is also in charge of marketing and selling the product, it is even in charge of after sales service and repairs. But the creator is not in charge of manufacturing the product.

The world over it is known that a greater number of Apple products are manufactured by Foxconn. Hence, in this case Foxconn is the manufacturer and not Apple.

This simple example is an indicator of where the world is headed. Most of the big brands of the world would rather spend on research and development rather than manufacture good solid hardware.

Though, this trend is now slowly seeing a change with Motorola deciding to set up a factory and employ local workers from nearby states in the US.

What needs to be seen however in the coming years is whether if large corporations shall be able to balance out their research and development and new products with good solid hardware manufacturing done locally in factories set up in the country of origin of these global conglomerates.

On behalf of Doodle inc
Udit Sabharwal


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