In The News

Li & Fung Warns of End of Cheap China Goods

Rahul Jacob March 28, 2011
The era of low prices – thanks to low-cost labor in China – is over, warns Li & Fung, a Hong Kong product sourcing firm, as reported by the Financial Times. China laborers overall enjoyed a raise of about 20 percent this year, reports Rahul Jacob. Retailers must now decide how much of the extra costs they can pass on to consumers and how much can be taken away from profits. Even as...

A Wing and a Prayer: Outsourcing at Boeing

Kyle Peterson March 11, 2011
In making its new 787 Dreamliner, Boeing outsourced work to a global network of more than 50 partners, a marked contrast to the traditional practice of manufacturing planes at its base near Seattle, Washington. The plane is nearly three years behind schedule, beset by technical and supply problems and billions of dollars in cost over-runs. Boeing workers complain that the failures derive in part...

Where Are the Jobs? For Many Companies, Overseas

Pallavi Gogoi January 4, 2011
The large and growing emerging markets of China, India and Brazil are a lure for multinational corporations in search of top revenue and profits. Job creation follows the markets, strengthening the middle class and education programs in emerging markets, particularly Asia. Companies like Caterpillar, Coca-Cola and DuPont hired more employees overseas in 2010 than in their home base of the US,...

Dream Postponed

Nayan Chanda January 3, 2011
In design and manufacture, aircraft are among the most complex of products. Outsourcing of specialized features can provide efficiencies, but Boeing may have gone too far with the Dreamliner. About 70 percent of Boeing’s aircraft relies on outsourced components, reports Nayan Chanda, YaleGlobal editor, in his regular column for Businessworld, and the aircraft is two years behind schedule. One...

Qualms Arise Over Outsourcing Of Electronic Medical Records

Amol Sharma, Ben Worthen November 8, 2010
Digitizing health records improves care, reduces errors and saves money in redundant testing or treatment. In an effort to reduce costs, the US health care reform law includes incentives, with billions in government funding, for providers and hospitals to rely on electronic medical records. Only 20 percent of US hospitals now rely on electronic records. Analysts anticipate that hospitals will not...

Global “Chop Shops”: Slice, Dice and Outsource

Farok J. Contractor October 27, 2010
Manufacturing and IT firms slice their work into parts, much like the chop shops that collect old cars, breaking them down into parts for resale and higher profits. Mangers divide tasks, sending work to points of the globe where costs and skills are most efficient for each task at hand. Farok J. Contractor, professor of management and global business, analyzes trends underway in the once-...

India-Ohio Outsourcing Ban

Rupa Chanda October 8, 2010
As US job creation remains stymied, governments at all levels enact protectionist measures. For example, the US has hiked fees for H1B visas for foreign professional workers, and with an unemployment rate exceeding 10 percent, the state of Ohio has banned outsourcing of IT or back-office work in government-funded projects, reports the East Asia Forum. Firms in India that bristle about such...