1.1.1. Bengtsson (2008): Outsourcing manufacturing
The outsourcing manufacturing has no positive effect on operating performance of the company. It would rather reduce innovative capabilities. On the contrary, investments in technology and organization capabilities can significantly improve the performance of company. The author suggests finding an optimum combination of outsourcing and investments to improve overall performance. (Bengtsson, 2008)
1.1.2. Broedner, Kinkel and Lay (2009): Productivity effect of Outsourcing
It is suggested in the article that many outsourced projects proved to be detrimental for the business. The cost comparisons are not enough to make outsourcing decisions as qualitative factors should also be considered. Additionally, the transaction costs are neglected mostly due to the difficulty in estimated these costs. It was suggested that an integrated system with competence development for innovation can be better option (Broedner et al., 2009).
1.1.3. Pisano and Shih (2009): Restoring American Competitiveness
It also indicates that outsourcing is destructive for a business, which reduces investment in R&D. The organization should rebuild and integrate process to restore high-tech sector based in the US. The loss of resources over the years has resulted in limitations for the organizations to manufacture in US.
The organization can improve performance with home based manufacturing with research, collaboration and Tech savvy board of directors (Pisano & Shih, 2009).
1.1.4. Platts and Song (2010): Overseas Sourcing Decisions
The study suggested that the total cost of sourcing to China is averagely 50% higher as compared to quoted costs, due to the hidden or add-on costs. This results in underestimation of costs. Organizations should conduct a thorough cost analysis for outsourcing before making the decision (Plats & Song, 2010).
1.1.5. Kinkel (2012): Trends in production relocation
It suggests relocation to home base with Asia being attractive for far-shore manufacturing. The organization should conduct sensitivity analysis on the scenario and make decisions based on it (Kinkel, 2012).
The message from insight in articles is to give preference to on-shore (home based) production with investments to improve efficiencies if required. Outsourcing is suggested to have many negative effects on the organization and should be avoided. The manufacturing off-shore in Asia can be viable but needs a thorough study and analysis. It should also focus on integrating these off-shore manufacturing processes throughout the organization………….
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