As PC Industry Leads, Will Others Follow with Offshore Operations?

Ann All

Is the PC industry an early indicator of where innovation is headed? If so, it appears to be moving offshore.

 

Like most other North American companies, PC manufacturers were quick to offhsore manufacturing, while keeping functions like R&D, project management and marketing close to home. (So many have done so that some economists warn reliance on offshore production is skewing U.S. productivity statistics.)

 

But that's beginning to change, reports internetnews.com. As the number of PC buyers grows in emerging markets, especially Asia, companies will likely move more high-level operations to those areas, concludes a report from the Personal Computing Center at UC Irvine.

 

The executive who heads Dell's Asia-Pac division says in a ZDNet India report that the company predicts year-on-year growth of at least 50 percent for the forseeable future. Though there is no mention of R&D, Dell is spending $30 million to build its first manufacturing facility in Chennai.

 

The offshoring of non-manufacturing functions won't happen in the near term, says the report, noting that Asian firms still lack industrial design expertise, as well as skills in marketing and other business areas.


 

For the near future, the report predicts that high-level R&D, concept design and product development will remain in the U.S, and Japan, while applied R&D and development of new platforms will occur in Taiwan and production will take place in China.



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