My father, when sizing up global matters over a martini or two, used to say “the pendulum always swings back.”
I think of that when we discuss the nature of outsourcing and offshoring today. For years, the pendulum swung to the side of the argument that embraced key benefits:
- Labor-cost reduction
- Proximity to emerging markets
- Occasional tax or currency benefits
Now, the pendulum swings back the other way, at least partly. Bolaji Ojo pointed this out several weeks back when describing the insights he got from the famous McKinsey report. (See: Why Manufacturing Matters & Where Best to Do It.) He wrote:
Until I read the McKinsey report, I had been wondering if I wasn't mistaken in disagreeing with the massive, decades-long transfer — or outsourcing, if you prefer — of Western production activities to the Far East and Easter Europe.
Another data point
Then there was Gary Pisano’s articulation nearly four years ago, in which he argued that the further away manufacturing is from R&D, the more difficult it is to stay competitive. That's because designers can learn best from peeking over the shoulders of their manufacturing counterparts to see what's working and what isn't on the line.
Where's the pendulum today? Avnet Velocity vice president and EBN community member Wade McDaniel is going to give us a clear sense for that Tuesday morning (February 19, 8:00 a.m. PT). That's when he'll present his view of the state of outsourcing during a 60-minute webinar that I'll host.
McDaniel, a 25-year supply chain veteran, has an excellent perch from which to offer his assessment. I hope you join us Tuesday. Here's a link to the webinar information.
In the meantime, what's your take? Where is the pendulum on the outsourcing offshoring clock?