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Unlike software services, where companies such as TCS, Infosys have much longer runways before they are disrupted (because customers still depend on low cost outsourcing), products are a different ball game.
But watch out: There could be some hefty fees involved in outsourcing products.
Peter Ham (of Merrill's private-client services unit) says that Merrill charges an extra 20 to 25 basis points on top of any base fee for outsourcing products.
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Grid computing is the logical next step on the road of the IT market to ubiquitous connectivity, virtualization, service outsourcing, product commoditization, and globalization.
If corporations are going to offshore and outsource products, components and ingredients, then it is back to basics.
Companies thus often outsource product design and development to engineering houses filled with Chinese engineers trained overseas.
Plexus, based in Neenah, Wisc., outsources product development and design for networking, industrial and government companies.
When startups ask me whether they should outsource product development, I usually advise against it.
"We've never thought about outsourcing our products, because our customers don't want a Meridian speaker made in China," Mr. Stuart said.
Small- and medium-sized enterprises (SMEs) in job-shop machining are experiencing more shop-floor uncertainties today than ever before, due to multi-tier outsourcing, customised product demands and shortened product lifecycle.
According to Professor Saleem Ali, director of the Centre for Social Responsibility in Mining, that makes it "very difficult to track and trace [rare earth elements] from the mine to the product, because a lot of electronics manufacturers are outsourcing their product manufacturing and operations to Chinese companies, which get that material from somewhere within China".
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