This page contains a Flash digital edition of a book.
NEWS // FEATURES // NEW PRODUCTS Outsourcing: The Innovation Killer

Emad Isaac, Chief Technology Offi cer, The Morey Corporation

the U.S. economy today are blamed in large part on outsourcing; the term ‘exporting jobs overseas’ is commonly heard, and its meaning debated. But when we outsource the manufacturing of any product out of the country, are we merely outsourcing its manufacture, or is there more to it than that? Outsourcing may be compared to an iceberg. I suggest that when we outsource, we’re looking at the part of the iceberg visible above the sea; the larger and more dangerous part of it is below the surface, out of sight. The old adage that ‘Necessity is the mother of


invention” has always been true, as hackneyed a cliché as it may seem. Invention comes from the need to solve a problem, to create a solution to a need. Just as Edison’s electric lamp grew out of the need for more reliable, long-lasting, and less dangerous lighting sources than were available at the time, so is every successful invention a solution to a problem that needed solving. Few industrial products ever invented and subsequently manufactured have never evolved, or improved. Every product from automobiles to electric fans has evolved into a better, safer, and more reliable product, and the art of improving a product is commonly termed innovation. It differs from invention, whereby a product – a solution to a need – is created for the fi rst time, a something that has never existed before. Innovation is the art and science of improving upon that invention, using what you have to create something newer from a product that has already been invented. When we outsource the manufacturing of

many different products and industries to overseas manufacturers, we do a number of different things that are not necessarily helpful, and indeed may

32 EIU

utsourcing the manufacture of a product has its pros and cons, and of late, more arguments against it. Many of the troubles besetting

be harmful. The fi rst thing we do is eliminate the need to invent. We often outsource not merely the manufacture of products, but the development of new ones as well. This unwillingly or unknowingly outsources the problem, and it becomes someone else’s responsibility (and potential for profi t) to fi nd that solution that we would have otherwise been solving. And, with the responsibility to develop and manufacture also comes the responsibility or natural course to innovate and improve both the methods of manufacturing as well as the product. Once the problem is no longer in front of you, it

becomes someone else’s responsibility; it’s as simple as that. Thus, we outsource more than we realize; we outsource ideas, creativity, the ability to solve problems, and more importantly we potentially minimize the ability to create new products and open new markets. All of the creative development and innovation

that attends the lifetime and evolution of a product now shifts over into the lap of the contract manufacturer. As they see the problems, they become the ones who have to come up with creative solutions, ideas, and different ways to make the product better. That’s because when you work with a problem over and over, you start to see its shortcomings; you start discovering ways to make it better, and you begin to see how it competes in the marketplace. So when we outsource, what matters most are not the tangible things that we are transferring to someone else’s jurisdiction, but rather the more important intangible things. Think of creativity as a movable object; we can lose it by transferring it or moving it into a situation where somebody else begins taking over. At some point there is a crossover in responsibility, where we become no longer the driving participant in developing a solution, but rather the ‘check’ hat that pays for and buys things. As an example, let us say that I am defi ning

a product. This product has many separate technologies involved in its engineering and / September 2011

Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48