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Literature Review on Outsourcing in Electronics Industry in China
Word count: 2,000
1.0 introduction
Outsourcing referred to vertical specialization. It is simply the farming out of a business function to a third party and it covers a contractual agreement on exchange of services and payments. Several researches have acknowledged significance of outsourcing. Calaf foresees an increasing trend of companies’ outsourcing their productions to others who are expertise in product manufacturing (Mason and Cole, 2003). Apart from his concern, outsourcing also draws attention from researchers like Scott J. Mason, Dieter Ernst, Masaaki Kotabe and so on. What to mention is that these researches pay their special attention on process of outsourcing, or some new technique development applied in outsourcing. However there is a lack of study the evolution process of Outsourcing in special Industry to identify some intrinsic laws during the evolution.
The purpose of this essay is to choose Electronics Industry as a typical example to fill this gap to study the development process of Outsourcing in Electronics Industry make a literature review about China’s current outsourcing, historical development of outsourcing and effects of outsourcing,and to identify some intrinsic laws during the evolution
2.0 Evaluation of Outsourcing in Electronics Industry
2.1 Evolution of Global Outsourcing
Over time, there are three eras through the history of electronics manufacturing: vacuum tube era transistor era and integrated circuit era. They have witnessed how outsourcing emerged and evolved. Mason’s study shows that approximately 10 years ago no more than 5 percentage of all manufacturing was outsourced. However, global components’ sourcing was seen as a significant trend among manufacturing companies (Quinn, 1999; Kotabe, 2002; Mol, et al., 2005). While there began a surge in manufacturing outsourcing on large scale in the mid-1990s. Then, over time, changes had taken place with the developm
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