Going, going, gone [outsourcing R&D]

This paper discusses the recent trend among high-tech consumer electronics device OEMs toward outsourcing not just commodity manufacturing but R&D and innovation activities as well. The key drivers behind this trend are the competitive advantage gained through improved time to market and time to volume, the superior product differentiation and reduced product development costs and risks. This trend, however, has raised questions about whether technology should be developed through in-house R&D, collaboratively with partners, or purchased. While outsourcing of R&D function is a valid strategy for certain sectors and certain companies, it is important not to underestimate the complexity of moving the function and retaining business continuity.