supply chain dilemma

First they outsourced to lower the cost of, let’s say, an I phone.

The guy (Chinese farm-to-factory worker) if not jumped out of the window from a Foxconn‘s dorm, wished he had because there was no way he could afford one. Even his counterparts in NYC had to get in line just to hand carry the same phone back to China for a profit.

Meanwhile, leaders are scratching their heads, trying to turn that same worker into a domestic consumer. So, he needs and wants a raise. Wage increases drive up production costs, making it less affordable for emerging domestic market.

Or, because of the innovator’s dilemma, product cycle, market adoption and planned obsolescence, consumers taste moves on to Galaxy etc…just as you adjusted your production strategy (Dell just-in-time, then went Retail, then went private).

It’s hard for young people in China and Vietnam not to want an I Phone. It’s harder to keep their wages down while aspiration is up. Meanwhile, the US needs jobs here at home. The same with European countries which can offer quality workmanship (even though for years, they haven’t had a decent manufacturing order to practice their skills ).

For IT outsourcing and cloud computing, it’s easy to “follow the sun”. But for manufacturing it is hard to pick up and move, then move back. Two trends seem to recently emerge in the US: resource-sharing (ride and facility), and reshoring.

A few workers jumped out of the window in China signals the beginning of many  to follow elsewhere.  Remember we live in an interconnected interdependent world where one-upmanship now spans the globe (Indian IT workers are seen partying just like counterparts in Silicon Valley during Happy Hour).

One CEO is nominated CEO of the Year (Netflix), two CEO’s going bankrupt (Blockbuster and MGM).

I got a Sixth Sense. I see dead people. The time, they are a’ changin.  The guy who hummed it (Bob Dylan) was featured in a WSJ article as slipping due to aging.

We got enough worries about the ever expanded and contracted cycles of long-tail product but short-term people.

Ford was quite correct to make the model T’s affordable to his workers (whose wages were quit high). That seemed to put the dilemma to rest in his time. Times, they are a changin, since Model T to I phone. Quite a gulf to cross from creators to consumers.