Tag: Outsourcing

Vietnam’s outsourcing factory

I have heard about TMA Solutions new building in Quang Trung Software Park, but I have never got a chance to stop by, until yesterday.

1,200-strong, TMA begins to look like an army of engineers (my friend and guide showed me a beehive behind the building, after we had toured their lobby where Vietnam‘s historical artifacts were on display, next to the museum of telephony).

“It is to show the stream of history, culturally and technologically, so our engineers could get a sense of where things might be going” said my friend.

I could relate to that.

Users and programmers don’t exist in a vacuum.

We live and breathe the same air as everyone else.

Honda got hit not once but twice last year, both in Fukushima and in Thailand.

While incubators and laboratories are necessary for concentration and collaboration, they still function within a larger ecosystem.

Users tend to move on to the next big thing more quickly than companies.

Two great benefits TMA could offer to prospective clients:

– its time-tested know-how

– young work force who can stay on for however long the project requires (end-to-end outsourcing).

Yes, we had a sort of working lunch and then marketing presentation.

But it’s the spirit of the group, the speed of execution and the spread of product (cloud computing) that will work in TMA’s favor.

If they grew  (at least no lay-off)  in hard times, how much more in good times.

I am afraid this is counter-intuitive. But organizations need to secure talent just as much as they secure property and product.

When all boats rise, talent can then command higher salary leveraging supply vs demand.

As engineers huddle in conference rooms and cubicles,  consumers are shopping for the greatest and latest.

In turn, these technologies (cloud, social media apps) enable new applications (e.g. Google + Search) which in turn reshape consumer expectations.

It’s the loop, of empathy, of hits and misses (Betamax) and the drive for perfection (Apple).

Outsourcing is just a phenomenon, but man’s search for meaning and connection has been around much longer.

Get to the bottom of this, you will get to the bottom line.

I like my guide’s side comment “look at Napoleon! he was so short, yet so imperial”.

I just know from seeing the beehives behind the building that worker bees are busy at work, coding and collaborating, and  in the process saving tons of money for clients. Clients who now can sit back and choose from a score of outsourcing factories. Let the game begin. Stay hungry, stay curious (Jobs’ commencement address at Standford).  Vietnamese engineers at TMA can discount the first advice and focus on being curious. This, their shrewd leader had already anticipated. He wanted to leave his legacy via the museum of  ethnology (past), and technology  (future).

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.