Interesting Trends in Off shoring

Trends in off shoring continue to evolve. Key interesting trends include off shoring of innovation and off shoring of primary research. I believe at this point the traditional arguments of division of labor between lower cost and higher cost labor is starting to disappear and what is emerging is a change in business model - serving the global customer.

Trend that started with reducing costs for manufacturing to China then ninties led to offshoring of software development and support to India. However offshoring destinations are growing to be fully developed markets themselves which brings the true value of the globalization - ability to sell our products to customers abroad.

As the GNPs of India and china conitnue to rise and spending power of their consumers continue to increase, attention to business opportunities in expanding businesses in established industries (food, computing, pharma and air planes) need focused energy from american companies.

Thomas Friedman's book may be about flattening of the world, but we need to remember that in a flat world money can flow in both directions. Now that there is more money to go around, question is going to be who is going jump and take the lead.