Prevent Disasters in Design Outsourcing
by Jason Amaral and Geoffrey Parker
Firms that pursue product platform strategies—by leveraging a common set of development, production, and support resources—have been able to outmaneuver competitors by cost-effectively delivering a greater variety of distinctive products. Having succeeded in outsourcing manufacturing, these firms are now also working to outsource the design of new platform-based products.
Unfortunately, design outsourcing often fails to generate desired cost savings and can even tear profitable platforms apart. Of the nearly 100 outsourced design projects we have studied at Fortune 1,000 companies, approximately one-third worked seamlessly, owing to modular designs, effective management, or both. The other two-thirds struggled or failed, for three main reasons:
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Source: Harvard Business Review