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Getting Sourcing Right In China
Not long ago, Western and Japanese companies were interested in China primarily as a market for their goods. Now retailers and manufacturers are as eager to source their parts and products from China as to sell their own wares to its consumers. Negotiating the terrain, however, can be difficult as companies grapple with geographic distance and cultural differences. Ramping up a procurement organization requires patience, attention to detail, and a careful balance between supervision and delegated authority.
The take-away: Companies that have established successful sourcing operations in China have focused on a few fundamentals, such as the need to address organizational inertia at home and to build local capabilities abroad. First movers will gain cost advantages and operational capabilities that their competitors can't easily match.
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