"Innovation Shift" to the Emerging Economies: Cases From IT and Heavy Industries

Research Report

"Innovation Shift" to the Emerging Economies: Cases From IT and Heavy Industries

October 12, 2007

Abstract

Current shifts of technology development work by multinationals to the emerging economies is now high-end (rather than adaptive) development. Our study of processes and outcomes of globally distributed engineering involves field work at 67 sites in eight countries. Based on our fieldwork we conclude that this new shift in the location of technology work at the top of the value chain is not only distinctive, but also disjunctive, not following past trajectories of offshoring. This is occurring as a matter of incremental value chain creep, rather than guided by "strategy." The consequences are not well conceptualized by managers and policymakers.

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