Offshoring is commonly viewed as a way to ease pain—specifically, the high cost of operating in the West. But increasingly, companies also see it as a path to gain. An ongoing study finds that 73% of offshore arrangements support companies’ growth strategies, with 32% of those initiatives involving product innovation and design, R&D, or engineering. Companies are pursuing those activities more than any others except such usual suspects as administrative functions, IT, and contact centers. (See the exhibit “Reasons for an Offshoring Strategy.”)
A version of this article appeared in the March 2006 issue of Harvard Business Review.
