Riassunto analitico
Globalization has transformed the value chain: the sequence of activities that a company performs to design, produce, sell, deliver and supports its products.
Many businesses, from small start-ups to large companies, choose to outsource processes as new and innovative services are being offered in an ever-changing, highly competitive business climate.
Two areas in which companies adopt business process outsourcing are back office and front office. People who work in the back office are typically tasked with internal business functions, such as logistics, collections and receivables or procurement.
This study will focus on the back-office outsourcing, which refers to contracting a company’s core business operations, such as manufacturing, research and development, accounting, quality assurance, etc. The main advantage that outsourcing offers to a company is flexibility.
In fact, by outsourcing several functions, a company can better allocate resources and time to create its competitive advantage, through customer relations, product leadership or operational excellence.
Four different approaches to internationalization will be taken under exam, based on the make-or-buy matrix that will be compared with the statistical data and applied to the toys industry in China.
The toys industry is highly competitive and dynamic, later in this paper will be analysed the effects of growing rate on the industry, as well as the five forces analysis by Michael Porter.
In order to support the thesis, four case studies will be presented. Mattel, Hasbro and Lego represent three world leaders with different international approaches that recall the make-or-buy matrix.
On the other hand, ODS is a small-medium enterprise that operates in the Italian market and offshore outsources manufacturing operations in China. Based on my personal experience in this company and in the Chinese toys industry. I will describe the product development process with practical examples and evidences.
The last part of the paper will focus on Chinese toys industry and which factors are bringing international firms to outsource in the country more than 70% of total goods. Indeed, in the last years, China became a global innovator, creating a new strategic advantage for outsourcers.
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