Large companies have long recognized the necessity of outsourcing certain processes to reduce their costs. Improvements in global communications and transportation have made offshoring an extremely viable alternative. Great productivity increases are inevitable for moving certain functions to low-cost suppliers.
An economic revolution is rapidly moving China towards a fully market driven economy. The effects of these government policy changes have been astounding, and reverberate throughout the world. Today, low-cost production demand is transforming China into a major workshop for the world.
Thousands of privately-owned factories have sprouted up, especially around Shanghai and Shenzhen, to meet the tremendous demand for low-cost production. Many are equipped with state-of-the-art production equipment, world-class engineering talent and a workforce that is motivated, energetic and committed. Millions of Chinese stream in from the countryside seeking the relatively high wages of the industrialized cities so managers have the freedom to recruit high-quality production teams for a fraction of the costs that would be incurred in Europe or North America.