The outsourcing application in developing one's own brand: transformation from ODM business Online publication date: Mon, 12-Nov-2007
by Yu-Xiang Yen, Der-Juinn Horng
International Journal of Technology Marketing (IJTMKT), Vol. 2, No. 4, 2007
Abstract: With the declining profitability of manufacturing activities, building their own brand is an aggressive way for Original Design Manufacturing (ODM) firms to sustain their profit growth. However, outsourcing is vital to the success of brand development and the issue of applying outsourcing to the transformation of one's own brand is neglected. Based on the Resourced-Based View (RBV) and core competence theory, this paper makes four propositions aiming to bridge the gap between outsourcing application and transformation to brand building. Subsequently, case studies are conducted to examine three Notebook (NB) PC firms. The results show that firms shifting to a different business type could adjust their organisational structure and relocate resources to strengthen their core competences through outsourcing non-core activities. Therefore firms transforming to their own brands could achieve higher brand value. The paper also proposes an outsourcing application model and some recommendations for ODM firms to develop their own brands.
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