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By S. Thornton, J. Marion

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Production equipment for core processes like circuit board assembly and material handling is highly generic, and can be moved between divisions. Warehouse space can also be re-assigned, as can personnel. Second, as a response to the strategies by lead firms to capture supplier capabilities, the largest ODM firms started, after the early 2000s, to discriminate against smaller customers by offering higher pricing, lower R&D and production quality, and slower delivery responsiveness. 9 Organization of Quanta Computer as of 2006 Note: Company names in parenthesis are main customers of business units.

IDS Bulletin 32(3): 9–18. Sturgeon, Timothy J. 2009. ” In Frontiers of Commodity Chain Research, ed. Jennifer Bair. Stanford: Stanford University Press: 110–135. Teece, David and Gary Pisano. 1994. ” Industrial and Corporate Change 3(3): 537–556. Teece, David, Gary Pisano, and Amy Shuen. 1997. ” Strategic Management Journal 18(7): 509–533. Yusuf, Shahid. 2004. ” In Global Production Networking and Technological Change in East Asia, ed. Shahid Yusuf, M. Anjum Altaf, and Kaoru Nabeshima. Washington, DC: The World Bank: 1–34.

Source: Annual company reports. 5. 1. Change in the dynamics of inter-firm relationships: shift to overlapped long-term partnerships In the early 2000s, an industry shakeout took place on the ODM side, and a small number of large Taiwanese suppliers came to dominate the notebook PC contract manufacturing business. This led to several new features in the inter-firm relationships described below. The main factors behind these changes were the following. First, the policy change by the Taiwanese government in 2001 to approve investment by Taiwanese notebook PC manufacturers in China spurred the shakeout in the industry because smaller firms did not have the resources to scale up production in China.

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