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Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A)

Picture of Kulicke and Soffa Industries, Inc., in China: Transferring Knowledge (A)
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While much of the work on outsourcing to China focuses on the low cost and its tradeoffs, this case examines in depth the interaction between human capital and a firm's cost and capabilities. Suitable for the MBA, EMBA, GEMBA, and executive education programs, the case presents a manufacturer of semiconductor assembly equipment looking to achieve growth in its wire bonding tools segment?in particular, capillaries and dicing saw blades?through geographic expansion. At the time, it manufactured capillaries in Yokneam, Israel, and blades in Santa Clara, California. In the A case the team is charged with designing and opening a new facility in Suzhou, China. Expanding operations to China meant cost savings, and it was where K&S's market had expanded. But it wasn't clear whether it made sense to move the capillary process, the dicing blade manufacturing, or both. And if K&S did move to China, should it keep the Israeli- and American-based factories open as well? And once those decisions were made, what exactly would the knowledge transfer look like?
Case Number: OM-1410
Type: Case
Learning Objectives: 1. Identify factors influencing a global move of manufacturing processes across countries/cultures. 2. Analyze the economic/financial consequences of different off-shoring options. 3. Develop a framework for making decisions about moving manufacturing processes and human capital. 4. Understand the implementation challenges of off-shoring from a human resources and operations perspective.
Length: 11 pages.
Category: Leadership and Organizational Behavior
Manufacturing
Operations Analysis
Operations Planning
Operations Strategy
Outsourcing
Supply Chain Management
Published: 08/30/10
Revision Date: 03/28/13
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