What happens when a manufacturer design (ODM) company is trying to become a branded seller of goods? The case traces the evolution of ASUSTeK motherboard provider, ODM desktops and laptops, through its division into three companies, which are separately branded business conduct, ODM, and contract manufacturing. Chairman Jonney Shih must not only meet the challenges of the brand, but it must also build new organizational capabilities ASUSTeK, while Pegatron is trying to succeed in business from past clients ASUSTeK, and now competitors. The case provides an opportunity to apply the lens of disruptive innovation to discuss outsourcing, considering the implications for companies like HP and Dell, which have outsourced much of their product design computer ODM companies as ASUSTeK, only to watch them turn into competitors. Students can also study how the organizational resources, processes and values can create or limit its ability to move into new areas.
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by Willy Shih, Howard Yu, Hung-Chang Chu Source: Harvard Business School 19 pages. Publication Date: January 27, 2010. Prod. #: 610041-PDF-ENG
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