Alf introduced me to the Smiling Curve a few years ago... It is an illustration of value-adding potentials of different components of the value chain in an IT-related manufacturing industry. The concept was first proposed by Stan Shih, the founder of Acer, an IT company headquartered in Taiwan, around 1992. According to Shih’s observation, in the personal computer industry, both ends of the value chain command higher values added to the product than the middle part of the value chain.
The concept of value-added is very important.
Here's a good article from 2004 about China in transition.
For Whom Does the Smiling Curve Smile?
And lastly, check out some of the slides from this PDF about business growth strategies for Asia Pacific, specifically those starting on page 8.
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