Outsourcing, Offshoring, and the Stanford Good Products Bad Products class

The Jan 19^th-25^th edition of The Economist focuses on outsourcing and offshoring in its special report, as well as in a short article here.  I will talk more about this in a future post, but as wages in countries such as China and India rise, the advantages of operating overseas become more due to operating in countries that provide customers and that have good supply chains and sources of labor, than to low labor costs.  U.S. companies will therefore not leave such countries as India and China, and they in turn will  operate more in the U.S.  Foxconn is on the way and Cemex has been here for quite a while. 

 The ME 314 course at Stanford has now settled down.  Students at Stanford are allowed to “shop” for courses at the first of every quarter, which means that they can sit in on several for a few meetings before committing to their choices.  This makes for more satisfied and motivated students as well as a bit of extra learning.  The downside is to the professors, who are not quite sure who is in the class for a week or two.

 The class has met three times since the introductory session, with four guest speakers, assigned readings, and assignments for the future.  The first speaker was Stephanie Phillips, who I mentioned in my post of January 15th.  Dave Beach is a believer in the use of video not only for communication, but also for analyzing products, and one of the assignments the students have is to do a bit of field research using video.  The speakers following Stephanie were Scott Doorley and Jonathan Edelman, both with experience in doing such things.

 The fourth speaker was Peter Dreissigacker, who founded a company called Concept 2 with his brother Richard.  Peter was a student of mine in my early teaching days, and remains one of my favorite people.  They both received M.S. degrees in engineering at Stanford in the 1970’s, Peter in Product Design, and Dick in Industrial Engineering.  They were/are both outstanding rowers. Dick rowed in the Olympics, and Peter in the try-outs.  In 1976 they founded Concept 2  in Maine to make competition oars out of composite materials.  They later added a rowing ergometer, and still later a skiing ergometer.

Concept 2 is dedicated to having its products be the best in their class, and have generally succeeded.  Their oars are widely used in top competitions, and their ergometers are top of the line.  A look at the Concept 2 company website gives an indication of some of the things in which they are involved in their quest to not only make extremely high products, but spread  rowing more widely as not only an exciting sport, but also as wonderful exercise. As an example, the photo shows one of the indoor rowing competitions using their ergometers that the company has been sponsoring for 30 years.

Concept 2 is a relatively small company/family with long-term employees.  It is a happy place that is proud of its work.  Needless to say, the employees are unusually healthy, since Dick and Peter set the tone by remaining highly ranked in their age group in the international internet competitions based on concept 2 ergometers.

 This is a  company whose income depends on product quality.  And through their activities, such as the indoor competitions,they have gone far beyond their primary customers (high-level rowers) to expand their community of users.  Even I had one of their  ergometers in my house for many years, and it still is doing yeoman service with my kids and grandchildren.  And I daresay, none of us are being sought after by competition crews.  In fact, i have proven conclusively that I cannot even balance a single scull.