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by nucleardog
1753 days ago
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As long as there's a chance to eek out some more money, companies will continue to do it. This isn't remotely a new thing. There's a pretty reasonable chance part of the downfall of Nortel was a lot of their data being extracted by the government and provided to Huawei. After Nortel shut down, the Canadian Department of National Defense picked up their headquarters to move into, but the move was delayed for years because the building was chock full of listening devices. This started almost 20 years ago. But here we are still willing to gamble that they'll respect our IP because maybe we can make a few bucks. |
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What I observe is the motivation isn't to "make a few bucks", it is "give the perception that a few bucks will be made". It looks like the agency problem: move to China, convincingly explain to the board and shareholders that such a move was bold, strategically sound, daring, fiscally prudent, and courageous. Gather stacks. Show a few years of expense sheet fluffing, meanwhile cutting everything else that isn't measured. Exit stage left. By the time the chickens come home to roost, IBGYBG.
What I find curious is I don't really see Japanese corporations doing this, even though they also do a tremendous amount of business in China. I hazard a guess at an overall business leadership culture difference between Japan and America; America's is more value extractive-oriented ("unlocking" value), while Japan's is more value constructive-oriented (looking for compounding small, incremental improvements to deliver value).