During the last decade, advances in high-technology industries have accelerated. The price performance ratios continue to follow the industry idioms of more performance for lower price. Intel’s Gordon are first proposed the law that bears his name in the late 1960s: chip complexity (as defined by the number of active elements on a single semiconductor chip) will double about every device generation, usually taken as about 18 calendar months. This law has now been valid for more than three decades，and it appears likely to be valid for several more device generations. The capacity of today’s hard drives is doubling every nine months; and the average price per megabit have declined from $11.54 in 1988 to an estimated $0.02 in 1999.
Similar improvement has been occurring in the field of communication, both in the speed and the availability of the Internet. It is estimated that global access to the Internet has increased from 171 million people in March 1999 to 304 million in March 2000, an increase of 78%.
At the same time, the requirements for developing new products in high-technology industries have followed these improvements, with faster product development and shorter product life cycles. Many of the leading technology companies have created a ^virtual enterprise," aligning themselves with design and manufacturing outsourcing partners to carry out services that can be performed more efficiently outside the boundaries of the organization. These partnerships enable a company to focus on its core competencies^ its own product brand, its customers, and its particular competency in design or manufacturing.
These newly formed outsourcing companies are providing for cost- effective and timely services. In manufacturing, they provide multidisciplinary manufacturing, testing, and support services, including PCB assembly and testing packaging technology such as sheet metal and plastic injection molding, and software configuration and support services such as repair depot and warranty exchanges. They also offer lower cost, higher flexibility, and excellent quality eliminating the need to spend money on capital equipment for internal capacity. This new outsourcing model allows all links in the supply chain to focus on their own core competencies while still reducing overall cycle times.
In design outsourcing, the supply chain offers the flexibility of sing]e or multiple competencies, including specialized engineering analysis and design validation^ testing, and conformance to design standards for multiple countries or codes. In addition, suppliers can offer their own supply chain of strategic alliances in tooling and manufacturing services worldwide. Most of these outsourcing companies offer design feedback in terms of design for manufacture (DFM) through early supplier involvement (ESI). These design service providers have reduced the need for high-technology companies to purchase or maintain expensive engineering and design competencies, some of which are used infrequently in project design cycles.