ABSTRACT: Medium to large medical device companies often strive to become vertically integrated: they might own their own silicon fab, design their own hardware, engineer proprietary protocols, build their own testing and deployment equipment from scratch, and design their own custom manufacturing processes.
Although there are good reasons for companies in regulated markets to become more vertically integrated (control over diverse processes, control of quality, and control of the supply chain), it can often cause a technology drift effect over time between the company's core competencies and industry trends.
This article discusses how outsourcing can be used strategically in key circumstances to gain valuable access to otherwise unavailable and diverse solutions from non-medical industries for medical device manufacturers thereby minimizing the technology drift effect.
Mark Benson is Vice President of Engineering at SmartThings, a technology company based in Mountain View, CA and a wholly owned subsidiary of Samsung Electronics. Mark is a regular speaker and writer on the intersection of technology, business, and society as it relates to product development, technology leadership, strategic planning and execution, intellectual property portfolio management, software architecture, information security, competitive positioning, and organizational behavior.