Supply Chain Strategies to Safeguard High-Tech Intellectual Property in Operations Outsourced to China

The surge of United States high-tech firms offshoring operations to China was driven by economic incentives of the early 1990s, low costs of labor, and ample access to an abundance of resources required in high-tech manufacturing. The dawn of the 21st century served as the advent of technological advancement and innovation in congruence with China’s rapid ascension as a prime high-tech manufacturing hub. However, increased allegations of foreign intellectual property (IP) infringement in outsourced research and development (R&D) and manufacturing on behalf of China’s state-owned enterprises (SOE) have evoked concern amongst international speculators, who allege China of weakened intellectual property enforcement and collusive tactics with state-owned enterprises in the cultivation of an anti-competitive marketplace. This thesis applies a trilateral approach to determine the optimal legal, supply chain management, and business strategies to safeguard the intellectual property of high-tech firms with outsourced operations in China.<br/><br/>Firstly, this thesis explores China’s rapid acceleration of manufacturing capabilities in tandem with nationalist initiatives, historical background, and subsequent influence cultural notions; aspirations in attaining global dominance as a high-tech innovator via nationalist programs and incentives. Succeeding is a comparative analysis of intellectual property between the United States and China, associations between intellectual property protection and economic development, and global intellectual property agreeance as set forth by the World Trade Organization (WTO). Following is a legal analysis of China, which assesses legislation, judicial structure, and litigation. Lastly, is an assessment of supply chain management in China, which assesses high-tech outsourcing practices, the vulnerability of intellectual property in research and development, instances of patent infringement, unfair licensing practices, and trade secret misappropriation.