Nearshoring Fast Becoming a Real Solution to Supply Chain Disruption, National Technology Leadership

September 23, 2021

There’s been a lot of talk recently about regulations that would forbid government-supported technology developed in the U.S. to be sent to manufacturers overseas. This idea sparked a renewed conversation about the benefits of nearshoring in general, and I wrote about it recently in a Forbes Tech Council blog post.

In addition to bolstering the nation’s manufacturing prowess, bringing the full Lifecyle of product development on-shore could minimize some of the supply chain disruption that we’ve seen lately. Other benefits of nearshoring that I highlighted in the Forbes article include:

  • Increasing security. Cyberattacks seem to be on the rise. Regardless of whether the breach is caused by malware, ransomware or other hacks, the result is the same – havoc across the very systems that run our businesses. Perhaps we would have greater control if we manage all aspects of product development.
  • Supporting U.S. competitiveness. The U.S. is typically ranked in the top percentile of technology leadership in the world, and contains a wealth of invaluable intellectual property. Keeping development of advanced AI and other technology solutions within the U.S. helps to safeguard this important asset. 
  • Mitigating risk. Given the vulnerabilities of the supply chain that were exposed during the pandemic, keeping development and manufacturing closer to home enables organizations and federal agencies to better manage and mitigate the risk of future disasters or other unforeseen circumstances. 
  • Ensuring diversity. Studies have shown that diverse teams perform at a higher level, and software development teams are no exception. When bringing software development and services back to the U.S., companies can better control how diverse their teams are – which has proven critical to quality AI, among other things.

One issue that continues to be raised is that, while nearshoring can be beneficial, the cost will always be cheaper off-shore. Yet, because U.S.-based nearshorers, such as Puerto Rico-based Wovenware or companies in the U.S. Virgin Islands, are U.S. citizens, they offer the same security and intellectual property protection, and share a common language, work ethic and business standards as mainland firms, but at much lower prices.

In order to maintain leadership in technology innovation and ensure greater security, diversity, quality and less risk, nearshoring is increasingly becoming a viable option. With or without growing regulations, it simply makes better sense.