Transforming ASUSTeK: Breaking from the Past

Posted: 19 Apr 2012

See all articles by Howard H. Yu

Howard H. Yu

IMD International

Hung-Chang Chiu

National Tsing Hua University

Date Written: March 25, 2010


What happens when an original design manufacturer (ODM) firm tries to transform itself into a branded goods seller? The case traces the evolution of ASUSTeK from a motherboard supplier, to an ODM of desktop and notebook PCs, through its split into three companies that separately pursue the branded business, ODM, and contract manufacturing. Chairman Jonney Shih has to not only confront the challenges of brand building, but he must also build new organizational capabilities in ASUSTeK, while Pegatron struggles to win business from ASUSTeK's former customers and now competitors. The case offers an opportunity to apply the lens of disruptive innovations to a discussion of outsourcing, examining the consequences for firms like HP and Dell that have outsourced most of their computer product design to ODM firms like ASUSTeK, only to watch them morph into competitors. Students can also examine how organizational resources, processes, and values can shape or limit its ability to move into new areas.

Learning Objective: To examine the evolution of a contract manufacturer as it grows its capabilities and tries to transform itself into a branded good company.

Suggested Citation

Yu, Howard H. and Chiu, Hung-Chang, Transforming ASUSTeK: Breaking from the Past (March 25, 2010). Harvard Business School Technology & Operations Mgt. Unit Case No. 610-041, Available at SSRN:

Howard H. Yu (Contact Author)

IMD International ( email )

Ch. de Bellerive 23
P.O. Box 915
CH-1001 Lausanne


Hung-Chang Chiu

National Tsing Hua University ( email )

No. 101, Section 2, Guangfu Road, East District
Hsin Chu 3, 300

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