Conclusion: Are You Ready to Compete Flat Out?

In March 2007, the news broke that ITT Corp. had agreed to pay a fine to the U.S. government of up to $100 million for exporting classified technology for night-vision goggle component parts to China, Singapore, and Britain in 2001. The sensitive night-vision technology was critical to the success of U.S. forces in Iraq and other battlefields, allowing U.S. troops to “own the night.” The breach was considered one that could put soldiers on the battlefield at risk.

Outsourcing was at the heart of the case. ITT’s Night Vision unit arranged to have various components of its goggles made by contract manufacturers in Asia. Managers were looking for a lower-cost manufacturer of the goggle’s light interference ...

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