Engineering Services Outsourcing www.segula.ro

What are engineering services?

 

Engineering services are those service functions that deal with or related to core engineering processes.

 

Examples are:

 

• CAD / CAM (computer aided manufacturing / design)
• Auto design
• Failure analysis of structural steel

 

The distinction that needs to be drawn here is between engineering functions and engineering service functions. An engineering function could be auto engine manufacturing. A related engineering service function would be designing the engine. It is similar to the distinction between manufacturing and manufacturing support services.

 

 

What is engineering work?

 

Engineering work is unique in the sense that it is generally not considered a commodity; rather it is considered a value-added service. It is not something that can be automated as there are always different factors and emerging technologies. The engineer is in contact with the client at all steps. The user may also be brought in the process. This is an iterative process. Constant reevaluation of the process and the progress is required. This leads to modifications. Upon completion, the engineer may be involved in the operation, the sales, or may teach the use of the product.

 

• I. Idea Phase - Identification of a problem or an idea (new building, product…)
• II. Design Phase - The engineer analyzes the idea or problem. Designs solution under guiding factors listed below.
• III. Test Phase - The engineer applies the design to a model to test. This would occur more frequently with products as opposed to construction.
• IV. Manufacturing or Construction Phase - The engineer supervises the manufacturing processes (for electrical and mechanical engineers), construction (mainly for civil engineers), or improvements made to a plant, operating system. Modifications made during this process.
• V. Product Completion or Production—Engineer or manufacturer may simply hand product over to the client (i.e. electrical device), may sell the product (i.e. scientific instrument), may actually operate the product (power plant), or may teach the operation to the user (i.e. office building).

 

Standards play a large role in engineering work as much of engineering results in the design of products. Standards serve to facilitate the reproduction and ensure compatibility between products. This could be in the form of standard software formats to guidelines for fitting screws or pipes.

 

IT is linked to the entire value chain but engineering sits at the heart of it

Some companies such as Toyota are built around engineering

% of respondents considering their function as core / strategic (BAH survey):
Engg - 95%
Finance - 80%
S&M 70%
Mfg - 60%
IT - 30%

Why should engineering services be outsourced?

 

For pretty much the same reasons why many other services - such as traditional business processes such as accounting and software development - are outsourced. (1) Cost, and (2) Ability to get better quality, through a vendor qualified in and focused on a specific engineering service domain.

 

While cost was perhaps the most important aspect in business process outsourcing, in the case of engineering services outsourcing, the ability to get better quality from a domain focussed vendor is an equally important driving factor.

 

But ESO is much more complex than BPO because of the complex nature of engineering design. Engineering services delivery revolves around technical skills, domain expertise and good engineering judgment. Engineering design work centres on product IPs of manufacturing companies. Most of the services outsourced are related to design services around patented products, design specifications or customised interiors of a total engineering solution.

 

 

Can all engineering services be outsourced?

 

In theory, yes. In practice, no.

 

 

What types of engineering services are being outsourced?

 

Well, a rather wide range of engineering support services have been outsourced for many years, but most of these outsourcing assignments have been with onshore or nearshore partners/vendors. Offshore outsourcing of engineering services is a relatively recent phenomenon and only a small subset of services are currently being offshored - examples are CAD outsourcing for a variety of design intensive industries, automobile & other product designing, testing & analysis of products for various parameters and characteristics.

 

Many companies have begun to make a mark, successfully using the skill-sets, tools and experience from IT software and services, to evolve from providing basic data conversion, through 2D and 3D CAD/CAM/CAE, advanced simulation, prototyping, testing, PLM, product design (engineering), process engineering, plant automation and asset management services. Though most of the initial players in the segment have emerged from legacy IT services businesses, today the segment has matured with several of these firms having established an independent engineering services practice:

 

• Engineering Services Outsourcing
• Design, Mechanical & Manufacturing Engineering
• Plant Automation & Enterprise Asset Management
• Electrical & Electronics Engineering
• Advanced Simulations, Prototyping, Styling & Testing
• Embedded Design & Development Engineering
• Product Lifecycle & Data Management

 

Offerings to US clients include concept modeling of products based on customer requirements, as well as the design and manufacture of:

 

• Jigs and fixtures
• Hydraulic systems
• Material handling equipment
• Assembly systems

 

CAD and design services in AutoCAD

 

• SolidWorks, SolidEdge, and Pro/E
• Architectural drawings
• Building and Systems layout (HVAC, piping, systems, etc.)
• Legacy data conversion
• Drafting and detailing
• 3D modeling and assembly
• Preparation of production drawings
• Parts lists and bill of materials
• Handling ECNs (Engineering Change Notices)
• Higher-level CAD tasks
• AutoCAD, SolidWorks, SolidEdge, Pro/E

 

 

Why can't some engineering services be outsourced in practice?

 

For strategic reasons and integration with other processes.

 

• Strategic - for many companies that consider their engineering expertise to be their core strength, outsourcing their engineering services might be akin to giving away their crown jewels. They might wish to keep a select list of engineering services to be done within their company, at any cost.

 

• Integration with other processes - Even in cases where a company might not consider a particular engineering process as its core strength, it might not be able to outsource it because of the close integration this process has with some other core engineering processes / services. For instance, an auto company might not be willing to outsource its mock-up modelling processes to other companies because its main car design architectural team (which the company might consider its core strength) might be working far too closely with the mock-up modeling team and any disruption in this seamless process could be very costly to the company in the long term.

 

• Legal & Policy / Governmental, Trade Restrictions

 

 

What are the engineering services that cannot be outsourced in practice?

 

There are many processes that limit the amount and type of work that can be offshore outsourced: proximity needs, expertise, licensure, and quality of work. Construction or manufacturing engineering requires proximity to where the project is being undertaken. U.S. engineers possess expertise in specific areas, making it undesirable to use foreign engineers. Certain types of engineering work require the signature of a licensed engineer. Thus far, it is difficult for a foreigner to become licensed or for licensed engineers to sign off on work that is not done under their direct supervision. Finally, if offshore outsourcing results in diminished quality, insurance companies may take notice and charge higher premiums. This added expense would make offshore outsourcing less appealing.

 

How is it possible to offshore engineering services? Aren't there physical constraints to outsourcing engineering services, as against outsourcing IT or business processes?

 

Engineering services, especially in design, can easily be exchanged offshore

 

Engineering work is generally not seen as a commodity. It is seen as an iterative process of design and reevaluation. There are many stages—planning, design, manufacturing or construction, and then finalization. Each step requires the skills and expertise of an engineer in different ways. The final step may require an engineer to actually operate, teach the operation, or sell the product. While the entire engineering process does not seem conducive to offshore outsourcing, there are pieces that can be outsourced. Typically, a company outsources projects or engineering tasks to another company within the United States. However, some of this work is starting to go offshore. Larger engineering companies would actually set up divisions abroad where they would hire foreign engineers to work for their company. For example, Boeing has a Russian division designing airplane components. General Electric employs over 6000 engineers and scientists in Israel, Hungary, India and China to research and develop

To outsource your Design Engineering Services go to: www.segula.ro
Source: http://www.wise-intern.org