Friday, September 08, 2006

Tapan Mukerji's World

Engineering Outsourcing

Generally, outsourcing most of the times tends to be related to cost saving. Well, this may be one part of the story but not the single driver. Basically, one goes to outsource when it is not possible to accomplish the same way in-house. So this may be cost, technology, time lines or whatever.

With our experience of handling various projects from offshore, we have seen engineering outsourcing is also interpreted most of the times as drafting assignments. Equally untrue is this interpretation!

There are many areas like design, analysis, project management where the customer simply may not have the expertise. Recently, we did a finite element analysis of a complicated configuration for a large manufacturing US organization. It is interesting to note that the organization had been manufacturing the same product for 20 years but when it came to performing a finite element analysis, they had to outsource offshore.

In this case demand for technology prevailed over everything else. So offshore companies are not solely meant for labor intensive functions - many of them have highly specialized technology skill to offer.

3 Comments:

Anonymous eTechSupport said...

Its all about saving cost, if work is done outside better than in-house we should do it, by saving cost you can also serve better to your end users.

10:59 AM  
Anonymous China Consulting said...

I affirm what etechsupport said. Beyond that,

there is another element which is even better than cost expressed in dollars, and that is time.

Small business owners may be able to outsource work at a greater cost than if they did it themselves and still come out ahead if they devote that time saved to strategic planning and developing initiatives that will pay off greater returns over the long-haul.

3:22 PM  
Anonymous DanAsian CTO said...

It is not all about cost!

Many customers seek the cost benefit, but most of our customers choose outsourcing due to the fact that they do not have all the competances within their organisation to solve every problem.

Finally a lot of our customers, come to us when they do not have the man power to deliver in time. Most customers are able to reduce time to market with several months by outsourcing.

Jimmy Borch
DanAsian CTO
www.danasian.dk

3:47 PM  

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