Pros and Cons of Engineering Services Outsourcing

In order to keep pace with growing consumer demands for new products ranging from computers and Smartphone’s to hybrid cars, a major chunk of the companies around the world are feeling the heat of increasing their engineering capability. The fallout of this scenario is the emergence of a fast growing outsources engineering market. While taking a look at the brighter side of the story, it surely means some good news from the clients end but there are also many greater challenges that are unfurling as time passes by.

The Pros of Outsource Engineering

An external outsource engineering firm can not only aid the company in the development of products but also in executing conversion processes too. The advantages of outsourcing your engineering work are as under:

• Development cycle is Compressed: The companies that provide outsource engineering services have an expert and dedicated staff at their disposal. This helps in shortening the time duration of the development cycle of the product by taking advantage of the new technologies that these outsourcing companies have developed over time resulting in cost effective and efficient results.
• Operational Efficiency: There are three factors that are involved in sending the core product to the market when it comes to engineering services, which include fixed asset investing, engineering resources and added labor. Alternatively it means that the company is left with enough finance to invest in other resources to extend their center competencies.
• External Engineering Resource Utilization: Many a times it so happens that the development of a product would require specific engineering services that are not covered under the ambit of the company, for instance, software required to finish a project or a firmware for the development of a specific hardware. In spite of taking the complicated road of investing in additional resources so as to induct new engineering staff into the already existing team, it is an added advantage to prefer to outsource engineering projects.
• Flexibility: Outsourcing engineering service helps with the engineering and design part of the finished product while the company can utilize this time on improving and developing its core competency product. Moreover, if any iteration on the original product is required by the company in accordance with the demands of the emerging trends in the market, they can be carried out with the outsourcing panel ready to respond to these changes as well.

The Cons of Outsourcing Engineering Services

The engineering departments in companies like automotive mobile communications, industrial equipment and aerospace are in constant pressure of innovation and quick designs so as to launch new products because of the shorter product lifecycle and ever increasing demand. This brings to fore the disadvantages associated with outsource engineering:

• Because organizations rely on these external outsourcing companies to carry out their work in the form of supply of certain specified engineering services, non compliance becomes a major issue in the dealings between the two. This can result in earning a bad name and reputation from the clients as well.
• There is a possible loss of control that a company can encounter over its business processes especially if the company follows a set standard procedure of business.
• There are some issues related to the turnaround time and quality of the finished product from the engineering company.
• Many a times it so happens that the issues that have to be resolved are done at a very slow pace coupled with even lethargic response time that hampers the net productivity of the organization as such.
• The performance level might not come up to the required expectations. There is a tug that is usually witnessed between expectations and performance.
• An incensed customer base in combination with infuriated employee unions.

Often the pros associated with engineering services outweigh the cons and hence all the factors need to be well weighed out in advance before taking a decision on which outsourcing company has to be chosen. However it is worth mentioning that the requirements of the market with the ever increasing demands for new products in a small time frame makes the engineering division a good option for outsourcing.
– BackOffice Pro